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Judgment
The present petition has been filed under Section 11(6) of Arbitration & Conciliation Act, 1996 (hereinafter referred to as ‘the Act’) and seeks appointment of Arbitrator to adjudicate the disputes between the parties.
As per the admitted facts, the petitioner herein had entered into the work contract [LoA No. DELHI DIVISION-ENGG / 42-2019-20-W3/ 10254390015607 dated 13.02.2020] for updating, reconciling, certification and computerization for land plans for Stations falling in Delhi Division.
Petitioner, as per work order, conducted survey of some areas and submitted relevant documents. The objections pointed out by the Railways were also removed but there was no final verification. The work could not be completed by the petitioner due to non-availability of certain documents and revenue records and also for lack of cooperation from the Railways Department and it is in the abovesaid backdrop that the petitioner claims that it has suffered loss of Rs. 1,97,09,890.21/- with interest @ 18 % per annum. The abovesaid quantification of loss is as on 03.04.2026.
Petitioner, accordingly, prayed for appointment of Arbitrator in terms of clause 64 (1) of Indian Railways Standard General Conditions of Contract.
During course of arguments, learned counsel for respondent submitted that they would have no objection if a Sole Arbitrator is appointed, albeit, having a technical background, with the prescribed qualification. The qualification of Arbitrator in terms of clause 64.3(c)(iii) reads as under:-
“64.3(c)(iii): (i) Qualification of Arbitrator(s):
(a)Serving Gazetted Railway Officers of not below JA Grade level.
(b)Retired Railway Officers not below SA Grade level, one year after his date of retirement.
(c)Age of arbitrator at the time of appointment shall be below 70 years.
(ii)An arbitrator may be appointed notwithstanding the total number of arbitration cases in which he has been appointed in the past.
(iii)While appointing arbitrator(s) under Sub-Clause 64.(3)(a)(i), 64.(3)(a)(ii), 64.(3)(b)(i) & 64.(3)(b)(ii) above, due care shall be taken that he/they is/are not the one/those who had an opportunity to deal with the matters to which the contract relates or who in the course of his/their duties as Railway servant(s) expressed views on all or any of the matters under dispute or differences. A certification to this effect as per annexure- XVI shall be taken from Arbitrators also. The proceedings of the Arbitral tribunal or the award made by such Tribunal will, however, not be invalid merely for the reason that one or more arbitrator had, in the course of his service, opportunity to deal with the matters to which the contract relates or who in the course of his/their duties expressed views on all or any of the matters under dispute.”
Both the sides have no objection if such Arbitration is conducted under the aegis of Delhi International Arbitration Centre, New Delhi (DIAC) and the Sole Arbitrator is appointed by DIAC.
In view of the above, the petition stands allowed and disposed of with the following directions:-
The disputes between parties concerning LoA No. DELHI DIVISION-ENGG / 42-2019-20-W3/ 10254390015607 dated 08.10.2020 are referred to arbitration.
ii) The arbitration will held under the aegis of Delhi International Arbitration Centre, New Delhi (DIAC) and would be governed by the Rules of DIAC.
iii) DIAC shall appoint a Retired Railway Officer, not below SA Grade level to act as Sole Arbitrator while keeping in mind said clause i.e. clause 64.3(c)(iii).
iv) The Arbitrator would furnish a declaration in terms of Section 12 of the Act prior to entering into the reference.
All the rights and contentions of the parties are left open for adjudication by the learned Arbitrator.
vi) The parties shall approach DIAC within two weeks from today.