- (1.) The State of U.P. through Superintending Engineer, Upper Ganga Canal Modernisation Circle (World Bank) Bulandshahr, has preferred this First Appeal From Order No. 143 of 1998, from the judgment and decree dated 17.10.1997/28.10.1997 passed by the Civil Judge (Senior Division) Bulandshahr in Original Suit No. 88 of 1997 (State v. M/s Commanded Engineering Company Limited), and other connected Original Suit No. 868 of 1996 (M/s Commanded Engineering Company Limited v. State of U.P.), dismissing the suit to set aside the Arbitration award. The connected First Appeal From Order Defective No. 1947 of 2011 has been filed by the State of U.P. from the order of the District Judge, Bulandshahr dated 4.12.2008 in Misc. Case No. 85 of 2006 and judgment and decree/award dated 3.11.2003 by the Arbitrators, with a delay of 2 years and 274 days, alongwith an application for condonation of delay. 2. We have heard Shri Vishnu Pratap, learned Standing Counsel spearing for the State of U.P. as defendant/appellant in both the appeals. Shri S. Rajay assisted by Shri Vivek Saran appears for the respondent/claimant. The Facts 3. Brief facts giving rise to these two appeals by the State of U.P., are that an agreement was entered into and was signed on 6.3.1989 between the State of U.P. through Superintending Engineer, Upper Ganga Canal Modernisation Circle -I (World Bank) Bulandshahar, with M/s Coromandel Engineering Co. Ltd., New Delhi, jointly with M/s Rani Construction Company Private Limited, New Delhi for construction of 30 km. lined parallel Upper Ganga Canal from km. 197 to km. 227 in District Bulandshahr in the State of U.P.. The work generally comprised of excavation, earth work, Cement Concrete lining with paver and C.C. tile lining, fixation of pressure release valves, laying graded filter and perforated A.C. pipes etc. The contract was executed after an open competitive bidding, in which the work was entrusted to M/s Coromandel Engineering Co. Ltd. in a joint venture with M/s Rani Constructions Pvt. Ltd. 1/34, Flat No. 204 Gangaram Hospital Marg, Rejender Nagar, New Delhi -60 (for short -the claimant). The agreement provided for the work to start from 3.4.1989, with the stipulated date of completion on 2.10.1991, (in 30 months), with the cost of the work calculated at Rs. 19,04,52,350/ -, as per contract. 4. The agreement stipulated for arbitration by a panel of arbitrators. Clause 57 of the agreement providing for the arbitration is quoted as below: 57. ARBITRATION
(2.) ALL disputes or differences in respect of which the decision, if any, of the Engineer or the Employer has not become final and binding as aforesaid, shall on the initiative of either party in dispute be referred to the adjudication of three arbitrators. One arbitrator is to be nominated by the Employer, one by the Contractor and the third by the President of the International Chamber of Commerce, in the case of foreign contractors and Chairman, Central Water Commission in the case of local contractor. If either of the parties fail to appoint its arbitrator within sixty days after receipt of notice for the appointment of an arbitrator then the President of the International Chamber of Commerce, or the Chairman, Central Water Commission, as the case may be, shall appoint an arbitrator. A certified copy of the appointments made by the President/'Chairman' shall be furnished to both parties. The arbitration shall be conducted in accordance with the Rules of Conciliation and Arbitration of the International Chamber of Commerce, Paris in the case of foreign contractors and provisions of Indian Arbitration Act, 1940 or any statutory modifications thereof in the case of local contractors and shall be held in either case at such place and time in India as the Arbitrators may determine. The decision of the majority of the Arbitrators shall be final and binding upon the parties and the expenses of the Arbitration shall be paid as may be determined by the Arbitrators.
(3.) THE said arbitration/s shall have full power to open up, revise and review any decision, opinion, direction, certificate or valuation of the Engineer. Neither party shall be limited in the proceedings before such arbitrator/s to the evidence or arguments put before the Engineer for the purpose of obtaining his said decision. No decision given by the Engineer in accordance with the foregoing provisions shall disqualify him from being called as a witness and giving evidence before the arbitrator/s on any matter whatsoever relevant to the dispute or difference referred to the arbitrator/s as aforesaid. The reference to arbitration may proceed notwithstanding that the Works shall not then be or be alleged to be complete, provided always that the obligations of the employer, the Engineer and the Contractor shall not be altered by reason of the arbitration being conducted during the progress of the Works.;