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Rail Vikas Nigam Limited v. Simplex Infrastructures Limited
CASE ANALYSIS:
Rail Vikas Nigam Limited v. Simplex Infrastructures Limited.
FACTS OF THE CASE:
Rail Vikas Nigam Limited the petitioner of this case is the public sector that undertakes projects for Indian railways for construction of railways. The Rail Vikas Nigam Limited (petitioner) on 27th, September 2010 invited bid. The respondent accepted the petitioner’s invitation by submitting their bid via a letter. The parties entered into a contract soon after receiving the letter of acceptance by the petitioner. And therefore, the date of commencement was the same as the date on which the letter was issued which was on 28th December 2010.
At first the according to the terms of the contract the project was supposed to be completed by June 27th, 2013 but due to various reasons, the original time of completion of the project was extended, and by November 20th, 2017 the respondent completed the project. The respondent claimed that the petitioner failed to discharge the obligation promptly and that resulted in the delay of the completion of the project and therefore, the project which was supposed to be completed by 30 Months took 84 months, so, it escalated the cost for the petitioner. But the respondent's claim was not answered by the petitioner, the respondent invoked the arbitration clause. Since the petitioner failed to appoint an arbitrator the respondent approached the court and the court-appointed Mr. Swatanter Kumar as an arbitrator on behalf of the petitioner. And the fee would be given to the arbitrator according to the IV schedule.
The first sitting took place on 15th January 2019, Where the fee of the tribunal will be assessed according to the IVth schedule of the arbitration and conciliation act. The parties accordingly paid their part of the payment. In the eighth sitting which took place on 9th January 2020, the tribunal extended the rendering of the award for six months as the parties have only paid two installments of the ? 5 lakh each of the arbitrator’s fee as per Schedule IV which observed a pay of 49,87,500. Hence, the parties were granted four weeks to pay this amount.
The petitioner aggrieved by the fixation of the arbitrator’s fee on 27th February 2020, preferred an application before the learned Tribunal saying that the fee fixed according to the schedule IV is 30,00,000. On third March 2020, the tribunal examined the objections which were raised by the petitioner and rejected them. After four months since the petitioner’s objection was rejected by the tribunal on July 13th, 2020 the petitioner presented a petition seeking the termination of the tribunal of the three-member arbitrators.
ISSUE OF THE CASE:
The issue of this case was related to the interpretation of schedule IV entry no. 6 that is, whether the limit of 30,00,000/- is inclusive of the base fee of 19,87,500/-
JUDGMENT OF THE CASE:
The court observed that the petitioner has been unable to make out a case for termination of the mandate of the learned Tribunal. The court further said that according to the court the learned Tribunal has fixed the fees strictly as per Schedule IV of the Act, reiterating the settled principle of law that non-adherence to Schedule IV while fixing fee for arbitration can be a valid ground for termination, are wholly inapplicable to the facts of the present case. The petition, being meritless, is dismissed with no order as to costs.
This Article Does Not Intend To Hurt The Sentiments Of Any Individual Community, Sect, Or Religion Etcetera. This Article Is Based Purely On The Authors Personal Views And Opinions In The Exercise Of The Fundamental Right Guaranteed Under Article 19(1)(A) And Other Related Laws Being Force In India, For The Time Being.
- Case Analysis on Rail Vikas Nigam Limited v. Simplex Infrastructures Limited
- schedule IV
- arbitration and conciliation act
