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2025 DAILYLAW 6414 (JK)

M/S TBA INFRASTRUCTURE PRIVATE LIMITED v. UNION OF INDIA THROUGH CHIEF ENGINEER 31 ZONE AND ANR.

Arb P/3/2024 · 2025-08-29

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Judgment text

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Sr. No.07 IN THE HIGH COURT OF JAMMU & KASHMIR AND LADAKH ATSRINAGAR Arb P No.3/2024 M/s TBA Infrastructure Private Limited. …Petitioner. Through: Mr. Showkat Ali Khan, Advocate. Vs. Union of India and another. ….Respondent(s) Through: Ms. Rehana Qayoom, Advocate, vice Mr. T. M. Shamsi, DSGI. CORAM: HON’BLE THE CHIEF JUSTICE O R D E R 29.08.2025 1. The present petition has been filed under Section 11(6) of the Arbitration and Conciliation Act, 1996, seeking appointment of an arbitrator. 2. The petitioner having participated in the tendering process initiated by the respondents and having been declared as successful tenderer was, vide letter dated 24-25/04/2014, allotted work “Construction of certain Building, Fire Sub STN, Plant Room and other allied works at Kirchama”. After allotment of the work, a joint inspection of the site is stated to have been conducted by the parties and as regards the earth excavation, a huge difference was observed and noted by them. It is submitted that since the work which the respondents asked the petitioner to execute was beyond the scope of the contract and, as such, a deviation order was required to be issued. It is submitted that part of the contract was executed by the petitioner, however, some of the works could not be executed by the petitioner for want of requisite deviation order. It is submitted that in case the petitioner would have executed the work beyond the scope of the contract, the same would have resulted in huge financial losses to the him, therefore, the petitioner despite having been time and again asked to execute part of the work did not opted to execute the same without the deviation order which the respondents, despite having been asked for, have failed to issue. It is stated that since the deviation exceeds 30%, therefore, in terms of the contract, a fresh agreement was required to be executed by the respondents which they fail to execute. It is further submitted that respondents instead of issuing deviation order and redressing the grievances of the petitioner, resorted to issue a notice for cancellation of the contract with risk and cost factor. The petitioner replied the said notice by issuing a legal notice dated 25.09.2020 seeking reference of the disputes for arbitration. The respondents instead of redressing the grievances of the petitioner or appointing an arbitrator in the matter, issued a final notice for foreclosure of the contract conveying that in case the work is not executed by the petitioner, the contract shall be cancelled. However, after issuance of the notice dated 25.09.2020, the matter was under consideration before the respondents and vide letter dated 14th March, 2022, the contract period has also been extended till 8th November, 2023. However, on account of non-issuance of the deviation order, the work could not be executed, therefore, the contract by default, as stated, has come to an end. The petitioner thereafter, in terms of communication dated 6th June, 2021 (Annexure-XXI) is stated to have sought appointment of arbitrator which the respondents have failed to appoint. Hence, this petition. 3. Pursuant to the notice issued by this Court, the respondents had caused appearance and filed their response. The respondents in their reply, have, inter alia, submitted that the petition at hand is not maintainable for the reason that before approaching the Court in terms of Section 11(6) of the Act, the petitioner was required to follow the procedure as laid down in the contract agreement which he failed to do. Further, it is submitted that, in terms of Condition 70 of IAFW-2249, unless both the parties agree in writing, reference of disputes to arbitration, the arbitration shall not take place until completion of the work. Further, it is averred that site of work was handed over to the petitioner on May 6, 2014, and the assertion of the petitioner that site was not handed over to him in time is denied. The respondents have further asserted that the petitioner was required to execute the work within 24 months from the date of handing over of the site, however, the petitioner failed to complete the work despite granting extension of one and half year from 14th March, 2022. Accordingly, the respondents pray for dismissal of the petition. 4. The existence of the arbitration clause, as aforesaid, and its invocation by the petitioner vide noticedated 25.09.2020 read with communication dated 06.06.2021 is not disputed. 5. Although, as indicated earlier, the respondents have filed objections to the petition but during the course of hearing, learned counsel for the respondents pleads no objection in case the petition is allowed. 6. In the given facts and circumstances, coupled with statement made at the Bar by learned counsel for the respondents, the petition is allowed. Accordingly, with consent of learned counsel for the parties, Sh. Vijender Kumar Jain, Retd. Chief Engineer, Railways 3rd Floor Plot no.429 B Block Sushant Lok Phase-1 Sec 43 Gurugram Haryana Pincode 122009, is appointed as the sole arbitrator. Who shall proceed with the matter in accordance with the provisions of the Act. And to make an award within the time provided in the Act itself after charging the prescribed fee along with incidental expenses to be shared by the parties. 7. Registry to send a copy of this order to the learned arbitrator. (ARUN PALLI) CHIEF JUSTICE Srinagar 29.08.2025 Abdul Qayoom, Secy. Abdul Qayoom Lone I attest to the accuracy and authenticity of this document 01.09.2025 14:02