- 1 - HC-KAR NC: 2026:KHC:3804 CMP No. 483 of 2025 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 22ND DAY OF JANUARY, 2026 BEFORE THE HON'BLE MR. JUSTICE ASHOK S.KINAGI CIVIL MISC. PETITION NO. 483 OF 2025 BETWEEN: KEC INTERNATIONAL LIMITED A COMPANY WITHIN THE MEANING COMPANIES ACT 1956 HAVING REGISTERED OFFICE AT RPG HOUSE, 463 DR. ANNIE BESANT ROAD WORLI, MUMBAI MAHARASHTRA 400030 ALSO AT BUILDING NO. 9A, 8TH FLOOR, DLF CYBERCITY, PHASE III, GURUGRAM, HARYANA 122002 REPRESENTED BY ITS AUTHORIZED REPRESENTATIVE MR. LOKESH GUPTA …PETITIONER (BY SRI. ADITYA NARAYAN., ADVOCATE) AND: 1. UNION OF INDIA ACTING THROUGH THE GENERAL MANAGER, SOUTH WESTERN RAILWAYS RAIL SOUDHA GADAG ROAD Digitally signed by SUNITHA K S Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2026:KHC:3804 CMP No. 483 of 2025 HUBBALI KARNATAKA 580020 2. SOUTH WESTERN RAILWAYS RAIL SOUDHA GADAG ROAD HUBBALI KARNATAKA 580020 REPRESENTED BY ITS GENERAL MANAGER 3. CENTRAL ORGANIZATION FOR RAILWAY ELECTRIFICATION CIVIL LINES 1. NAWAB YUSUF ROAD PRAYAGRAJ UTTAR PRADESH 211 001 REPRESENTED BY ITS CHIEF ADMINISTRATIVE OFFICER …RESPONDENTS (BY SRI. MADHUKAR M D., ADVOCATE) THIS CMP IS FILED UNDER SECTION 11(5) OF THE ARBITRATION AND CONCILIATION ACT, 1996., PRAYING TO (a) APPOINT HONBLE MR. JUSTICE S. GURURAJAN AS SOLE ARBITRATOR TO ARBITRATE THE DISPUTES THAT HAVE ARISEN BETWEEN THE PARTIES IN RESPECT OF WHICH THE PETITIONER HAS ISSUED THE NOTICE INVOKING ARBITRATION DATED 26.05.2025 (ANNEXURE - R), IN VIEW OF THE CLAUSE 64 OF THE GENERAL CONDITIONS OF CONTRACT (ANNEXURE - Z) FORMING PART OF THE CONTRACT DATED 15.09.2020 (ANNEXURE - E) IS INEFFECTIVE FOR THE REASONS SET OUT THEREIN OR, IN THE ALTERNATIVE, (b) APPOINT AN APPROPRIATE PERSON AS THIS HONBLE COURT DEEMS FIT AS THE RESPONDENTS NOMINEE ARBITRATOR, AND FURTHER DIRECT SUCH ARBITRATOR, TOGETHER WITH THE PETITIONERS NOMINEE ARBITRATOR (HONBLE MR. JUSTICE S. GURURAJAN), HON’BLE JUDGE, HIGH COURT OF KARNATAKA) TO NOMINATE/APPOINT THE PRESIDING ARBITRATOR OF THE THREE MEMBER PANEL OF ARBITRATORS FOR ADJUDICATION, THROUGH ARBITRATION, OF THE DISPUTES THAT HAVE ARISEN BETWEEN THE PARTIES - 3 - HC-KAR NC: 2026:KHC:3804 CMP No. 483 of 2025 AND IN RESPECT OF WHICH THE PETITIONER HAS ISSUED THE NOTICE INVOKING ARBITRATION DATED 26.05.2025 (ANNEXURE - R) IN TERMS OF CLAUSE 64 OF THE GENERAL CONDITIONS OF CONTRACT (ANNEXURE - Z) FORMING PART OF THE CONTRACT DATED 15.09.2020 (ANNEXURE - E) THIS PETITION, COMING ON FOR ADMISSION, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE ASHOK S.KINAGI ORAL ORDER 1. This Civil Miscellaneous Petition is filed under section 11(6) of the Arbitration and Conciliation Act 1996 ( for short ‘ the Act’) seeking for the appointment of the Arbitrator in terms of clause 64 of the General Conditions of Contract forming part of a contract dated 15.09.2020 vide Annexure Z and E as per the provisions of the Act. 2. Brief facts, leading rise to the filing of this petition are as follows: 3. The petitioner and Respondent No.3 executed a contract dated 15.09.2020 pursuant to the tender floated by Respondent No. 3 for execution of the electrification - 4 - HC-KAR NC: 2026:KHC:3804 CMP No. 483 of 2025 works. The petitioner completed the work within the revised time lines and received a competition certificate on 30.08.2024. The petitioner raised claims for price variation, and compensation for extended stay and lockdown losses. However, the claims were not accepted. The petitioner issued a notice on 01.08.2024 of dispute and sought for appointment of the Conciliator. The respondents failed to appoint conciliator. Thereafter the petitioner sought reference of the dispute to Respondent No. 2- general Manager of South Western Railway. However the decision of the General manager was not furnished to the Petitioner despite lapse of 120 days as required by the contract. The petitioner issued an arbitration notice invoking arbitration clause on 26.05.2025 and proposed the name of the arbitrator. Respondent No. 2 issued a reply stating that the dispute does not require arbitration and refused to nominate the arbitrator. Further, the petitioner again on 30.06.2025 reiterated its request regarding referring the dispute to - 5 - HC-KAR NC: 2026:KHC:3804 CMP No. 483 of 2025 the arbitration. There is no action on the part of the respondents in appointing the arbitrator. Hence, this petition. 4. Respondents filed a statement of objections contending that the petition is not maintainable either under law or on facts and is liable to be dismissed in limine and also disputed the arbitration clause. Accordingly, prays to dismiss the petition. 5. Heard the arguments of the learned counsel for the petitioner, and the learned counsel for the respondents. 6. Learned counsel for the petitioner submits that the arbitral dispute has arisen between the parties to the petition pursuant to the contract having entered into the parties regarding carrying out of electrification works. The petitioner invoked the arbitration clause by issuing an arbitration notice proposing the name of the arbitrator however, the respondents did not concur with - 6 - HC-KAR NC: 2026:KHC:3804 CMP No. 483 of 2025 the petitioner in appointing the arbitrator. Accordingly, prays to allow the petition. 7. Per contra, learned counsel for the respondents that the dispute which has arisen between the parties to the petition is not arbitral in nature and accordingly, prays to dismiss the petition. 8. Perused the records, and considered the submissions of the learned counsel for the parties. 9. The point, that would arise for consideration is as follows: “Whether the petitioner has made out a ground to refer the dispute to the Arbitration in terms of clause 64 of the General Conditions of the Contract vide Annexure-Z inclusive of Agreement dated 15.09.2020 as per the provisions of the Act?” 10. It is undisputed that the petitioner and the respondents entered into a contract dated 15.09.2020. - 7 - HC-KAR NC: 2026:KHC:3804 CMP No. 483 of 2025 In furtherance of entering into contract the dispute arose between the parties to the petition regarding compensation for extended stay and lockdown losses. The petitioner sought for appointment of the conciliator however the respondents did not concur in appointing the conciliator. The petitioner invoked the arbitration clause by issuing the Arbitration notice dated 26.05.2025 and 30.06.2025 respectively. However, the respondents did not concur with the petitioner in referring the dispute to the arbitration. 11. I have perused the Arbitration clause at, clause 63 and 64 of the general conditions of the contract vide Annexure Z, which reads as follows: (Clause 63.1 of GCC): Matters finally determined by the Railway. All disputes and differences of any kind whatsoever arising out of or in connection with the contract, whether during the progress of the work or after its completion and whether before or after the determination of the contract, shall be referred by the Contractor to the General Manager and the - 8 - HC-KAR NC: 2026:KHC:3804 CMP No. 483 of 2025 General Manager shall within 120 days after receipt of the Contractor's representation make and notify decisions on all matters referred to by the Contractor in writing provided that matters for which provision has been made in Clauses 8,18, 22(5), 39,43(2), 45(a) 55, 55-A(5), 57, 57-A, 61(1), 61(2) and 62(1) to xiii) B of the General Conditions of contract or in any clause of the special conditions of contract shall be deemed as ‘excepted matters’ (matters not arbitrable) and decisions of the Railway authority, thereon shall be final and binding on the contractor provided further that "excepted matters" shall stand specifically excluded from the purview of the arbitration clause. Clause 64 (1) of GCC: Demand for Arbitration: 64.(1)(i): In the event of any dispute or different between the parties hereto as to the construction or operation of this contract, or the respective rights and liabilities of the parties on any matter in question, dispute or difference on any account, or as to the withholding by the Railway of any certificate to which the contractor may claim to be entitled to, or if the Railway of any certificate to which the contractor may claim to be entitled to, or if the Railway fails to make a decision within 120 days, then and in any such case, but except in any - 9 - HC-KAR NC: 2026:KHC:3804 CMP No. 483 of 2025 of the “excepted matters” referred to in clause 63 of these conditions, the contractor, after 120 days but within 180 days of his presenting his final claim on disputed matters, shall demand in writing that the dispute or differences be referred to arbitration. The demand for arbitration shall specify the matters, which are in question or subject of the dispute or difference as also the amount of claim/itemwise. Only such dispute(s) or difference(s) in respect of which the demand has been made, together with counter claims or set off, given by the Railway, shall be referred to arbitration and other matters shall not be included in the reference. (a) The Arbitration proceedings shall be assumed to have commenced from the day, a written and valid demand for arbitration is received by the Railway. (b) The Claimant shall summit his claim stating the facts supporting the claim alongwith all relevant documents and the relief or remedy sought against each claim within a period of 30 days from the date of appointment of the Arbitral Tribunal (c) The railway shall submit its defence statement and counter claim(s), if any, within a period of 60 days of receipt of copy of claims from Tribunal, - 10 - HC-KAR NC: 2026:KHC:3804 CMP No. 483 of 2025 thereafter unless otherwise extension has been granted by the tribunal (d) Place of arbitration: The place of arbitration would be within the geographical limits of the division of the Railway where the cause of action arose or Headquarters of the concerned Railway or any other place with the written consent of both the parties. (iii) No new claim shall be added during proceedings by either party. However party may amend or supplement the original claim or defence thereof during the Course of arbitration proceedings subject to acceptance by the Tribunal having due regard to the delay in making it. (iv) If the contractor(s) does/do not prefer his/their specific and final claims in writing within a period of 90 days of receiving the intimation from the Railway that the final bill is ready for payment, he/they will be deemed to waived his/their claim(s) and the Railway shall be discharged and released of all liabilities under the contract is respect of these claims. (Clause 64(2) of GCC) Obligation during pendency of arbitration: - 11 - HC-KAR NC: 2026:KHC:3804 CMP No. 483 of 2025 Work under the contract shall, unless otherwise directed by the Engineer, continue during the arbitration proceedings, and no payment due or payable by the Railway shall be withheld on account of such proceedings, provided, however, it shall be open for Arbitral Tribunal to consider and decide whether or not such work should continue during arbitration proceedings. (Clause 64(3) of GCC) Appointment of Arbitration Tribunal. (a)(1) In cases where the total value of all claims in question added together does not exceed Rs. 10,00,000/- (Rupees Ten lakh only), the Arbitral Tribunal shall consist of a sole arbitrator who shall be a gazetted officer of Railway not below JA grade nominated by the General Manager in that behalf. The sole arbitrator shall be appointed within 60 days from the day when a written and valid demand for arbitration is received by the General Manager. (ii) In case not covered by Clause 64(2)(a)(1), the Arbitral Tribunal shall consist of panel of three Gazetted Railway officers not below, JA grade оr two gazetted Officers not below JA grade and a retired Railway officer, retired not below the rank of SAG Officer, as the arbitrators. For this purpose, the Railway will send a panel of more than 3 names of - 12 - HC-KAR NC: 2026:KHC:3804 CMP No. 483 of 2025 Gazetted Railway officers of one or more departments, of the railway, which may also include the name(s) of retired Railway Officer (s) empanelled to work as Railway Arbitrator to the Contractor within 60 days from the day when a written and valid demand for arbitration is received by the General Manager. Contractor will be asked to suggest to the General Manager atleast 2 names out of the panel for appointment as the Contractors nominee within 30 days from the date of despatch of the request by Rai1way. The General manager shall appoint atleast one out of them as the contractors nominee and will, also simulataneously appoint the balance number of arbitrators either from the panel or from outside the panel, duly indicating the "Presiding Arbitrator” from amongst the 3 Arbitrators so appointed. General Manager shall complete the exercise of appointing the Arbitral Tribunal within 30 days from the receipt of the names of Contractor's nominees. While nominating the arbitrators it will be necessary to ensure that one of them is from Accounts Department. An Officer of Selection Grade of the accounts Department shall be considered of equal status to the officers in SA grade of other Departments of the railway for the purpose of appointment of arbitrators. - 13 - HC-KAR NC: 2026:KHC:3804 CMP No. 483 of 2025 (iii) If one or more of the arbitrators appointed as above refuses to act as arbitrator, withdraws from his office as arbitrator, or vacates his / their office/offices or is/are unable to or unwilling to perform his functions as arbitrator for any reason whatsoever or dies or in the opinion of the General Manager fails to act without undue delay , the General Manager shall appoint new arbitrator/arbitrators to act in his/their place in the same manner in which the earlier arbitrator/arbitrators had been appointed. Such reconstituted Tribunal may at its discretion, proceed with the reference from the stage at which it was left by the previous arbitrator(s). (iv) The Arbitral Tribunal shall have power to call for such evidence by way of affidavits or otherwise as the Arbitral tribunal shall think proper, and it shall be the duty of the parties hereto to do or cause to be done all such things as may be necessary to enable the Arbitral Tribunal to make the award without any delay. The arbitral tribunal should record the day to day proceedings. The proceedings shall normally be conducted on the basis of documents and written statements. (v) While appointing arbitrator(s) under Sub-Clause (i), (ii) and (iii) above, due care shall be taken that - 14 - HC-KAR NC: 2026:KHC:3804 CMP No. 483 of 2025 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. The proceedings of the Arbitral Tribunal or award made by such Tribunal will however, not be invalid merely for the reasons 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 is in the course of his/their duties, expressed views on all or any of the matters under dispute. (b) (i) The arbitral award shall state itemwise, the sum and reasons upon which it is based. The analysis and reasons shall be detailed enough so that the award could be inferred therefrom. (ii)The party may apply for corrections of any computational errors, any typo-graphical or clerical errors or any other error of similar nature occurring in the award and interpretation of a specific point of award to tribunal within 60 days of receipt of the award. (iii)A party may apply to Tribunal within 60 days of receipt of award to make an additional award as to - 15 - HC-KAR NC: 2026:KHC:3804 CMP No. 483 of 2025 claims presented in the arbitral proceedings but omitted from the arbitral award. Clause 64(4) of GCC: In case of the tribunal, comprising of three members, any ruling or award shall be made by a majority of members of the tribunal in the absence of such a majority, the views of the presiding Arbitrator shall prevail. Clause 64(5) of GCC: Where the arbitral award is for the payment of Money, no interest shall be payable on whole or any part of the money for any period till the date on which the award is made. Clause 64(6) of GCC: The cost of arbitration shall be borne by the respective parties. The cost shall inter- alia include fee of the arbitrator(s) as per the rates fixed by the railway Board from time to time and the fee shall be borne equally by both the parties. Further, the fee payable to the arbitrator(s) would be governed by the instructions issued on the subject by railway Board from time to time irrespective of the fact whether the arbitrator(s) is/are appointed by the railway Administration or by the court of law unless specifically directed by Hon'ble Court otherwise on the matter. Clause 64(7) of GCC: Subject to the provisions of the aforesaid, arbitration and conciliation Act, 1996 - 16 - HC-KAR NC: 2026:KHC:3804 CMP No. 483 of 2025 and the rules thereunder and any statutory modifications thereof shall apply to the arbitration proceedings under this clause. 12. From the perusal of the arbitration clause it is evident that in the event of any dispute arises between the parties to the contract, if the railway fails to make a decision within 120 days, then a party shall demand in writing that the dispute or difference be referred to arbitration. Admittedly, the decision of respondent No. 2 was not made known to the petitioner even after lapse of 120 days, as required by the contract. The petitioner invoked the arbitration clause by issuing the arbitration notice proposing the name of the arbitrator. However the respondents did not concur in appointing the arbitrator. 13. Admittedly, the arbitral dispute has arisen between the parties to the petition and the same has to be resolved by the Arbitrator in terms of clause 64 of the General conditions of the contract forming the part of - 17 - HC-KAR NC: 2026:KHC:3804 CMP No. 483 of 2025 contract entered into between the parties to the petition. The petitioner has made out a ground to refer the matter to the arbitration. Accordingly, I answer the point in the affirmative. 14. In view of the above discussion, I proceed to pass the following order: ORDER i. The Civil Miscellaneous Petition is allowed. ii. Hon’ble Sri. Justice Ajith Gunjal, Former Judge, High Court Of Karnataka, is nominated as the Arbitrator to resolve the dispute between the parties to the petition in terms of clause 63 and 64 of the General conditions of the Contract vide Annexure Z as per the provisions of the Act and the Rules. iii. The Registry is directed to communicate the copy of this order to the learned Arbitrator and the Director of Arbitration and Conciliation centre, Bengaluru. - 18 - HC-KAR NC: 2026:KHC:3804 CMP No. 483 of 2025 iv. Pending application(s), if any, shall stand disposed of. Sd/- (ASHOK S.KINAGI) JUDGE SKS CT:KHV