1. Heard Shri Shashi Nandan, learned Senior Counsel assisted by Shri Rahul Agarwal for the petitioner and Shri S.K. Srivastava, learned Counsel appearing for the respondents.

2. By this petition, petitioner has prayed for quashing the notice dated 10/6/2009, Annexure-1 to the writ petition by which the tender notice has been issued inviting tenders with regard to balance work of "Design, Supply, Erection, testing & Commissioning of 25 KV AC, Single phase 50 HZ Traction Overhead Equipments, Switching Stations, Booster Transformer Stations and LT Supply Transformer Stations". A writ of certiorari has also been prayed for quashing the notice dated 26/2/2009, Annexure-16 by which the termination notice has been issued for terminating the agreement dated 13/11/2008. A mandamus has also been sought commanding the respondents to allow the petitioner to work as per agreement awarded to him vide tender dated 29/8/2008 and further the respondents be directed to comply with the directions dated 13/4/2009 and 28/5/2009, issued by the higher authorities. Brief facts necessary to be noticed for deciding the writ petition are:

The petitioner is a registered company. A tender notice was issued on 24/12/2007 inviting tenders for "Design, Supply, Erection, testing & Commissioning of 25 KV AC, Single phase 50 HZ Traction Overhead Equipments, Switching Stations, Booster Transformer Stations and LT Supply Transformer Stations". Petitioner submitted his bid which was accepted by the letter dated 29/8/2008.An agreement between the petitioner and the authorities was entered on 13/11/2008. Petitioners case is that after the agreement, petitioner started mobilisation of work. A notice was issued to the petitioner on 16/2/2009 informing the petitioner that unless the work is completed as per the terms and conditions, the agreement will be terminated. Reply was submitted by the petitioner on 23/2/2009. Another notice was issued to the petitioner on 24/2/2009 by which the contract of the petitioner was terminated. Petitioner also represented the matter to the Railway Board. The Railway Board vide its order 13/4/2009 wrote to the General Manager to have a re-look over the matter. Another letter was issued by the Railway Board on 28/5/2009 referring to the earlier letters dated 24/4/2009, 13/5/2009 of the petitioner for reconsideration.

3. Learned Counsel for the respondents has informed that in pursuance of the letter of the Railway Board referred to above, the respondents have sent a letter dated 11/8/2009 informing the Railway Board reiterating its earlier decision to revoke the contract of the petitioner.

4. Shri S.K. Srivastava, learned Counsel appearing for the respondents has raised a preliminary objection regarding the entertainability of the writ petition. He submits that according to the terms and conditions of the tender, under Clause 1.2.54 of the tender document Group-139 (MOD) there is an arbitration Clause which is to be invoked by the petitioner on account of terms of contract and the writ petition be not entertained in view of the availability of the arbitration clause.

5. Learned Counsel for the respondents has placed reliance on the judgment of the Apex Court in Siemons Public Communication Pvt. Ltd. and Anr. v. Union of India and Ors. : AIR 2009 SC 1204 [LQ/SC/2008/2230] .

6. Shri Shashi Nandan, learned Senior Counsel appearing for the petitioner refuting the submission of the learned Counsel for the respondents contended that while terminating the contract of the petitioner the respondents have exercised their power under Clause 1.2.29 of the Special Conditions of Contract which is mentioned as "excepted matters" and Clause 1.2.54 cannot be invoked in the facts of the present case.

7. Learned Counsel for the petitioner further submits that although Condition No. 62 of the General Conditions of Contract has also been referred to in the impugned notice, but the General Conditions of Contract shall not be attracted in view of the special conditions of contract as incorporated in Clause 1.2.29.

8. We have heard learned Counsel for the parties and have perused the record.

9. The first issue to be determined is as to whether the petitioner has a remedy of invoking the arbitration Clause as provided under Clause 1.2.54 or not. The petitioners case is that the said Clause is not attracted, whereas the respondents submits that arbitration Clause is attracted in the present case and the writ petition be not entertained. Thus, we proceed to decide the said issue.

10. The letter of acceptance dated 29/8/2008, accepting the tender of the petitioner (Annexure-5) which contains Clause 4.0 is quoted below:

4.0 The contract shall be governed by the terms & conditions given in the Tender paper No ELCORE/OHE/Gr 139 (Mod) with A&O Slip No. 1.

11. Condition which is laid down in the tender document Group-139 (MOD) filed as Annexure-7 contains General Conditions of the Contract. Clause 17 of the Conditions provides as follows:

17. General Conditions of the Contract- General Conditions of Contract of concerned Railway as amended for advance correction slips issued up to date, shall be part of the contract. This may be obtained by the tenderer/contractor on payment from any Divisional Railway Managers office of concerned Railway in which the present Section lies.

12. The two relevant Clauses which have been referred to and relied on by both the parties are Clauses 1.2.29 and 1.2.54 which are quoted below:

1.2.29. Default And Delay: The contractor shall execute the work with due diligence and expedition keeping to the approved time schedule. Should he refuse or neglect to comply with any responsible orders given to him in writing by the Purchasers Engineer in connection with the work or contravene the provision of the contract or the progress of works lags persistently behind the time schedule due to his neglect, the Purchaser shall be at liberty to give seven days notice in writing to contractor requiring him to make good the neglect or contravention complained of and should the contractor fail to comply with the requisitions made in the notice within seven days from the receipt thereof, the purchaser shall be entitled after giving 48 hours notice in writing under the hand of the Contractors Engineer (to rescind the contract as a whole or in part or parts as may be specified in such notice) and action would be taken as per para-19 of Preamble.

Arbitration 1.2.54

(a) Matters Finally Determined by the Railway:

All disputes and differences of any kind whatsoever arising out of or in connection with the contract, whether during the progress of the work or after its completion and whether before or after the determination of the contract shall be referred by the contractor to the Railway Electrification and the Railway Electrification shall within 120 days after receipt of the Contractors representation make and notify decisions on all matters referred to by the contractor in writing provided that matters for which specific provision has been made in Clauses 1.1.10(b), 1.2.9, 1.2.14(a)(v), 1.2.14(d)(i), 1.2.14(d)(ii), 1.2.23, 1.2.29, 1.2.57, 1.2.59, 1.2.60, 1.2.61, 1.2.62, 1.3.2(j) and 1.3.17(c) of this tender paper shall be deemed as expected matters and decisions of the Railway electrification authority, thereon shall be final and binding on the contractor provided further that expected matters shall stand specifically excluded from the purview of the arbitration Clause and not be referred to arbitration.

(b)(i) Demand for Arbitration:....

13. The General Conditions of the Contract paragraph 62 has also been brought on the record as Annexure-25 which is quoted below:

62. Determination of contract owing to default of Contractor:

(1) If the Contractor should-

(i) becomes bankrupt or insolvent, or

(ii) make an arrangement with or assignment in favour of his creditors or agree to carry out the contract under a Committee of Inspection of his creditors, or

(iii) being a Company or Corporation, go into liquidation (other than a voluntary liquidation for the purposes of amalgamation or reconstruction), or

(iv) have an execution levied on his goods or property on the works, or

(v) assign the contract or any part thereof otherwise than as provided in Clause 7 of these conditions or

(vi) abandon the contract, or

(vii) persistently disregard the instructions of the Engineer, or contravene any provision of the contract, or

(viii) fail to adhere to the agreed programme of work by a margin of 10% of the stipulated period, or

(ix) fail to remove materials from the site or to pull down and replace work after receiving from the Engineer notice to the effect that the said materials or works have been condemned or rejected under Clauses 25 and 27 of these conditions, or

(x) fail to take steps to employ competent or additional staff and labour as required under Clause 26 of these conditions, or

(xi) fail to afford the Engineer or Engineers representative proper facilities for inspecting the works or any part thereof as required under Clause 28 of these conditions, or

(xii) Promise, offer or give any bribe, commission, gift or advantage either himself or through his partner, agent or servant to any officer or employee of the Railway or to any person on his or on their behalf in relation to the execution of this or any other contract with the Railway.

(xiii) (A) At any time after the tender relating to the contract has been signed and submitted by the Contractor, being a partnership firm, admit as one of its partners or employ under it or being an incorporated company elect or nominate or allow to act as one of its directors or employ under it in any capacity whatsoever any retired engineer of the gazetted rank or any other retired gazetted officer working before his retirement, whether in the executive or administrative capacity, or whether holding any pensionable post or not, in the Engineering Department of any of the Railways for the time being owned and administered by the President of India before the expiry of two years from the date of retirement from the said service of such Engineer or officer unless such Engineer or Officer has obtained permission from the President of India or any officer duly authorized by him in this behalf to become a partner or a director or to take employment under the Contractor as the case may be, or

(B) Fail to give at the time of submitting the said tender:....

(a)....

(b)....

(c)....

(d)....

(e)....

14. The termination notice which has been issued by the respondents dated 16/2/2009, Annexure-10 (wrongly mentioned as 16/2/2008) refers to in paragraph 10 specifically Clause 62. From paragraphs 4 to 9, breaches of various conditions of contract has been mentioned and paragraph 10 mentions that notice is given in accordance with Clause 62. Paragraphs 4 to 10 are quoted below:

4. As per contract condition 1.2.18a[i],within a period of 90 days from the date of LOA, the comprehensive schedule for the scheme of work shall be planned in a manner such that the entire basic designs and drawings are accepted by the purchaser with in a period not exceeding the 1/3rd of the total period allowed for and working drawings with in a period not exceeding 2/3rd of the total period allowed for completing the work. These have not been complied.

5. As per contract condition 1.2.18[c], you should furnish progress report in the first week of every calendar month, showing the progress of finalization of designs and drawings, materials and equipments received at site and the works carried out during the preceding month and up to date progress of these items. These have not been complied.

6. As per contract condition 1.2.22[a], you should set up at least one main depot for receiving and storing steel work and other materials and establish a workshop for small fabrication and assembly work. If considered necessary, sub-depots may be set up to ease operation of work trains and distribution of materials. Though Railway has allotted sufficient space at Kuzhithurai you have not constructed the depot so far and start functioning.

7. As per contract condition 1.2.35, you should have employed competent representatives to supervise the erection of equipment and carrying out of the works at all stages and your representatives shall be present at site during working hours. However, you have only one supervisor with inadequate qualification at site for carrying out foundation works.

8. As per contract condition 1.2.4, you should take out and keep in force a policy or policies of insurance against all liabilities of the contractor/purchaser at common law or under any statue in respect of accidents to persons who shall be employed by you for the purpose of carrying out works on the site. You should also take out and keep in force a policy or policies of insurance against all recognised risks to your offices and depots. These have not been complied.

9. As per contract condition 1.2.57, you should obtain a valid license under provisions of Contract Labour Regulation and Abolition Act as modified from time to time before commencement of work and continue to have a valid license until the completion of the work. Any failure to fulfil this requirement shall attract penal provisions of the contract arising out of resultant non-execution of the work. This has not been complied.

10. As you have failed to abide by the above conditions and to show adequate progress of work, you are hereby given seven days notice, in accordance with Clause 62 of the General Conditions of Contract, viz., to terminate your contract and initiate action to withhold amount towards "Performance Guarantee" and "Security Deposit". Also, the Mobilization Advance paid will be recovered in full with interest.

Please acknowledge receipt.

15. The notice on the basis of which the petitioners contract has been terminated specifically refers to Clause 62 i.e. General Conditions of the Contract and other clauses. As noticed above, the notice does not refer to Clause 1.2.29 for terminating the contract.

16. The submission of the learned Counsel for the petitioner is that the Special Condition of Contract shall prevail over the General Condition of Contract. A perusal of the Conditions of the Contract as mentioned in the tender document as well as Clause 17 as noticed above in which special condition of contract specifically makes General Conditions of the Contract applicable, thus the General Conditions of the Contract are also part of the Special Conditions of Contract. It was open for the Railway Authorities to have exercised their power under Clause 1.2.29 or under Clause 62 of the General Conditions of Contract. Referring to breach of other conditions, respondents have not chosen to exercise their power under Clause 1.2.29, rather they have chosen to invoke the power provided under Clause 62, General Conditions of Contract. Referring to specific breaches referred to in paragraphs 4 to 9 of notice dated 16/2/2009, the breaches of the special conditions of contract mentioned in paragraphs 4 to 9 are not included in any "excepted matters". Hence the submission of the learned Counsel for the petitioner that arbitration Clause 1.2.54 is not applicable cannot be accepted. The power under Clause 1.2.29 having not being invoked by the respondents nor any of the Clauses which are mentioned as "excepted matters" having been referred to or relied on, the dispute is fully covered by Clause 1.2.54 of the conditions of contract. The petitioner having remedy of arbitration under Clause 1.2.54, we are of the view that the writ petition cannot be entertained in view of the availability of arbitration clause. The judgment relied on by the learned Counsel for the respondents in Siemons Public Communication Pvt. Ltd. fully supports his case. We having taken the view that the petitioner has a remedy of invoking the arbitration Clause in the dispute raised consequent to termination of contract, we see no good ground to quash the notice dated 10/6/2009 inviting fresh tender for the balance work.

17. Subject to observation as made above, the writ petition is dismissed.