Delhi District Court M/S J.K. Enterprises vs Union Of India on 30 September, 2022 IN THE COURT OF SH GURVINDER PAL SINGH, DISTRICT JUDGE (COMMERCIAL COURT)02, PATIALA HOUSE COURT, NEW DELHI OMP (Comm.) No. 75/2022 M/S J.K. Enterprises Through Jitendra Sharma (Partner) 403, Antrix Green, Kaushambi, Ghaziabad, Uttar Pradesh201012 ...Petitioner versus Union of India Through Executive Engineer (E), BFLD, CPWD, 79th BN, BSF Campus, Mundra Road, BHUJ, GUJARAT370001 ...Respondent Date of Institution : 13/05/2022 Arguments concluded on : 09/09/2022 Decided on : 30/09/2022 Appearances : Sh. Arvind Kumar Nagpal and Ms. Neeru Nagpal, Ld.Counsel for petitioner. Sh . Harinder Krishan Talwar, Ld. Counsel for respondent with Sh. Sandeep Chandna, Advocate. JUDGMENT 1. Petitioner had filed the present petition under Section 34 of The Arbitration and Conciliation Act, 1996 (herein after referred as The Act), seeking setting aside of the impugned arbitral award dated 17/01/2022 of Ld. Sole Arbitrator Sh. Vasdev Nainani in case no. ARB/VN/1/21 titled "M/s J.K. Enterprises vs Union of India". Ld. Sole Arbitrator awarded (1) release of the Performance Guarantee of Rs. 3,90,603/; (2) release of Security Deposit of Rs. 1,30,041/; (3) cost of arbitration Rs 2,00,000/; subject to claimant submitting proof of payment of wages of OMP (Comm.) No. 75/2022 M/S J.K. Enterprises vs Union of India Page 1 of 36 staff, EPF contributions within two months and thereafter in 45 days respondent is to make payment of award sum; else the post award interest @ 10% per annum was payable by respondent to claimant/petitioner. 2. I have heard Sh. Arvind Kumar Nagpal and Ms. Neeru Nagpal, Ld. Counsel for petitioner; Sh. Harinder Krishan Talwar, Ld. Counsel for respondent with Sh. Sandeep Chandna, Advocate and perused the record of the case, reply of respondent, the arbitral proceedings record, filed brief written arguments, relied upon precedents on behalf of parties and given my thoughtful consideration to the rival contentions put forth. 3. Following is the brief factual matrix of case of parties. Petitioner entered into Agreement No. 08/EE(E)/BFLD/Bhuj/ 201819 with the respondent for the work namely 'Maintenance of Border Flood Lighting works for BOP No. 1061 to 1097 along IndoPak Border at Bhuj in Gujarat Sector (SH: Maintenance of BFL and RMO DG sets)'; consequent to acceptance of the lowest bid of the petitioner by respondent vide letter dated 16/03/2019 and issuance of the letter of commencement (Award letter) on 01/04/2019, upon deposit of the Performance Guarantee by the petitioner on 20/03/2019. The stipulated date of start of the work was 31/03/2019. The work was predominantly of Operation and Maintenance nature and was to be carried out for a period of 12 months. 4. Following are the relevant material facts of the case of petitioner. The site being secure and sensitive area, under the OMP (Comm.) No. 75/2022 M/S J.K. Enterprises vs Union of India Page 2 of 36 control of the BSF; after issuance of the entry/gate passes to the workers of the petitioner and the handing over of the site by respondent, the work actually commenced on 10/04/2019 and was to be carried out up to 09/04/2020. Petitioner successfully carried out the work for about nine months despite non releasing of the timely payments/arbitrarily and unjustifiably withholding and/or recovering considerable amount from the bills of the petitioner by the respondent. Respondent issued show cause notice no. 54(43)/BFLD/Bhuj/2020/32 dated 21/01/2020 by invoking Clause 3 of the agreement. Respondent, abruptly determined the Agreement vide letter no. 54(43)/BFLD/Bhuj/2020/55 dated 31/01/2020, on the very last working day of the then EngineerinCharge i.e., the then Executive Engineer, before his superannuation and this happened despite of the petitioner's telephonically talking to the respondent and sending emails on 23/01/2020 and 30/01/2020 and getting positive response on phone. Petitioner vide letter dated 12/02/2020 addressed to the Additional DG (B), CPWD, requested for referring the disputes enumerated by the petitioner to the Dispute Redressal Committee (DRC) in terms of Clause 25 of the agreement. Vide letters dated 19/08/2020 and 02/09/2020 petitioner requested Chief Engineer, BFLZ, CPWD for appointment of an Arbitrator. The Chief Engineer, BFLZ, CPWD vide letter dated 01/10/2020 appointed Ld. Sole Arbitrator, in terms of the powers conferred on him under Clause 25 of the agreement. Arbitral proceedings culminated into