Karnataka High Court
M/S Gvr Infra Projects Private Limited vs The Executive Engineer on 12 January, 2024
Author: S.R.Krishna Kumar
Bench: S.R.Krishna Kumar
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NC: 2024:KHC:1839
CMP No. 807 of 2022
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 12TH DAY OF JANUARY, 2024
BEFORE
THE HON'BLE MR JUSTICE S.R.KRISHNA KUMAR
CIVIL MISC. PETITION NO.807 OF 2022
BETWEEN:
M/S GVR INFRA PROJECTS PRIVATE LIMITED
#476, TALA CAUVERY LAYOUT,
AMRUTHA HALLI
BYATARAYANAPURA
NEW BENGALURU INTL. AIRPORT ROAD,
REPRESENTED BY
GALI CHALAPATHI.
BENGALURU - 560 092.
...PETITIONER
(BY SRI. AJAY J. NANDALIKE., ADVOCATE)
AND:
THE EXECUTIVE ENGINEER
NATIONAL HIGHWAYS DIVISION
ASHOK NAGAR, URWA STORE
MANGALURU - 575 006.
Digitally ...RESPONDENT
signed by (BY SMT. SAVITHRAMMA, AGA)
VANDANA S
THIS CIVIL MISC. PETITION UNDER SEC.11(5) AND (6) OF
Location: THE ARBITRATION AND CONCILIATION ACT 1996, PRAYING TO
HIGH APPOINT MR. GANESH CHANDRA KABI, ARBITRATOR AND
COURT OF
KARNATAKA FORMER ENGINEER, CPWD, GOVERNMENT OF INDIA AS SOLE
ARBITRATOR PURSUANT TO CLAUSE 25.3 OF THE GENERAL
CONDITIONS OF CONTRACT R/W CLAUSE 3 OF THE SPECIAL
CONDITIONS OF CONTRACT, WITH A DIRECTION TO THE
ARBITRATOR TO ADJUDICATE THE DISPUTES BETWEEN THE
PETITIONER AND RESPONDENTS ARISING OUT OF THE
AGREEMENT BETWEEN THE PARTIES DATED 02/09/2011 AND ETC.
THIS PETITION, COMING ON FOR ADMISSION, THIS DAY,
THE COURT MADE THE FOLLOWING:
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NC: 2024:KHC:1839
CMP No. 807 of 2022
ORDER
The present petition under Section 11 of the Arbitration and Conciliation Act, 1996, has been filed by the petitioner against the respondent seeking appointment of an Arbitrator in terms of the Arbitration Agreement contained at Clause No.25.3(a) in the Agreement dated 02.09.2011 entered into between the parties.
2. Clause-25.3(a) of the said Agreement, which contains an Arbitration clause, reads as under:-
"ARBITRATION (GCC Clause 25.3) The procedure for arbitration will be as follows:
25.3(a) In case of Dispute or difference arising between the Employer and a domestic contractor relating to any matter arising out of or connected with this agreement, such disputes or difference shall be settled in accordance with the Arbitration and Conciliation Act, 1996. The parties shall make efforts to agree on a sole arbitrator and only if such an attempt does not succeed and the Arbitral Tribunal consisting of
3 arbitrators one each to be appointed by the Employer and Contractor and the third Arbitrator to be chosen by the two Arbitrators so appointed by the Parties to act as Presiding Arbitrator shall be considered. In case of -3- NC: 2024:KHC:1839 CMP No. 807 of 2022 failure of the two arbitrators appointed by the parties to reach upon a consensus within a period of 30 days from the appointment of the arbitrator appointed subsequently, the Presiding Arbitrator shall be appointed by the *Council, Indian Roads Congress.
(b). The Arbitral Tribunal shall consist of three Arbitrators one each to be appointed by the Employer and the Contractor. The third Arbitrator shall be chosen by the two Arbitrators so appointed by the Parties, and shall act a presiding arbitrator. In case of failure of the two arbitrators appointed by the parties to reach upon a consensus within a period of 30 days from the appointment of the arbitrator appointed subsequently, the Presiding arbitrator shall be appointed by the *Council, Indian Roads Congress.
(c). If one of the parties fails to appoint its arbitrator in pursuance of sub-clause (a) and (b) above within 30 days after receipt of the notice of the appointment of its arbitrator by the other party, then the *Council, Indian Roads Congress shall appoint the arbitrator. A certified copy of the order of the Council, Indian Roads Congress making such an appointment shall be furnished to each of the parties. -4-
NC: 2024:KHC:1839 CMP No. 807 of 2022
(d). Arbitration proceedings shall be held in India, and the language of the arbitration proceedings and that of all documents and communications between the parties shall be English.
(e). The decision of the majority of arbitrators shall be final and binding upon both parties. The cost and expenses of Arbitration proceedings will be paid as determined by the arbitral tribunal. However, the expenses incurred by each party in connection with the preparation, presentation, etc., of its proceedings as also the fees and expenses paid to the arbitrator appointed by such party or on its behalf shall be borne by each party itself.
(f). Performance under the contract shall continue during the arbitration proceedings and payments due to the contractor by the owners shall not be withheld unless they are the subject matter of the arbitration proceedings."
3. The material on record discloses that since disputes arose between the parties in relation to the aforesaid Agreement containing the aforesaid arbitration agreement / clause, the petitioner invoked the aforesaid arbitration clause and issued a notice dated 04.01.2021 to the respondent putting forth various -5- NC: 2024:KHC:1839 CMP No. 807 of 2022 claims and contentions and nominating and appointing a sole arbitrator and calling upon the respondent to give its concurrence / consent to refer the dispute to arbitration.
4. The respondent did not send any reply and did not dispute or deny the existence of arbitration agreement / clause in the contracts entered into between the parties. Subsequently, the parties have not only failed to resolve their disputes but they have also not reached any consensus / agreement for appointment of an arbitrator and as such, petitioner is before this Court by way of the present petition. Even in the present petition, while the respondent has not filed their statement of objections, it has denied and disputed the various claims of the petitioner. However, the respondent do not dispute or deny the existence of arbitration agreement / clause in the contracts entered into between the parties.
5. In view of the aforesaid facts and circumstances, though several contentions have been urged by both sides in support of their respective claims, having regard to the undisputed fact that there exists an arbitration agreement / clause in the contracts entered into between the parties, without expressing any -6- NC: 2024:KHC:1839 CMP No. 807 of 2022 opinion on the merits / demerits of the rival contentions, I deem it just and appropriate to allow this petition by referring the dispute between the parties to arbitration with the consent of both sides by appointing Dr. Justice N. Kumar, former Judge, High Court of Karnataka, to act as the sole Arbitrator to resolve the dispute between the parties under the provisions of the Arbitration and Conciliation Act, 1996.
6. In the result, I pass the following ORDER
(i) Petition is hereby allowed.
(ii) Dr. Justice N. Kumar, former Judge, High Court of Karnataka, is hereby appointed as the sole Arbitrator to resolve the dispute between the parties.
(iii) All rival claims, contentions, etc., of both parties including contentions relating to maintainability, arbitrability, jurisdiction, limitation, stamp duty, etc., are left / kept open to be decided by the Arbitral Tribunal and no opinion is expressed on the same.
-7- NC: 2024:KHC:1839 CMP No. 807 of 2022 (iv) A copy of this order be sent forthwith to Dr. Justice N. Kumar, former Judge, High Court of Karnataka, to the following address: "Gruha", No.101, Skyline Golden Ray Apartment, K.P. Poornachandra Thejaswi Road, Kempegowda Nagar, Gavipuram, Bengaluru - 560 019. (v) Registry is directed to return all original documents
produced by any of the parties after obtaining Photostat copies of the same.
Sd/-
JUDGE SV List No.: 1 Sl No.: 80