M/S Natraj Engineers Pvt. Ltd. v. The General Manager (Engineering)

162 of 2008/RB/MEPL/313 between the parties dated 30.12.2009 for manufacture and supply of Pre Stressed Mono-block Concrete Patna High Court REQ. CASE No.13 of 2012 (6) dt.11-01-20 Sleeper (pre-tensioned type) for Broad Gauge (1673 mm) to Drg. No. T-2496 to Suit 60 Kg.

#3. It is not in dispute that as per Clause 25, the agreement between the parties dated 30.12.2009 was governed by the Indian Railways Standard Conditions of Contract and hence the provision of Clause 2900 of the Indian Railways Standard Conditions of Contract would be applicable with respect to arbitration. It is also not in dispute that there was a dispute between the parties with regard to extension of D.P. with L.D. without PVC & with denial clause and hence imposition of L.D. and denial clause & not allowing PVC in case of Force Majeure (as given in clause 17 of C.A. ) is not as per the Contract Agreement and hence the petitioner had claimed that it was illegal and against the laws of India (Clause 23.1 of C.A.)-Contract Act & Sale of Goods Act and hence the petitioner has requested that for the Force Majeure period D.P. extension be given with PVC & without denial clause and for the period beyond Force Majeure D.P. extension be given without L.D. and if the respondents were not agreeable, then the closure of petitioner-Unit by Railway Board was against the Contract Agreement and the petitioner was entitled to be compensated for the losses suffered by it due to wrong closure of its unit and hence an Arbitrator was requested to Patna High Court REQ. CASE No.13 of 2012 (6) dt.11-01-20 be appointed for settlement of the dispute. The said request vide letter dated 27.01.2012 was rejected by the Railway vide its letter dated 27.06.2012, hence learned counsel for the petitioner requests that an independent Arbitrator be appointed for settlement of the aforesaid dispute between the parties.

#4. On the hand, learned counsel for the respondents submits that after letter dated 27.01.2012 the petitioner had again approached the respondents on 16.05.2012 for extending delivery period up to 31.12.2012, to which the respondents replied on

22.08.2012 agreeing to extend the D.P. up to 31.12.2012 with stipulation that it would be with LD, without PVC and with denial clause and in case of fall in PVC indices, benefit of the same shall be availed by purchaser Railway. On the basis of the aforesaid communications, both the parties entered into a subsidiary agreement dated 16.11.2012 with specific terms. Thus, learned counsel for the respondents submits that this request case has become infructuous and the petitioner must abide by the terms and conditions of the said agreement.

#5. In reply, learned counsel for the petitioner relied upon three decisions of the Apex Court in case of Indian Oil Corporation Limited vrs. SPS Engineering Limited, reported in 2011 (3) S.C.C. 507; in case of Bharat Sanchar Nigam Patna High Court REQ. CASE No.13 of 2012 (6) dt.11-01-20 Limited vrs. Motorola India Private Limited, reported in 2009 (2) S.C.C. 337 and in case of J.G. Engineers Private Limited vrs. Union of India and another, reported in 2011 (5) S.C.C.

#6. Relying upon those decisions, learned counsel for the petitioner submits that respondent-Railway cannot be a Judge in its own cause and for the purposes of this request case, the agreement mentioned by learned counsel for the respondents was not relevant as it was merely a subsidiary agreement and not a fresh agreement. Furthermore, there is no mention in the said subsidiary agreement about complete satisfaction of petitioner’s claim, rights or receipt of final payment. Thus, he claims that the said subsidiary agreement is not to be considered for the purpose of the instant request case and an Arbitrator be appointed to settle the dispute between the parties.

#7. Considering the averments made by learned counsel for the parties, no doubt, there was an agreement between the parties dated 30.12.2009, in which arbitration clause had been included by mentioning that the said agreement would be regulated by the Indian Railways Standard Conditions of Contract, clause 2900 of which provided arbitration. It is also clear that there was a dispute between the parties as per the terms of the Patna High Court REQ. CASE No.13 of 2012 (6) dt.11-01-20 agreement, which was refused on 27.06.2012, whereafter, this request case was filed on 14.09.2012.

#8. Had the matter ended there, it would not have been difficult for this Court to appoint an Arbitrator for the redressal of grievances of the petitioner, but there were subsequent developments, which had started prior to the filing of this case and had subsequently resulted in a subsidiary agreement between the parties on 16.11.2012. No doubt, it is a subsidiary agreement and not a fresh agreement. It is also true that no one can be a Judge in his own cause. But from a perusal of the subsidiary agreement it is quite apparent that the respondents have not decided the dispute themselves, rather the petitioner by its own freewill has entered into the said subsidiary agreement dated 16.11.2012, which provided that the said indenture witnesseth that in consideration of the promises, the parties to the said indenture agreed to abide by the terms and conditions given therein and the delivery period was extended up to 31.12.2012 with LD and without PVC and with denial clause. However, it was provided that in case of fall in PVC indices, benefit of the same shall be availed by purchaser Railway.

#9. In the said circumstances, although the said agreement was a subsidiary agreement, but it clearly dealt with respect to the dispute raised by the petitioner, whereafter both the Patna High Court REQ. CASE No.13 of 2012 (6) dt.11-01-20 parties had come to a specific agreement with respect thereto. Hence, I am of the view that the aforesaid decisions of the Apex Court cannot be made applicable to the above mentioned specific facts and circumstances of this case.

#10. Accordingly, this petition is disposed of with a liberty to the petitioner to raise a dispute either before this Court or before respondent-authorities, if it feels aggrieved by any act of the respondents, which may be in violation of the terms of the agreement i.e. original agreement followed by the subsidiary agreement after completion of the period provided in the subsidiary agreement. (S.N. Hussain, J) MPS/-