Hon'ble Judges/Coram:
R.V. Raveendran and J.M. Panchal

JUDGMENT

R.V. Raveendran, J.

1. Leave granted. Heard learned Counsel for both parties. The matter relates to interpretation of Sub-section (5) of Section 7 of Arbitration and Conciliation Act, 1996 ('Act' for short) and the issue involved is whether an arbitration clause contained in a main contract, would stand incorporated by reference, in a sub-contract, where the sub-contract provided that it "shall be carried out on the terms and conditions as applicable to the main contract."

2. The Public Works Department, Government of Kerala, (in short `PW Department') entrusted the work of "Four Laning and Strengthening of Alwaye - Vyttila and Aroor - Cherthala and Strengthening of Vyttila to Aroor Section of NH 47 - N2 & N3 packages" which included the work of "Construction of Project Directorate Building for National Highway Four Laning Project at Edapally, Cochin" to the respondent. The said contract between PW Department and the respondent contained a provision for arbitration, as per Clause 67.3 of the General Conditions of Contract. The relevant portion of the said clause is extracted below:

Arbitration 67.3.

Any dispute in respect of which:

(a) the decision, if any, of the Engineer has not become final and binding pursuant to Sub-Clause 67.1, and

(b) amicable settlement has not been reached within the period stated in Sub-Clause 67.2. shall be referred to the adjudication of a Committee of three arbitrators. The Committee shall be composed of one arbitrator to be nominated by the Employer, one to be nominated by the Contractor and the third who will act as the Chairman of the Committee, but not as umpire, to be nominated by the Director - General (Road Development), Ministry of Surface Transport (Roads Wing); Government of India. If either of the parties abstain or fail to appoint his arbitrator, within sixty days after receipt of notice for the appointment of such arbitrator, then the Director- General (Road Development), Minis........