1 CGHC010249952021 2026:CGHC:42347 NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR WPC No. 4108 of 2021 M/s Kashyap Construction Proprietor Sunil Kumar Kashyap S/o Komal Prasad, Aged About 35 Years. R/o - M.H. 5 Panch Building, Infront Of Durga Auti Office, District Durg (Chhattisgarh) ... Petitioner(s) versus 1 - State Of Chhattisgarh Through The Secretary, Public Work Department, Mahanadi Bhawan, Mantralaya, Nawa Raipur, District Raipur (Chhattisgarh) 2 - Engineer-In-Chief Public Works Department, Sirpur Bhawan, District Raipur Chhattisgarh 3 - Chief Engineer, Public Works Department, Raipur Zone, District Raipur Chhattisgarh 4 - Superintendent Engineer Public Works Department, Durg Circle, District Durg Chhattisgarh 5 - Executive Engineer Public Works Department Durg Chhattisgarh ... Respondent(s) (Cause Title downloaded from CIS Periphery) For Petitioner(s) : Mr. Abhyoday Tripathi, Advocate For Respondent(s) : Mr. Vivek Verma, Goverment Advocate SHYNA AJAY Digitally signed by SHYNA AJAY Date: 2026.09.30 17:43:05 +0530 2 SB: Hon’ble Mr. Justice Amitendra Kishore Prasad Order on Board 29/09/2026 1. By way of this petition, the petitioner seeks the following reliefs : 10.1 The Hon’ble Court may kindly be pleased to set- aside/quash the impugned order Dated 07/05/2015 (Annexure P/2) issued by the Chief Engineer, Public Work Department, Raipur Zone, District Raipur (CG). 10.2 The Hon'ble Court may kindly be pleased to quash dated 07.05.2015 & 26.04.2019 (Annexure P/2) issued by the respondent, Chief Engineer, PWD Raipur Zone, District Raipur. 10.3 The Hon'ble Court may kindly be pleased to direct the Chief Engineer, PWD Raipur Zone, District Raipur to decide the appeal of the petitioner as per the clause 28 of the contract. 10.4 The Hon'ble Court may kindly be pleased to grant any other relief to the petitioner which this Hon'ble Court deems fit & proper in the facts & circumstances of the case, in the interest of justice. 2. Brief facts of the case are that Petitioner- M/s Kashyap Construction, was awarded a contract by the Public Works Department (PWD), Durg, for the construction of a 3.80 km 3 Cement Concrete Road at Achoti Albaras Nikum Marg, costing Rs.60 Lakhs with an initial completion date of 01.01.2014. Due to state-level administrative bans on sand mining, non-allotment of mine leases and delayed departmental payments, material availability was severely disrupted. Consequently, the PWD authorities granted time extensions up to 31.05.2014, by which date 74% of the work was completed. Subsequently, the entire project was completed on 01.09.2014 and a formal completion certificate was issued on 30.09.2014. Despite recommendations from the concerned Executive Engineer and without issuing a show-cause notice or providing an opportunity of hearing as mandated under Clause 5 of the subject contract/agreement, the Superintending Engineer imposed a penalty under Clause 2 (0.5% per week of delay). Being aggrieved, the petitioner preferred an appeal before the Chief Engineer, who erroneously rejected the same on the premise that no departmental appeal lay and the petitioner ought to directly invoke arbitration under Clause 28. 3. Learned counsel for the petitioner submits that the impugned order imposing penalty under Clause 2 was passed in gross violation of Clause 5 of the contract agreement and the principles of natural justice, as no opportunity of hearing was afforded prior to taking punitive action. He further submits that the Appellate Authority committed a patent error of law in holding that no departmental appeal was maintainable and in relegating the petitioner directly to arbitration under Clause 28. He further 4 submits that as per Clause 27 of the contract, the petitioner is required to first exhaust the administrative/departmental grievance redressal procedure before the Departmental Engineers and only upon an adverse determination thereunder can the arbitration clause under Clause 28 be invoked. 4. Learned State counsel supports the impugned order and submits that the completion of the project was delayed beyond the extended timeline. He submits that the terms of the agreement provide a specific mechanism for dispute resolution by way of arbitration under Clause 28 and therefore, the Appellate Authority rightly directed the petitioner to avail the remedy of arbitration rather than pursuing administrative appeals. 5. Heard learned counsel for the parties and also perused the documents annexed with the petition. 6. In the present case, the concerned Chief Engineer has committed an error of law in holding that no appeal is maintainable and that the petitioner ought to have directly invoked arbitration under Clause 28. Such a finding runs contrary to the explicit contractual terms. Under Clause 27 of the subject agreement, the contractor is required to first approach the concerned Executive Engineer or Superintending Engineer, as the case may be, for decision on the administrative grievance. It is only when the petitioner remains aggrieved by such decision that the remedy to invoke the arbitration mechanism under Clause 28 arises. Relegating the petitioner to arbitration prematurely, without exhausting the mandatory pre-arbitral administrative procedure prescribed under 5 Clause 27, is legally unsustainable. 7. In light of the foregoing discussion, the impugned order (Annexure P/2) is hereby set aside. The concerned Chief Engineer is directed to decide the petitioner's appeal on its merits, in accordance with law. 8. It is made clear that this Court has not expressed any opinion on the merits of the case. Since only the preliminary issue of appellate jurisdiction has been decided by this order, the departmental appellate authority ought to decide the appeal in the first instance. Thereafter, if the petitioner remains aggrieved by the outcome, they shall be at liberty to invoke the arbitration clause in accordance with the terms of the subject agreement. 9. With the aforesaid observations/directions, the Petition is finally disposed of. Sd/- (Amitendra Kishore Prasad) Judge Shyna Ajay