TaxTMI 
TaxTMI 
2022 (8) TMI 1462
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....f this matter are that petitioner claims to be a Private Limited Company engaged in the business of construction works for various government and private departments. It is stated that tenders were floated by the respondent - Haryana Shehri Vikas Pradhikarn in March, 2013 for the work as detailed therein. Bid of the petitioner, being the lowest was accepted and communicated vide letter dated 25.03.2013 with directions to start work immediately. It is pleaded that there was further enhancement in the scope of work allotted. However, dispute arose between the parties with the petitioner alleging that respondent had failed to perform contractual obligations on its part. It is stated that petitioner raised its claim before the Executive Engineer in terms of clause 25(A) of the Contract but no decision was taken by the Executive Engineer within sixty (60) days of the said notice. Consequently, petitioner invoked arbitration clause vide notice dated 29.09.2020. Thereafter, Chief Engineer appointed the learned Arbitrator to adjudicate all disputes and differences between the parties. Statement of claim was filed by the petitioner on 30.06.2021 and application for amendment of statement....
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....ers versus Union of India 2004 (2) RCR (Civil) 665, to submit that offending clause should be struck down. It is, thus, prayed that this petition be allowed. Heard learned counsel for the petitioner and have gone through the file with his able assistance. At the outset, it would be useful to refer to Clause 25(A)(vii), which reads as under:- "It is also a term of this arbitration agreement that where the party invoking arbitration is the contractor, no reference for Arbitrator shall be maintainable unless the contractor, furnishes to the satisfaction of the Engineer In charge of the work, a security deposit of a sum determined according to details given below and the sum so deposited shall, on the termination of the arbitration proceedings, be adjusted against the cost, if any, awarded by the Arbitrator against the claimant party and the balance remaining after such adjustment or whole sum in the absence of any such cost being awarded the whole of the sum will be refunded to him within one month from the date of the award. AMOUNT OF CLAIMS RATE OF SECURITY DEPOSIT i) For claims below Rs.10,000/- 2% of amount claimed. ii) For claims of Rs.10,000/- and A....
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....would be forfeited and paid to the other party. There was admittedly no provision of any refund or adjustment of the amount. The Hon'ble Supreme Court in M/s ICOMM Tele Limited's case(supra) has dealt with and discussed its earlier judgment in S.K Jain's case(supra) and observed as under:- "12. In S.K. Jain v. State of Haryana, (2009) 4 SCC 357, this Court dealt with an arbitration clause in an agreement which read as follows:- "11. Sub-clause (7) of Clause 25-A of the agreement reads as follows:- "25-A. (7) It is also a term of this contract agreement that where the party invoking arbitration is the contractor, no reference for arbitration shall be maintainable unless the contractor furnishes to the satisfaction of the Executive Engineer in charge of the work, a security deposit of a sum determined according to details given below and the sum so deposited shall, on the termination of the arbitration proceedings be adjusted against the costs, if any, awarded by the arbitrator against the claimant party and the balance remaining after such adjustment in the absence of any such costs being awarded, the whole of the sum will be refunded to him within one mon....
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....nd does not apply at all to the facts of the present case." All the questions and grounds sought to be raised by learned counsel for the petitioner are succinctly answered by the Hon'ble Supreme Court in M/s ICOMM Tele Limited's case (supra) itself while discussing S.K. Jain's case (supra). It is obvious that a clear cut distinction has been made in respect to the type of pre-deposit clause. Discussion of the judgement of S.K. Jain's case (supra) makes it crystal clear that such like clauses, which provide for adjustment and refund to the party making the deposit after the passing of the award are materially different from the clause which was under challenge in M/s ICOMM Tele Limited's case (supra).In case of M/s ICOMM Tele Limited's case (Supra), the objectionable clause 25 (viii) was struck down finding the same to be arbitrary." Thus, the question sought to be raised has been clearly answered against the petitioner. Learned counsel for the petitioner is unable to point out any distinguishing feature in the present writ petition which calls for interference. Insofar as the argument raised on behalf of the petitioner that once Chief Engineer has appointed Arbitrator o....