Gujarat High Court
Ranjit Buildcon Limited vs State Of Gujarat on 9 September, 2022
Author: Aravind Kumar
Bench: Aravind Kumar
C/IAAP/15/2020 ORDER DATED: 09/09/2022
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/PETN. UNDER ARBITRATION ACT NO. 15 of 2020
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RANJIT BUILDCON LIMITED
Versus
STATE OF GUJARAT
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Appearance:
MR CHIRAG B PATEL(3679) for the Petitioner(s) No. 1
MR. K.M. ANTANI, LD. ASST. GOVERNMENT PLEADER for the
Respondent(s) No. 1,2
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CORAM:HONOURABLE THE CHIEF JUSTICE MR. JUSTICE
ARAVIND KUMAR
Date : 09/09/2022
ORAL ORDER
1. Petitioner is seeking for appointment of an Arbitrator through this petition filed under Section 11(6) of the Arbitration & Conciliation Act, 1996 (for short "the Act, 1996"), contending, inter alia, that Superintending Engineer, Ahmedabad Irrigation Project Circle, Ahmedabad had invited tenders for construction work of barrage, protection work etc. for Sant Sarovar (Indroda) recharge scheme across the river Sabarmati, and after having completed the work entrusted under the contract, entire amount due to the petitioner was not paid, and as such, petitioner was constrained to submit a claim and the tender which itself formed part and parcel of the contract enables the petitioner to seek for appointment of Page 1 of 11 Downloaded on : Sun Dec 25 01:29:49 IST 2022 C/IAAP/15/2020 ORDER DATED: 09/09/2022 an arbitrator under Clause (30) and though said clause indicate that arbitration has to be before the Arbitration Tribunal, Gujarat State, the scope of work entrusted to the petitioner would not fall under the works contract, and as such, the petitioner has prayed for appointment of an independent sole arbitrator.
2. On respondents being notified, they have appeared and addressed oral arguments. However, no reply has been filed.
3. We have heard the arguments of Mr. B.S. Patel, learned senior counsel appearing for the petitioner and Mr. K.M. Antani, learned AGP appearing for the State- respondents.
4. It is the contention of Mr. Patel, learned senior counsel appearing for the petitioner that work which has been entrusted to the petitioner was relating to construction of a barrage with use of weir and said work entrusted to the petitioner would not fall within the definition of Clause (2)(1)(k) of the Gujarat Public Works Contracts Disputes Arbitration Tribunal Act, 1992, and as such, respondents are not justified in denying the demand of the petitioner for referring the matter to the Arbitration Tribunal, and on account of their refusal to refer the matter, petitioner had got issued legal notice, which has not been responded to positively by Page 2 of 11 Downloaded on : Sun Dec 25 01:29:49 IST 2022 C/IAAP/15/2020 ORDER DATED: 09/09/2022 respondents, and as such, he has prayed for appointment of a sole arbitrator by this Court. In support of his submissions, he has relied upon the following judgments;
(I) In the case of Om Construction
Company vs. Ahmedabad Municipal
Corporation, reported in (2009) 2 SCC 486;
and
(ii) Unreported judgment in the case of
Ocean Diving Centre Pvt. Ltd. vs.
Gujarat Electricity Board, Arbitration Case No.53 of 1999.
5. Per contra, Mr. K. M. Antani, learned AGP appearing for the respondents would reiterate the stand taken by the respondents in not referring the dispute to the Arbitration Tribunal inasmuch as the scope of work, which is entrusted to the petitioner would definitely fall within the definition of Section 2(1)(k) of the Arbitration Tribunal Act, and as such, he prays for rejection of the petition.
6. Having heard the learned advocates appearing for the parties and on perusal of records, this Court is of the considered view that following point would arise for consideration;
Whether the scope of work as entrusted to the Page 3 of 11 Downloaded on : Sun Dec 25 01:29:49 IST 2022 C/IAAP/15/2020 ORDER DATED: 09/09/2022 petitioner under the subject contract would fall within the definition of Section 2(1)(k) of the Arbitration Tribunal Act, 1992 or not? Discussion and Findings
7. In order to examine the contention raised by the learned senior counsel appearing for the petitioner, it would be necessary to take note of the scope of work which was entrusted to the petitioner under the subject contract. It reads thus;
"The scope of work under this tender is includes Civil Works for Construction of Barrage Structure on River Sabarmati at Gandhinagar. The major activities includes under the scope of work of this tender are mentioned as under:
Dismantling various components of earlier constructed weir- which is located in the vicinity of proposed Barrage.
Excavation for foundation of Structure, Retaining Walls, Training Walls, Key, Raft, Pier, Upstream/Downstream Blocks, Upstream/Downstream Loose Apron, Toe Wall, Apron, Cut-off wall etc. Cement Concrete/Reinforced Cement Concrete of Grade M-10, M-15, M-20 and M-25 for various structural components like Raft, Retaining Wall, Page 4 of 11 Downloaded on : Sun Dec 25 01:29:49 IST 2022 C/IAAP/15/2020 ORDER DATED: 09/09/2022 Training Wall, Pier, Upstream/Downstream Apron, Cement/Concrete Blocks, Diaphragm Wall etc. Providing and Laying TMT-Fe 415 grade reinforcement for Reinforced Cement Concrete work of Barrage Structure.
Construction of RCC Diaphragm Wall of 60 and 75 cm thickness.
Providing and Laying Loose Rubble Stone (Black Trap), Apron.
Providing and Laying Graded Filter of Sand, Gravel and Quarry Spouls.
Providing and Constructing Weep Holes. Providing and Fixing PVC Heavy Duty Water Stops of various size.
Providing and Laying Sand Layer in different position.
Providing and Placing double twisted Hexagonal Zn+PVC coated box wire mesh Gabions of size 1m x 1m x 0.60 mt for protection works.
Providing and laying inverted graded filter of Sand and Gravel below protection wall.
Providing and Laying Stone Spouls layer for protection work.
Backfilling with selected earth."
8. In the teeth of the defense set up by the State to stave off the plea of appointment of Arbitrator by relying Page 5 of 11 Downloaded on : Sun Dec 25 01:29:49 IST 2022 C/IAAP/15/2020 ORDER DATED: 09/09/2022 upon Section 2(1)(k), which defines the expression 'Works Contract', it would be necessary to extract the said definition. It reads thus;
"2(1)(k) "Works contract" means a contract made by the State Government or the public undertaking with any other person for the execution of any of its works relating to construction, repairs or maintenance of any building or superstructure, dam, weir, canal, reservoir, tank, lake, road, well, bridge, culvert, factory or work shop or of such other work of the State Government or, as the case may be, of the public undertaking, as the State Government may, by notification in the Official Gazette specify, and includes-
(i) a contract made for the supply of goods relating to the execution of any of such works,
(ii) a contract made by the Central Stores Purchase Organization of the State Government for purchase or sale of goods."
9. A plain reading of the above definition would clearly indicate where contract is entered into by the State Government or a public undertaking with any other person for the execution of any of its works, relating to construction, repairs or maintenance of any building or superstructure, dam, weir, canal, reservoir, tank, lake, road, well, bridge, culvert etc. as more fully described in the expression thereunder, would fall within the definition of the 'Works Contract'. Thus, it would depend upon the scope of work entrusted to the contracting party by the State or the public undertaking, as the case may be. In Page 6 of 11 Downloaded on : Sun Dec 25 01:29:49 IST 2022 C/IAAP/15/2020 ORDER DATED: 09/09/2022 the instant case, petitioner has been entrusted with certain works and the scope of work, with which, the petitioner has to work, has been defined in Section 1 of the tender document which is treated as part and parcel of the contract which is also not disputed by the petitioner. In fact, petitioner has also heavily relied upon the scope of work. A perusal of the same would indicate under the contract in question several works have been included. The major activities included under the scope of work which was entrusted to the petitioner as indicated in Section-1 of the Scope of Work amongst others would include cement concrete/reinforced cement concrete of Grade M-10, M-15, M-20 and M-25 for various structural components like Raft, Retaining Wall, Training Wall, Pier, Upstream/ Downstream Apron, Cement Concrete Blocks, Diaphragm Wall etc. Contract also mandates that tenderer has to carry out the work of providing and laying TMT-Fe 415 grade reinforcement for reinforced cement concrete work of barrage structure as also the construction of RCC Diaphragm Wall of 60 X 75 cm thickness. This scope of work to be executed by the petitioner would leave no manner of doubt in this Court that it would not only include the barrage work but also major works as noted herein above. The expression "Barrage" found in the contract, cannot be read disjunctively but on the other hand the words used in the Scope of Work has to be read conjunctively. Even Page 7 of 11 Downloaded on : Sun Dec 25 01:29:49 IST 2022 C/IAAP/15/2020 ORDER DATED: 09/09/2022 otherwise, the word "Barrage" accompanying the word "Construction" has to be read together by applying the principle of Doctrine of noscitur a sociis. In other words, the words, with which, it keeps company would dignify the meaning. In this background, when the words used in the scope of work entrusted to the petitioner in fact it would disclose the scope of work includes construction of retaining wall, training wall and providing and laying of TMT-Fe 415 grade reinforcement including construction of RCC Diaphragm wall, the thickness of which also has been specified in the scope of work as 60 to 75 cm thickness. Hence, petitioner cannot be heard to contend the scope of work does not include construction. The expression "Construction" having been used in Section 2(1)(k) can also be referred to dam construction, canal construction, reservoir construction, tank construction, road construction, lake construction and said word would partake within its sweep all such constructions. In that view of the matter, the contention raised by the learned senior counsel appearing for the petitioner would not hold water and is liable to be rejected and, accordingly, it stands rejected.
10. Insofar as the judgment of the Coordinate Bench of this Court in the matter of Ocean Diving Centre Pvt. Ltd. (supra) relied upon when perused, it will not detain this Court for too long to brush aside the contention raised by Page 8 of 11 Downloaded on : Sun Dec 25 01:29:49 IST 2022 C/IAAP/15/2020 ORDER DATED: 09/09/2022 Mr. Patel, learned senior counsel, inasmuch as Coordinate Bench itself has noticed in the case of Arun Construction Company vs. GSCC Ltd., the issue involved therein was relating to the work of "providing gates for the channel from the dam for controlling water to the power plant of the Corporation", and plea put forward by the respondent therein, namely, Gujarat Electricity Board to raise a similar plea as is now raised by Mr. Patel was negatived on the ground that the said principles enunciated in Arun Construction Company would not be applicable inasmuch as in the matter of Ocean Diving Centre, the work entrusted was only "desilting and cleaning of the channel" and it did not include or take within its sweep either construction or any part of construction within the activity of silting and desilting or cleaning of the channel. In that view of the matter, I am of the considered view that judgment relied upon by the learned senior counsel appearing for the petitioner would be inapplicable to the facts of the present case.
11. Insofar as the judgment of the Hon'ble Apex Court in the matter of Om Construction Company (supra), relied upon by the petitioner, would not come to the rescue of the petitioner inasmuch as in the said case, the larger issue which came to be considered was relating to the Ahmedabad Municipal Corporation not being a public undertaking though being a local authority and in the Page 9 of 11 Downloaded on : Sun Dec 25 01:29:49 IST 2022 C/IAAP/15/2020 ORDER DATED: 09/09/2022 absence of the notification, the plea regarding the matter being referred to the Gujarat Arbitration Tribunal was negatived, whereas in the instant case, the scope of contract being clear, express and leaving no matter of doubt to arrive at an irresistible conclusion that the subject contract not only include construction of barrage for the said purpose, there is the construction of the retaining walls, training walls and providing reinforcement work including construction of RCC Diaphragm wall of 60 and 75 cm thickness which cannot be held that it would not fall within the four corners of the definition of 'Construction'. As such the second judgment relied upon by the learned counsel appearing for the petitioner would not be applicable to the facts on hand.
12. Hence, I proceed to pass the following order;
ORDER
(i) Petition is dismissed with costs.
(ii) Petitioner would be at liberty to seek for
appointment of Arbitrator by filing a
reference before the Tribunal under Section 8 of the Gujarat Public Works Contracts Disputes Arbitration Tribunal Act, 1992.
(iii) Petitioner is directed to pay the Page 10 of 11 Downloaded on : Sun Dec 25 01:29:49 IST 2022 C/IAAP/15/2020 ORDER DATED: 09/09/2022 respondent-State a sum of Rs.10,000/-
towards the costs of this proceedings.
(ARAVIND KUMAR,CJ) Vahid Page 11 of 11 Downloaded on : Sun Dec 25 01:29:49 IST 2022