Case: – M/s A K Engineers and Contractors Pvt. Ltd. v/s Union Territory of J&K and Ors; ARB P No. 13 of 2022
In this case the petitioner, a construction company, had been awarded a civil contract by the Union Territory of J&K for the design and construction of a Single Lane Bridge. According to the petitioner, after a public announcement to convert the single lane bridge into a double lane bridge, administrative actions were taken, and a revised Detailed Project Report (DPR) was prepared. The petitioner completed the construction of the Double Lane Concrete Bridge, but disputes arose regarding payment.
Despite repeated requests and a legal notice, the petitioner claimed that a significant amount remained unpaid. Having exhausted other options, the petitioner approached the High Court invoking Section 11(6) of the Arbitration and Conciliation Act for the appointment of an arbitrator.
The respondents contested the petition on the grounds that no valid contract existed for the construction of the Two Lane Bridge, and therefore, the arbitration clause did not apply. They argued that a mere public announcement did not constitute a valid contract, citing legal precedents to support their position.
The Hon’ble Court considered the arguments presented by both parties, and concluded that the issue of whether the subsequent work was part of the original contract was a matter for the arbitrator to decide under the principle of “competence-competence.”
In the above matter the Hon’ble High Court has observed as below:-
“24. If there is an additional work which is an integral part of the original contract which cannot be segregated, such a work has to be deemed to be part of that original contract and any dispute arising out of such integrated work would be amenable to arbitration if the original work agreement contains an arbitration clause. In my opinion, the double lane bridge which was constructed by the petitioner can be considered to be an integral part of the initial contract. The double lane bridge was not a separate work allotted to the petitioner or executed after the completion of the single lane bridge. In fact, once the said work of double lane bridge was approved by the respondent authorities, from the very beginning of the work, the work of the single lane bridge of which there is a contract and an arbitration clause gets mixed with the work of the double lane bridge and thus, by implication, the contract for the single lane bridge gets converted to double lane bridge and any dispute pertaining to any component of the original work of the single lane bridge cannot be separated and any other interpretation would be greatly prejudicial to the petitioner, and not yet detrimental to the interest of the respondents, in as much as it was only because of the urging and approval of the respondents that the petitioner executed the double lane bridge in lieu of a single lane bridge.

  1. In the present case though it has been strenuously, contended by the respondents that dispute is not arbitrable, however, the said contention cannot be accepted with certainty since the construction of the double lane bridge is intrinsically linked to the original work of construction of the single lane bridge regarding which there is an arbitration clause.”

Author of this article:

Adv. Ravish Bhatt,
Partner, R&D Law Chambers,
Dual Qualified Lawyer Solicitor | International Tax Affiliate

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