- (1.) HEARD Mr. Shubham Agrawal in support of this application.
(2.) THE applicant herein claims to have constructed some 125 houses for the respondent-Kanpur Development Authority. The agreement amount for the construction of the houses has been paid over to the applicant but the security deposit has been forfeited. It is to claim this security amount that the applicant wants the dispute to be referred for arbitration. The applicant is relying upon Clause-24 of the agreement between the parties, which Clause reads as follows: "clause 24. Except where otherwise specified in the contract the decision of the Chief engineer for the time being shall be final, conqlusive and binding on all parties to the contract upon all question relating to the meaning of the specifications, designs, drawings and instructions hereinbefore mentioned and as to the quality of workmanship or materials used on the work, or as to any other question, claim, right, matter or thing whatsoever in any way arising out of or relating to the contract, designs, drawings specifications, estimates, instructions, orders, or these conditions, or otherwise concerning the works, or the execution or failure to execute the same, whether arising during the progress of the work or after the completion or abandonment thereof the contract by the contractor, shall be final, conclusive and binding on the contractor. "
(3.) IT is material to note that an identical clause having this matter first came up for consideration before the Apex Court in The state of U. P. v. Tipper Chand reported in air 1980 Supreme Court, 1522 : (1980 All lj 749) where the clause provided as follows: "2. The suit out of which this appeal has arisen was filed by the respondent before us for recovery of Rs. 2,000 on account of dues recoverable from the Irrigation Department of the petitioner State for work done by the plaintiff in pursuance of an agreement, clause 22 of which runs thus: "except where otherwise specified in the contract the decision of the Superintending engineer for the time being shall be final, conclusive and binding on all parties to the contract upon all questions relating to the meaning of the specifications, design, drawing and instructions hereinbefore mentioned. The decision of such engineer as to the quality of workmanship, or materials used on the work, or as to any other question, claim, right, matter or things whatsoever, in any way arising out of or relating to the contract, designs, drawing specifications, estimates, instructions, orders, or these conditions, or otherwise concerning the works, or the. execution or failure to execute the same, whether arising during the progress of the work, or after the completion or abandonment of the contract by the contractor, shall also be final, conclusive and binding on the contractor. " The Apex Court (a Bench of three Judges)in the case of The State of U. P. (AIR 1980 sc 1522) (supra) observed on this clause as follows: "after perusing the contents of the said clause and hearing learned counsel for the parties we find ourselves in complete agreement with the view taken by the High Court. Admittedly the clause does not contain any express arbitration agreement. Nor can such an agreement be spelled out from its terms by implications, there being no mention in it of any dispute, much less of a reference thereof. On the other hand, the purpose of the clause clearly appears to be to vest the superintending Engineer with supervision of the execution of the work and administrative control over it from time to time. " The Court therefore held that it was not an arbitration clause.;