Elite Engineering And Construction ... vs Techtrans Construction India Pvt. Ltd. ...

2) National Highway Authority of India (NHAI) had entered into agreement dated July 19, 2007 (hereinafter referred to as the ‘Concession Agreement’) whereby it had awarded a contract to M/s. T.K. Toll Road Pvt. Ltd. (hereinafter referred to as the Digitally signed by ‘Concessionaire’) for undertaking, inter alia, the design, NIDHI AHUJA Date: 2018.02.23 16:55:04 IST Reason: engineering, financing, procurement, construction, operation and Civil Appeal No. 2439 of 2018 Page 1 of 18 (arising out of SLP(C) No. 29519 of 2015) maintenance of the Project Highway on Build Operate and Transfer (BOT) basis on the National Highway 67 connecting Coimbatore and Nagapattinam. The Concessionaire vide EPC agreement (Engineering, Procurement and Construction Agreement) dated January 31, 2008 awarded the said work on a fixed lump sum turnkey basis to M/s. Utility Energytech and Engineers Private Limited (hereinafter referred to as the ‘EPC Contractor’). EPC Contractor, in turn, executed a Construction Agreement dated March 14, 2008 with the respondent herein (M/s. Techtrans Construction India Pvt. Ltd.) to execute the works as per terms and conditions entailed in that agreement. Clause 8 of that agreement permitted the respondent to sub-contract the structural work. Pursuant thereto, the respondent floated a tender for sub-contracting their work in which the appellant also submitted its bid and was ultimately awarded the said work by the respondent vide agreement dated July 29, 2009.

3) Some disputes arose between the appellant and the respondent in connection with the execution of the said work and the appellant vide its letter dated March 25, 2013 raised certain claims against the respondent. The appellant also filed Original Petition under Section 9 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the ‘Act’) on the file of Principal Civil Appeal No. 2439 of 2018 Page 2 of 18 (arising out of SLP(C) No. 29519 of 2015) Judge, Karur. This petition was contested by the respondent who in its reply denied all the allegations raised by the appellant and also submitted that since there was no arbitration agreement between the parties, the petition under Section 9 of the Act was not maintainable. While this was pending, the appellant moved application under Section 11(3) and (5) of the Act for appointment of an arbitrator in the High Court of Judicature at Madras on January 28, 2014. Notice in this petition was issued by the High Court. In the meantime, on June 30, 2014, the Principal Judge, Karur allowed the petition of the appellant under Section 9 of the Act, but left open the issue of existence of arbitration agreement.

5) It may be clarified at this juncture that Agreement dated July 29, Civil Appeal No. 2439 of 2018 Page 3 of 18 (arising out of SLP(C) No. 29519 of 2015) 2009 entered into between the appellant and the respondent does not contain any arbitration clause. There is no independent arbitration agreement between the parties either. However, case set up by the appellant was that this Agreement dated July 29, 2009 entered into between the parties, by implication, incorporates the arbitration agreement that is contained in the Agreement dated March 14, 2008 that was entered into between the EPC Contractor and the respondent.

The High Court, thus, opined that from the communications only, it could not be said that parties had agreed for arbitration and, in fact, the appellant in his petition filed under Section 9 of the Act had professed ignorance of the agreement between the respondent and the employer. As it had gone to the extent of making an averment to the effect that ‘the petitioner is totally kept in dark about the terms and conditions of the agreement till now’. The High Court thereafter construed clauses 2 and 9.10 of the Agreement that was entered into between the appellant and the respondent and came to the conclusion that those clauses never meant to incorporate arbitration agreement into the Agreement dated July 29, 2009 executed between the parties. On this aspect, discussion goes as follows:

14) After considering the respective submissions, we are inclined to agree with the respondent and, therefore, do not find any fault with the impugned judgment of the High Court.

FEBRUARY 23, 2018.

Civil Appeal No. 2439 of 2018 Page 18 of 18 (arising out of SLP(C) No. 29519 of 2015)