LexLUDHIANA IMPROVEMENT TRUST & ANOTHER versus M/S. TODAY HOMES AND INFRASTRUCTURE (PVT.) LIMITED
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[2008] 14 S.C.R. 397 ,-__( LUDHIANA IMPROVEMENT TRUST & ANOTHER A v. M/S. TODAY HOMES AND INFRASTRUCTURE (PVT.) LIMITED (Civil Appeal No. 6104 of 2008) OCTOBER 14, 2008 B -l [ALTAMAS KABIR AND MARKANDEY KAT JU, JJ.] - Arbitration and Conciliation Act, 1996 - s. 11 (6) -Appli- cation for reference of dispute to arbitrator - Chief Justice of c High Court relying on judgment passed by Supreme Court, in view of s. 16 of the Act referring the issue to arbitrator - On appeal, held: The decision whereupon High Court placed re- liance, since was subsequently overruled by another decision of Supreme Court, matter to be decided in keeping with sub- D sequent judgment - Hence matter remitted to High Court. )( In an application u/s. 11 (6) of Arbitration an Concilia- tion Act, 1996, Chief Justice of High Court, relying on *Konkan Railway case held that in view of s. 16 of the Act, it was for the Arbitrator to decide the issue. Hence the E present appeal. Disposing of the appeal, and remitting the matter to High Court, the Court HELD: High Court, relying on the earlier Constitu- F ' tion Bench decision of this Court in the *Konkan Railway \ case left it to the Arbitrator appointed by it, to decide the issues u/s. 16 of the 1996 Act. This was contrary to the directions given by the seven-Judge Bench of this Court in the **Patel Engineering case, which categorically over- G ruled the decision in the Konkan Railway case. Therefore, the order of the Chief Justice is set aside and the matter t4" is remitted for a fresh decision in keeping with the deci- sion in Patel Engineering case. [Paras 17 and 18] [403 G- H, 404-A, 404-0] 397 H 398 SUPREME COURT REPORTS [2008] 14 S.C.R. A **S.B.P and Company vs. Patel Engineering Limited and Anr. 2005 (8) SCC 618 - followed. *Konkan Railway Corporation Limited and Anr. vs. Rani Construction Private Limited 2002 (2) SCC 388 - referred to. B CASE LAW REFERENCE 2005 (8) sec 618 Followed. Para 17 -\.-- 2002 (2) sec 388 Referred to. Para 17 ... ' c CIVILAPPELLATE JURISDICTION : Civil Appeal No. 6104 of 2008 From the final Judgment and Order dated 4.4.2008 of the High Court of Punjab and Haryana at Chandigarh in Arbitration D Case No. 76 of 2007 K.K. Venugopal, Ravi Shanker Prasad, Ajay Pal, Nikhil Jain, Ashish Chopra, Ankur Talwar and Ru pa for the Appellants. x Shanti Bhushan, Mukul Rohatagi, Vivek Sibal, Sumesh I Dhawan, Jayashree Wad, Ashish Wad and Chirag S. Dave (for \ E M/s. J.S. Wad & Co.) for the Respondent. The Judgment of the Court was delivered by ALTAMAS KABIR, J. 1. Leave granted. F 2. This appeal has been filed by the Ludhiana Improve- -< ment Trust, through its Administrator, and the State of Punjab, )· against the order passed by the Chief Justice of Punjab and Haryana High Court in a petition filed by the respondent herein under Section 11 of the Arbitration and Conciliation Act, 1996 G (hereinafter referred to as 'the 1996 Act') for the appointment of an Arbitrator. In the said application, which was numbered as Arbitration Case No.76 of 2007, the appellants herein were '~ m·ade respondents. 3. The Ludhiana Improvement Trust (hereinafter referred H to as "the Trust") was constituted under the Punjab Town Im- LUDHIANA IMPROVT. TRUST & ANR. v. M/S. TODAY 399 HOMES & INFRASTRE. (PVT.) LTD. [ALTAMAS KABIR, J.] provement Act, 1922 (hereinafter referred to as "the 1922 Act") A ---( for the planned development of the city of Ludhiana. For the purpose of construction of the City Centre in Ludhiana, the Trust, with the intention of entering into a joint-venture with developers in the private sector, invited bids by a Request of Proposal docu- ment dated 15.3.2005. Bids were filed by interested parties by 8 10.5.2005 and evaluation of the Technical bids was completed by 16.5.2005. In the final evaluation the respondent was found -f- to be the highest bidder and a Letter of Intent was thereupon· issued to him on 18.5.2005 for development of the City Centre, Ludhiana. The said Letter of Intent was alleged to have been c approved by the Trust in its meeting held on 18.5.2005, which was attended by 7 out of its 10 members. 4. The records indicate that on being issued the Letter of Intent the respondent deposited an amount of Rs.3.72 crores with the Trust towards security for the purposes of the contract. D According to the Agreement, the respondent would ultimately be required to pay to the
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