Dismissed

Ms Vaishnavi Associates through Its Proprietor Namely Shri Ramakant Sharma v. Central Coalfields Limited and Ors.

Jharkhand HC18 Jan 2020WPC/6596/2014

Case brief

AI extract

What is this about?

This writ petition sought directions to allow a deposit for coal booked in an e-auction. The High Court held that an arbitration clause in the 2007 e-auction scheme was incorporated into the sale orders. Consequently, the Court dismissed the petition under Article 226, directing the petitioner to invoke the arbitration mechanism.

What did the court decide?

Writ petition dismissed with liberty to petitioner to invoke the arbitration clause for redressal of grievance.

Ms Vaishnavi Associates through Its Proprietor Namely Shri… — Arbitration | Jharkhand HC (2020)

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IN THE HIGH COURT OF JHARKHAND AT RANCHI W.P.(C) No. 6596 of 2014

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M/s Vaishnavi Associates a proprietorship concern through its Proprietor, namely Shri Ramakant Sharma, S/o Dwarka Singh, R/o Jharnadih, Chandrapura, P.O & P.S.-Chandrapura, Dist.-Bokaro, Jharkhand

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…… Petitioner

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Versus

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1.Central Coalfields Limited, having its office at Darbhanga House, Ranchi, P.O & P.S.-Kanke, Dist.-Ranchi, Jharkhand 2.The General Manger (Sales), Central Coalfields Limited having its office at Darbhanga House, Ranchi, P.O & P.S.-Kanke, Dist.-Ranchi, Jharkhand 3. The State Bank of India, Chandrapura Branch through its Branch Manager, having its office at Chandrapura, P.O & P.S.-Chandrapura, Dist.Bokaro, Jharkhand …… Respondents

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CORAM: HON'BLE MR. JUSTICE SANJAY KUMAR DWIVEDI

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--------- For the Petitioner :Mr. Ravi Prakash Mishra, Advocate For the Respondents-CCL : Mr. A.K. Das, Advocate : Mr. Shivam Utharsh Sahay, Advocate ---------

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06/Dated: 18/01/2020

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Heard Mr. Ravi Prakash Mishra, learned counsel for the petitioner and Mr. Shivam Sahay, learned counsel for the respondents-CCL.

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Petitioner has preferred this writ petition for direction upon the respondents to allow the petitioner to deposit a sum of Rs. 12,34,200/- (Rs. Twelve lakhs thirty four thousand two hundred only) towards deposit of the e-auction amount and to allow the petitioner to lift the coal as booked vide e-auction held on 29.01.2014 and 31.01.2014.

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Learned counsel appearing for the petitioner submits that the respondent came out with a scheme of e-auction of coal known as e- auction scheme, 2007. The said e-auction scheme, 2007 has been brought on record as Annexure-1 to the writ petition. He further submits that the petitioner participated in the e-auction on 29.01.2014 and 31.01.2014 and deposited a sum of Rs. 2,00,000/and 1,60,000/- towards earnest money through RTGS against e- auction of the coal in the account of MSTC Limited and Metal Junction Services Limited from the registered Bank account maintained with the State Bank of India, Chandrapura, District-

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Bokaro. He further submits that participation in the e-auction on 29.01.2014 conducted by MSTC Limited, petitioner was allotted 100 MT. of coal at the rate of 2258.80 per metric tonne and 300 metric tonne at the rate of 2457.52 per metric tonne. He further submits that the petitioner participated in the e-auction of coal conducted by the CCL through Metal Junction Services Limited on 31.01.2014, the petitioner was allotted 400 MT of coal at the rate of 1400 per metric tonne.

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Learned counsel appearing for the petitioner further submits that as per the instruction of the respondent-CCL, the petitioner requested its Banker namely, State Bank of India, Chandrapura to transfer the balance consideration amount of e-auction as per the instruction of the petitioner, the State Bank of India, Chandrapura Branch made an RTGS payment of Rs. 7,62,200/- on 05.02.2014 and UTR No. 40363 25947 was generated. The petitioner again deposited a sum of Rs. 4,72,000/- through RTGS on 08.02.2014 and UTR No. 14039305749 was generated. He further submits that the petitioner was under a bonafide believe that the amount of e- auction has already been credited in the account of the respondents as the amount was shown debited from the account of the petitioner. The petitioner visited Sales Department of C.C.L at Darbhanga House on 11.02.2014 and inquired about the payment made through RTGS on 05.02.2014 and 08.02.2014. The petitioner was informed that the amount has not been credited in the account of the respondents.

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Learned counsel appearing for the petitioner further submits that on that ground the amount of earnest money deposited has been forfeited by the C.C.L.

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Learned counsel for the respondents-CCL submits that in

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terms of Clause 9.1 of the said scheme the writ petition is fit to be rejected. The said clause No. 9.1 for ready reference is quoted herein below:-

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9.1 If after completion of e-Auction a successful bidder fails to make payment for the coal value including all other charges within the stipulated time, the proportionate EMD equivalent to the failed quantity shall be forfeited subject to the provisions at Clause 6.4 and/or Clause 6.5 of this document, and/or.

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Learned counsel appearing for the respondents-CCL further submits that there is arbitration Clause as 11.12 of the said scheme which reads as under:-

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11.12.In the event of any dispute, Bidder/Buyer is necessarily required to represent in writing to the General Manager(Sales) of the concerned coal company, who would deal with the same in a period of one month from such representation. Thereafter, if required the matter be determined by the Director-In-Charge of Marketing of the concerned coal company. Any interpretation of any clause of this will be subject to clarification by CIL, which will be deemed as firm and final. All disputes arising out of this scheme, or in relation thereto in any form whatsoever shall be dealt exclusively by way of arbitration in terms of the Arbitration and Conciliation Act, 1996. The arbitration shall be conducted at Calcutta at a place to be notified by CIL. The arbitrator shall be appointed by the Chairman and Managing Director, CIL upon written request in this behalf. The award rendered by the Arbitrator shall be final and binding on the parties. (The place of arbitration & nomination of arbitrator be varied appropriately in view of the Coal Company involved).

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This Court had considered arbitration clause and found that this matter arise out of a scheme wherein arbitration clause is there. In this connection reference may be made in the case of Giriraj Garj Vs. CCL reported in (2019) 5 SCC 192 , where the disputes has been referred to an arbitrator referred in para 6 to 7.4 as under:-.

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6.In the instant case, the learned Single Judge in the impugned order has erroneously taken the view that an arbitration clause would not stand incorporated in the individual sale orders entered into by Respondent 2 Coal Company and the appellant. The individual sale orders emanate out of the 2007 Scheme. The sale orders specifically state that they would be governed by the guidelines, circulars, office orders, notices, instructions, relevant law, etc. issued from time to time by Coal India Limited or Bharat Coking Coal Ltd., etc. As a consequence, the arbitration clause (i.e. Clause11.12) in the 2007 Scheme would stand incorporated in the sale orders issued thereunder.

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Clause 7 in the sale orders falls under the “single contract case” where the arbitration clause is contained in a standard form document i.e. the 2007 Scheme, to which

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there is a reference in the individual sale orders issued by Respondent 2 Coal Company. 7.1. The arbitration clause in the 2007 Scheme clearly states that :

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“ All disputes arising out of this scheme or in relation thereto in any form whatsoever shall be dealt exclusively by way of arbitration in terms of the Arbitration and Conciliation Act, 1996 .”

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(emphasis supplied)

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Russell in his commentary on arbitration has interpreted these words as follows:

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“ Disputes “in connection with”, “in relation to”, or “regarding” a contract . These words, which are frequently encountered and are to be given the same meaning, were at one time given a restricted interpretation, but are now well established as having a broad meaning … They may also be sufficient to catch disputes arising under another contract related to the contract containing the arbitration clause .”

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(emphasis supplied)

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7.2. In Renusagar Power Co. Ltd. v. General Electric Co. this Court observed that expressions such as “arising out of”, or “in respect of”, or “in connection with”, or “in relation to”, the contract are of the widest amplitude, and content. In Doypack Systems (P) Ltd. v. Union of India this Court observed that expressions such as — “pertaining to”, “in relation to” and “arising out of”, are used in the expansive sense, and must be construed accordingly.

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7.3. The words “in relation thereto” used in Clause 11.12 of the 2007 Scheme indicate that the clause would apply to all transactions which took place under the 2007 Scheme. This would include the sale transactions in the present case.

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7.4. In view of the above discussion, the view taken by the learned Single Judge is erroneous, and is hereby set aside. The appeal is allowed.

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In view of the above clause 11.12 of the said scheme and aforesaid judgment, this Court is not inclined to exercise its jurisdiction under Article 226 of the Constitution of India. Accordingly, the writ petition stands dismissed with liberty to the petitioner, if so advised, may invoke the arbitration clause for redressal of his grievance.

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(Sanjay Kumar Dwivedi, J.)

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Satayendra/

Ms Vaishnavi Associates through Its Proprietor Namely Shri Ramakant Sharma v. Central Coalfields Limited and Ors.

Case brief

What is this about?

What did the court decide?

Ms Vaishnavi Associates through Its Proprietor Namely Shri Ramakant Sharma v. Central Coalfields Limited and Ors.

Case brief

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