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17. Response to the petition is filed by THDC, strongly opposing the relief prayed for. KCT filed its rejoinder, reiterating the contents of the petition and denying the averments made in the Opposition filed on behalf of the Respondent.

18. This Court has heard the submissions advanced by Mr.A.K. Ganguly, the learned senior counsel for KCT and Mr. Gourab Banerjee, the learned Additional Solicitor General on behalf of THDC.

CONTENTIONS OF KCT

19. At the outset, Mr. A.K. Ganguly, the learned senior counsel for KCT submitted that the work pertaining to Package-III was completed on 30.04.2007 and a completion certificate was issued by THDC on 08.06.2007. Thereafter, the DRB has ceased both by operation of contract as also by conscious decision/election by one party, namely, THDC, and also by virtue of the fact that the quorum had not been established owing to the resignation of member(s). He contended that the purpose of the DRB was to expeditiously resolve the disputes during the progress of work. However, despite a lapse of more than three years after completion of work on 30th April, 2007, the DRB had failed to decide the disputes pending before it. Hence, the very purpose of existence of DRB stood defeated. He submitted that despite execution of the contract(s) in the year 1996 and the appointment by KCT of its DRB member on 12.09.1996, THDC nominated its member in 2001 and constituted DRB on 10.05.2002. Even after its constitution, DRB decided only 4 out of the 20 disputes referred to it till 2010. Mr.V.V. Badareenarayana, THDC‟s nominee member of DRB resigned on 15.01.2005, and the new DRB member (THDC nominee) was appointed only in March, 2008, i.e., after a lapse of three years. This newly constituted DRB also rendered itself unfit to act as an adjudicator as was apparent from the fact that the members of the DRB had only been harping on the fixation of higher fee structure, rather than taking steps to decide the dispute between the parties. The DRB thus explicitly rendered itself nothing more than a party with vested interest.

20. Reference in the aforesaid context was made by Mr. Ganguly to letter dated 30th May, 2008 from KCT to THDC complaining about non-functioning of DRB despite KCT‟s consent to the nomination of Mr. N.K. Choudhari as DRB member; letter dated 31.05.2008 whereunder Mr. N.K. Choudhari (the THDC nominee) consented to be nominated as member of DRB after a lapse of five months subject to modified payment terms pertaining to retainer fee per calendar month, besides payment of actual sitting days; letter dated 07.06.2008 from THDC to DRB members requesting for initiation of DRB proceedings; letter dated 26.06.2008 from Chairman, DRB to all concerned informing about the meeting to be held on 31st July, 2008 to discuss fee structure of DRB members; Minutes of the first meeting of the newly formed DRB dated 31.07.2008 giving details of fee structure as discussed and suggested in the meeting; letter dated 19 th September, 2008 from KCT to DRB Members agreeing to the enhancement of fee from ` 3,000/- to ` 5,000/- per hearing without retention fee; Minutes of the meeting of the DRB dated 05.05.2009 pertaining to enhancement of the fee structure; letter dated 23.06.2009 from Mr. N.N. Singhal (KCT‟s nominee on DRB), the relevant portion whereof is reproduced hereunder:-

35. Mr.Banerjee urged that KCT‟s submission that DRB can simply be bypassed, cannot and should not be countenanced by this Court. The DRB is functional and operative and KCT cannot be allowed to take advantage of its own wrong conduct to sabotage the functioning of DRB, whose one member and Chairman are continuing and KCT is required to nominate its member as per the procedure, which THDC requested KCT to follow on 26.6.2010.

36. Rebutting KCT‟s submission that DRB was only relevant till 08.06.2007 or a maximum of one year thereafter, Mr. Banerjee contended that this was contrary to the conduct of KCT itself and also contrary to Clause (IX) pertaining to termination of the Agreement. He submitted that two aspects were not in dispute, viz., that the DRB was reconstituted in 2008 and held its first meeting on 31st July, 2008 and the second that KCT made various claims before the DRB on 20th July, 2009, 8th August, 2009, 19th August, 2009, 4th October, 2009 and 9th October, 2009. A further claim was submitted to the DRB on 24 th May, 2010, i.e., after issuance of notice by KCT dated 24.04.2010 invoking arbitration. Thus, it is now not open to KCT to urge that DRB had ceased to function upon the completion of contract. He also submitted that Clause (IX) titled "Termination of Agreement" is crystal clear. The Agreement will only terminate upon issuance of a Maintenance Certificate as provided under the contract between the parties and on settlement of all outstanding disputes involving financial claims. Disputes have not been settled and, therefore, the DRB continues to be effective. In any event, the dispute resolution clause is not tied to the contract.

Though Mr. Banerjee is correct in his submission that ordinarily Clause 60.0 of GCC, which envisages a four-tier dispute resolution mechanism, ought not to be given a go-bye, I have serious reservations in accepting his submission that the DRB has not been rendered redundant with the passage of fourteen years which have elapsed from the time when the parties penned the contract(s). It is also noteworthy that KCT had followed the procedure prescribed in the contract from the inception of the contract by appointing its nominee DRB member in the year 1996 itself, but due to delay in constituting the DRB by THDC and the rigid attitude of the DRB members, only four disputes could be adjudicated upon by the DRB in a span of fourteen years. KCT appointed Mr. N.N. Singhal as nominee DRB member vide its letter dated 12.09.1996, whereas THDC appointed its nominee DRB member, Mr. V.V. Badareenarayana after five years and that too after repeated requests made by KCT and after completion of the original contract period. The tripartite agreement was signed by the DRB on 10.05.2002, i.e., six years after the appointment of KCT‟s nominee DRB member. Between November, 2002 to August, 2005, only four out of eleven disputes were decided and right up till 2006 no further progress was made by DRB.