M/S.P.G.N.CONSTRUCTION ENGINEERS AND CONTRACTORS v. M/S.SAI ENGINEERS, ENGINEERS AND CONTRACTORS
Case Details & Bench
- Court
- High Court of Kerala
- Hon'ble Judges
- ANTONY DOMINIC, J
- Judgment Date
- 2012-02-22
- Court Decision / Holding
- Application under Section 11(6) of the Arbitration and Conciliation Act, 1996 rejected; arbitration not appointed.
- Final Disposition
- Arbitration appointment denied; AR.No.49/2010 dismissed; no arbitrator to be appointed under Section 11(6).
Parties to the Case
Appellants / Petitioners
- M/S P.G.N. Construction Engineers and Contractors, a proprietary concern, represented by its proprietor
Respondents
- M/S Sai Engineers, Engineers and Contractors, a proprietary concern, represented by its proprietor
Legal Representation & Advocates
Counsels for Petitioners
- • Sri Meijo Kurian Puvathingal
- • Smt. Premy Meijo
Counsels for Respondents
- • Smt. P.A. Anitha
- • Sri. V.M. Krishnakumar
Case Synopsis & Summary
This Arbitration Request under Section 11(6) of the Arbitration and Conciliation Act, 1996 concerns a dispute arising from a contract between M/S P.G.N. Construction Engineers and Contractors (applicant) and M/S Sai Engineers, Engineers and Contractors (respondent) over a work order purportedly awarded by M/s KMC Constructions Ltd. The applicant contends that it executed the contract work according to Annexure-A1 dated 17.01.2007 and completed the work by 16.03.2007; Annexure-II (completion certificate) was issued by KMC Constructions Ltd. and running bills and the final bill were submitted with Annexure-VII dated 31.03.2007. The applicant asserts that despite the 30-day period, payment was not made; a notice dated 23.03.2010 sought appointment of an Arbitrator. The respondent disputes the existence and genuineness of the work order (Annexure-I) claiming it dated 30.08.2006 and that Annexure-R1(d) was cancelled; Annexure-R1(f) issued; later work awarded to Jayaprakash (Annexure-R1(c)). The respondent also disputes Annexure-II and payments made (Annexures-III/IV), arguing no valid arbitration clause or contract exists. The High Court, citing SBP & Company v. Patel Engineering Ltd and Bharat Rasiklal Ashra v. Gautam Rasiklal Ashra, held that when the genuineness of the arbitration agreement is disputed, it is for the High Court to adjudicate rather than refer to arbitrators. The application was rejected for lack of proof of a valid work order/arbitration clause. The judge concluded that the applicant failed to prove a valid work order and an arbitration clause, thus no arbitrator could be appointed.
Provisions of Law Cited
Legal Doctrines & Maxims
- Genuineness/Validity of arbitration agreement must be adjudicated by the High Court when disputed; arbitration clause cannot be enforced if the agreement is not genuine or valid.
Submissions & Arguments
Contentions of Appellants / Petitioners
The applicant contends that a valid work order, Annexure-A1 dated 17.01.2007, was issued and work completed by 16.03.2007 with completion certificate (Annexure-II) and payments evidenced by Annexures III–IV; final bill dated 31.03.2007; despite the 30-day payment period, no payment was made and a notice dated 23.03.2010 sought appointment of an Arbitrator. The applicant relies on documents signed by the respondent’s Project Manager indicating an agreement; thus there existed a contract with an arbitration clause. It argues that genuine arbitration is to be resolved by the arbitrator, but where the arbitration clause itself is disputed, the High Court must decide, not refer. Cites SBP & Company v. Patel Engineering Ltd and Bharat Rasiklal Ashra v. Gautam Rasiklal Ashra to support adjudicating genuineness.
Contentions of Respondents
The respondent disputes the authenticity of Annexure-I work order (dated 30.08.2006), alleging it was created by the previous Project Manager and his son; Annexure-R1(c)/(d)/(f) show cancellation and reallocation; there is no valid arbitration clause or contract; annexures II, III, IV are contested and payments under them are explained as authorized by Jayaprakash’s agreement with the applicant. Consequently, there is no basis for appointing an arbitrator; the court should reject the application under Section 11(6) as the arbitration agreement is not proven and genuineness is in dispute.
Cited Precedents (2)
| Case Name | Citation | Treatment | Explanation |
|---|---|---|---|
| SBP & Company v. Patel Engineering Ltd. | 2005 (8) SCC 618 | Positive | Cited to support the proposition that if the genuineness of the arbitration agreement is disputed, the High Court must adjudicate rather than refer to arbitration. |
| Bharat Rasiklal Ashra v. Gautam Rasiklal Ashra and Another | 2012 (2) SCC 144 | Positive | Used to reinforce the principle that the court decides on the validity/genuineness of arbitration clauses when disputed. |
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