P.K.BALASUBRAMANYAN, J. - (1.) THIS appeal is filed by the petitioner in WP (C) No. 6754 of 2002. The appellant is a partnership firm and had entered into three contracts with the respondents. The appellant is hereinafter referred to as the contractor and the respondents as the Department of Road Construction.
(2.) THE contractor had entered into three contracts. Job No. 515 was the subject matter of the contract -dated 18.3.1999. It was for the widening of the national highway between kilometers 53 to 63. The second contract of even date related to Job No. 560, the widening of the national highway from kilometers 67 to 75. The third was Job No. 538 and the contractor entered into a contract for that on 2.7.2000 and it was also for widening of another strip of the national highway. The period for completion of the work in all these contracts was one year. The contractor approached this Court by taking the stand that he had completed the contracts relating to Job Nos. 515 and 516 and that only Job No. 538 remained to be completed. Even though Job Nos. 515 and 516 had been completed, the Department of Road Construction was not closing the agreements relating to those contracts and were seeking to adjust the amounts due to the contractor from Job No. 538, towards amounts allegedly due towards the contracts covering Job Nos. 515 and 516. The contractor prayed for the issue of a writ of mandamus directing the Department of Road Construction not to make any deduction of amounts from any other work undertaken by the contractor; to direct the Department of Road Construction to refund the amounts already so deducted and to declare that the communication informing the contractor of such deductions was ab initio void and illegal and that the amount covered by such deductions be refunded. The Department of Road Construction resisted the writ petition by contending that the disputes were pure disputes arising put of contracts and that the contractor was not entitled to approach this Court under Article 226 of the Constitution of India to have the disputes removed. It was also contended that towards the contract covered by Job Nos. 515 and 516, overpayments have been made and the Department of Road Construction was entitled to adjust such overpayments from the amounts due to the contractor and there was nothing illegal or improper in adjusting that part of the amount covered by over - payment. There was also no inequity in it. The learned Single Judge after referring to the case set out in the writ petition and in the counter - affidavit filed on behalf of the respondents came to the conclusion that certain grounds were mentioned in the counter affidavit for not closing contract Nos. 515 and 516 and in that background, the Court was not inclined to exercise its jurisdiction under Article 226 of the Constitution of India or to direct the respondents to close the contracts without taking into consideration all the aspects and the terms and conditions of the contracts. He held that regarding adjustments also, it was a fit case where the contractor was to be referred to the alternate remedy available to it under law by way of arbitration or by approaching the civil Court. The learned Single Judge found that no satisfactory decision could be rendered in the dispute between the parties on the materials made available. Thus, leaving the contractor to his remedy in a civil Court or elsewhere, the writ petition was dismissed.
(3.) CHALLENGING the dismissal of the writ petition, this appeal was filed. Apart from contending that the learned Single Judge should have decided the disputes in these proceedings itself without driving the parties to a litigation in the civil Court, counsel for the appellant, the contractor, sought to contend that there was an identical arbitration clause in the three agreements entered into between the parties and it was a fit case where this Court, in this appeal, should appoint an Arbitrator for taking a decision on the disputes. In fact on an earlier occasion when the matter came up and when this suggestion came up, the Division Bench presided over by the Chief Justice (this is mentioned in the context of Sec.11 (6) of the Arbitration and Conciliation Act, 1996), asked counsel for the Department of Road Construction whether the respondents were wiling to have an Arbitrator appointed in this proceeding, though this arose from a proceeding, initiated under Article 226 of the Constitution of India and the appeal was under Clause 10 of the Letters Patent. The contractor also filed an additional affidavit expressing its willingness to have the disputes arbitrated upon by any one of the persons mentioned in that affidavit, to be appointed as an Arbitrator by this Court. But counsel for the Department of Road Construction, on instructions, submitted that there was no arbitration clause in the agreements and the respondents were not in a position to agree to have an Arbitrator appointed in the circumstances. Counsel submitted that excess amounts have been paid towards contract Nos. 515 and 516 and all that has happened is to recover the said over payments by way of adjustment of the amounts due to the contractor and since nothing unjust or inequitable was involved, the respondents were not in a position to agree to the appointment of an Arbitrator. Counsel contended that the writ petition was not maintainable. He also pointed out that the works done in certain portions were found to be sub -standard quality and the contractor was asked to rectify the defects and the same remained to be done any in that situation, there is no question of any amount being due to the contractor or of the contracts being closed as claimed by the contractor.;