ASHIS KUMAR CHAKRABORTY,J. - (1.) This is an appeal under Section 37 of the Arbitration and Conciliation Act , 1996 (in short, "the Act of 1996") at the instance of the claimant against the majority decision passed by the Arbitral Tribunal on November 22, 2018 allowing the objection raised by the respondent with regard to maintainability of the arbitration proceeding. The appellant has also filed an application, GA No. 492 of 2019 praying for stay of operation of the said impugned majority decision of the Arbitral Tribunal.
(2.) Shortly stated, the facts leading up to the present appeal are that in response to the notice inviting tender issued by the respondent, State of West Bengal for improvement of Chakda-Bongaon and Kapa-Barajaguli Section of State Highway 1 under the West Bengal Corridor Development Project, the appellant being the Joint Venture of two companies, namely A. L. Sudershan Construction Company Limited and Mackintosh Burn Limited submitted the bid which was accepted by the respondent on August 12, 2005 and the contract price was fixed at Rs.79,96,70,805.00/-. The terms and conditions of the contract relating to the subject work were those stipulated in the conditions of the contract forming various parts, as well as those stipulated in the Condition of Particular Applications (hereinafter referred to as "the COPA") and the various sub-clauses thereunder. As per sub-clause 67.1 of the COPA any dispute of any kind whatsoever arising between the parties herein in connection with or arising out of the said contract would initially be referred in writing to the Disputes Adjudication Board (hereinafter referred to as "the DAB") for its decision. The said sub-clause further provided that unless the member or members of the DAB have been previously mutually agreed upon by the parties and named in the contract, the parties shall, within 28 days of the commencement date, jointly ensure the appointment of the DAB. The said sub-clause also contemplated, inter alia, that if the parties fail to agree upon the appointment of a replacement member of the DAB within 28 days from the date on which a member of the Board declines to act or is unable to act as a result of death, disability, resignation or termination of appointment the "appointing body" or the "official named in the Appendix to Bid" shall, after due consultation with the parties, appoint such member of the DAB and such appointment shall be final and conclusive. The said DAB was required to communicate its decision, on the disputes referred to it, within 84 days from the date of receipt of the reference of the disputes. As per sub- clause 67.3 of the COPA if either party is dissatisfied with the decision of the DAB or the DAB fails to give notice of its decision the parties shall attempt to settle such dispute amicably before the commencement of arbitration. However, unless the parties do not agree otherwise, arbitration may be commenced on or after fifty-sixth day after the day on which the notice of dissatisfaction was given, even if no attempt for amicable settlement has been made. Further, sub-clause 67.4 of the COPA contemplated that any dispute in respect of which the decision, if any, of DAB has not become final and binding under sub-clause 67.2 and amicable settlement has not been reached, such disputes between the parties herein shall be referred to arbitration of two Arbitrators (one be appointed by each party) and a Presiding Arbitrator be appointed by the Arbitrators.
(3.) It is the case of the appellant, despite its readiness, willingness and competence to complete the works under the contract within the stipulated date of completion due to delays and defaults on the part of the respondent and for reasons beyond its control the work was completed in the month of January, 2010. At this juncture, it is to be noted that in this case long after expiry of 28 days from the commencement date, on February 15, 2006 the parties had mutually appointed Shri Narendranath Roychaudhuri, retired Secretary of the Government of West Bengal, as the sole member of the DAB. The appellant claims that due to the delay in completion of the contract it had not only suffered huge loss but the respondent even refused to pay its legitimate dues. By a letter dated May 12, 2012 the appellant referred the disputes and differences arisen between the parties with regard to its claim against the respondent to Shri Raychaudhuri, the sole member of the DAB under Clause 67.1 of the COPA. However, by a letter dated May 27, 2012 Shri Raychudhuri informed the petitioner and the Project Director of the respondent that by letter dated December 29, 2010 he had already expressed that his service as the member of the DAB may not be required beyond January 31, 2011 and specific consent of both parties are required regarding his continuation as the member of the DAB. By a letter dated July 26, 2012 the petitioner informed Shri Raychaudhuri that it is agreeable in continuation of his service as a member of the DAB for adjudication of the disputes and differences in relation to the subject works. A copy of the said letter was also forwarded to the Project Director of the respondent seeking for his quick response. The Project Director of the respondent, being the competent authority of the respondent received the said letter dated November 26, 2012 but did not respond to the same. The respondent even did not make any proposal for appointment of a new member of the DAB. On April 26, 2012 the appellant wrote a letter dated November 26, 2012 to the Project Director of the respondent asserting that in view of the conduct of the respondent in not responding to the said letter dated July 26, 2012 it seems that process of adjudication through DAB is not possible and as such, it is entitled to invoke arbitration and refer the matter to the Arbitral Tribunal. By the said letter the appellant invoked sub- clause 67.4 of COPA and nominated a retired Chief Engineering of Metro Railway, Kolkata as its nominee Arbitrator and requested the respondent to appoint its nominee Arbitrator within 60 days. Thereafter, on March 15, 2013 the Project Director of the respondent issued a letter to the petitioner informing that as per sub-clause 67.4 of the COPA the respondent has appointed a retired Secretary of Housing Department of the Government of West Bengal as their nominee Arbitrator. Thereafter, both the Arbitrators appointed one retired Judge of this Court as the Presiding Arbitrator.;