2023 (3) TMI 1420

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....Clause 25(viii) contained in general conditions of contract of the NIT (Note Inviting Tender) (Annexure P-1) between petitioner and respondents be declared as bad in law being arbitrary, unconstitutional, unconscionable and against the principles of the public policy and consequently for the issuance of writ in the nature of certiorari for quashing order dated 28.08.2019 (Annexure P-2) whereby petitioner has been asked to deposit 10% Deposit-at-call as per Clause 25(viii) and for setting aside of order dated 13.08.2019 (Annexure P-4) vide which application filed by the petitioner for recalling/review of the order Annexure P-2 in view of the judgment of the Hon'ble Supreme Court in "M/s Icomm Tele Ltd. vs. Punjab State Water Supply and Sewer....

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....on but also for quashing Clause 25(viii) of the contract dated 13.05.2015 containing a clause regarding pre-deposit. 3. Learned counsel for the petitioner submits that the arbitration clause before the Supreme Court in the case of M/s Icomm Tele Ltd. (supra) was identical and in such circumstances the present petition be allowed and clause 25(viii) of the contract be declared as unconstitutional. It is further prayed that the respondent authorities especially the Arbitrator be directed to proceed further with the matter without insisting on the pre-deposit of the 10% amount involved in the dispute. 4. Learned counsel for the respondents per-contra submits that the clause for pre-deposit has been upheld by the Supreme Court by a judgment r....

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....en specifically and clearly upheld by the Supreme Court in S.K.Jain vs. State of Haryana (supra), which is of a larger Bench decision. 7. We have heard learned counsel for the parties at length. 8. The clause that has been challenged by the petitioner is in the following terms:- "25(viii) It shall be an essential term of this contract that in order to avoid frivolous claims, the party invoking arbitration shall specify the disputes based upon facts and calculations stating the amount claimed under each claim and shall furnish a "deposit-at call" for ten percent of the amount claimed, on a scheduled bank in the name of the Arbitrator/Chairman of the Arbitral Tribunal, by his official designation who shall keep the amount in deposit till ....

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....sidering the validity of the said clause has held as under:- "28. For all these reasons, we strike down clause 25(viii) of the notice inviting tender. This clause being severable from the rest of clause 25 will not affect the remaining parts of Clause 25. The judgment of the High Court is set aside and the appeal allowed." 11. In the light of the aforesaid decision rendered by the Supreme Court in M/s Icomm Tele Ltd. (supra), which has considered absolutely an identical clause contained in the agreement between the parties and after doing so has struck down the said clause, it is not for this Court i.e. the High Court to consider the contention of the respondent and take a different view as that would be not just beyond the authority of ....