SHRI. GALI BABU NAIDU S/O GALI SUBBA NAIDU vs UNION OF INDIA

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HC-KAR
NC: 2026:KHC-D:16666
WP No. 104100 of 2026


CNR: KAHC020087732026



IN THE HIGH COURT OF KARNATAKA AT DHARWAD


TH
DATED THIS THE 7 DAY OF OCTOBER, 2026

BEFORE

THE HON'BLE MR. JUSTICE M.G.S. KAMAL

WRIT PETITION NO. 104100 OF 2026 (GM-RES)

BETWEEN:

SHRI. GALI BABU NAIDU S/O GALI SUBBA NAIDU
AGE. 57 YEARS, OCC. CIVIL CONTRACTOR,
TH
R/O 18, 28 A MAIN, A R LAYOUT,
TH
6 PHASE, J P NAGAR, BANGALORE 560078.
…PETITIONER



(BY SRI. SHIVASAI M. PATIL, ADVOCATE)

AND:

UNION OF INDIA,
CENTRAL PUBLIC WORKS DEPARTMENT,
DHARWAD PROJECT DIVISION-1,
CHIKKAMALLIGEWAD VILLAGE,
OPP. DAHRWAD HIGH COURT
DHARWAD, KARNATAKA 580007

NOW OFFICE LOCATED AT
“SHIVSHEEL”- MULTIPLEX COMPLEX,
OPPOSITE TO NEW BUS STAND,
GOKUL ROAD, HUBLI 580030, KARNATAKA
REPRESENTED BY THE EXECUTIVE ENGINEER
AND SENIOR MANAGER.
…RESPONDENT





Digitally signed
by BHARATHI
H M
Location: HIGH
COURT OF
KARNATAKA
DHARWAD
BENCH
Date:
2026.10.15
14:52:50
+0530


(BY SRI. M.B. KANAVI, ADVOCATE)
THIS WRIT PETITION IS FILED U/SEC. A-226 AND 227 OF THE
CONSTITUTION OF INDIA, PRAYING TO ISSUE WRIT OF MANDAMUS
DIRECTING THE RESPONDENT TO CONSIDER THE REPRESENTATION
DATED 27.04.2026 VIDE ANNEXURE -AB IN THE INTEREST OF
JUSTICE AND ETC.

THIS WP COMING ON FOR ORDERS, THIS DAY, ORDER WAS
MADE THEREIN AS UNDER:
CORAM: HON'BLE MR. JUSTICE M.G.S. KAMAL

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NC: 2026:KHC-D:16666
WP No. 104100 of 2026


CNR: KAHC020087732026


ORAL ORDER


1. Petitioner, who was awarded construction of permanent
campus of the Indian Institute of Technology, Dharwad
Phase 1A. SH: Miscellaneous Works as per Annexure-A
dated 04.07.2024 and the Agreement produced at
Annexure-B, is before this Court grieving termination of
the said contract by the respondent vide letter of
termination dated 18.04.2026.

2. Learned counsel for the petitioner submits that the reasons
for termination are unjustified and no willful default or
otherwise can be attributed to the petitioner. On the other
hand, it was default on the part of the respondent in not
complying with the terms of the contract, which resulted in
delay in completion.

3. He however submits that 70% of the work has been
completed. Given some more time, he would finish the
entire work.

4. Learned counsel for the respondent on the other hand
submits that the Agreement having been terminated, there
is no scope for renewal or extension of the same. He refers
to Clause 25 of the Agreement providing for settlement of

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NC: 2026:KHC-D:16666
WP No. 104100 of 2026


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disputes by conciliation and arbitration. That since serious
issues involving facts and law has been raised, he insists
parties be relegated to resolve their dispute through
arbitration and conciliation as per Clause 25 of the
Agreement.

5. Heard. Perused the records.

6. Dispute is pertaining to performance and breach of the
terms of the Agreement each alleging non-performance by
the other.

7. Clause 25 of the Agreement reads as under:
“Clause 25

Except where otherwise provided in the contract, all
questions and disputes relating to the meaning of the
specifications, designs, drawings and instructions
hereinbefore mentioned and as to the quality of
workmanship or materials used in the work or as to any
other question, claim, right, matter or thing whatsoever in
any way arising out of or relating to the contract, designs,
drawings, specifications, estimates, instructions, orders or
otherwise concerning the works or the execution or failure
to execute the same whether arising during the progress of
the work or after the cancellation, termination, completion
or abandonment thereof shall be dealt with as mentioned
hereinafter.

25.1 Conciliation: If the contractor considers any work
demanded of him to be outside the requirements of the
contract, or disputes any drawing, record or decision given
in writing by the Engineer-in-Charge; or if the Engineer-in-
Charge considers any act or decision of the contractor on
any matter in connection with or arising out of the contract
or carrying out of the work to be unacceptable and
disputed; such party may promptly refer such disputes and
Settlement of
Disputes by
Conciliation and
Arbitration

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amount claimed for each dispute to the Conciliator (Special
Director General or the Additional Director General
concerned with the work, as applicable) in the proforma
prescribed in Appendix XVII mentioned in Schedule F, under
intimation to the other party. The Conciliator may then
request each party to submit to him a brief written
statement describing the disputes and the points at issue.
Each party shall send a copy of such statement to the other
party. At any stage of the conciliation proceedings, the
Conciliator may request a party to submit to him such
additional information as he deems appropriate. When it
appears to the Conciliator that there exist elements of a
settlement which may be acceptable to the parties, he shall
formulate the terms of a possible settlement and submit
them to the parties for their observations. After receiving
the observations of the partles, he may re-formulate the
terms of a possible settlement in the light of such
observations. If the parties reach agreement on a
settlement of the disputes, they may draw up and sign a
written settlement agreement on non-judicial stamp paper
as per Stamp Act. The Conciliator shall authenticate the
settlement agreement and furnish a copy thereof to each
party. The termination of conciliation proceedings shall be
in accordance with Section 76 of The Arbitration and
Conciliation Act, 1996. No party shall be represented before
the said Conciliator by an advocate or legal counsel. The
conciliation proceedings shall be completed within 45 days
from the receipt of reference. This time may be enlarged by
15 days by the Conciliator. The conciliation proceedings
shall be deemed to have been terminated at the end of 60
days from the receipt of reference.

25.2 Arbitration: If the aforesaid conciliation
proceedings fail or the Conciliator fails to give proposal for
settlement within the aforesaid period, either party may
promptly give notice in the proforma prescribed in Appendix
XVIII, under intimation to the other party, to the Chief
Engineer or the Superintending Engineer concerned with
the work (as applicable), hereinafter referred to as the
Arbitrator Appointing Authority as indicated in Schedule F,
for appointment of Arbitrator.

However, a party may seek appointment of Arbitrator
without taking recourse to the process of conciliation
mentioned in sub-clause 25.1 above.

In the event of either party giving a notice to the Arbitrator
Appointing Authority for appointment of Arbitrator, the said

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Authority shall appoint Arbitrator as per the procedure
given below and refer such disputes to arbitration.

(a) Number of Arbitrators: If the contract amount is
less than Rs.100 crore, the disputes may be referred for
adjudication by a sole Arbitrator. If the contract amount is
Rs.100 crore or more, the disputes may be referred to an
Arbitral Tribunal of three Arbitrators.

(b) Qualification of Arbitrators: It is a term of this
contract that each member of the Arbitral Tribunal shall be
Graduate Engineer with experience in execution of public
works engineering contracts, and he should have worked
earlier at a level not lower than the Chief Engineer
(equivalent to level of Joint Secretary to the Government of
India).

The aforesaid educational qualification and work experience
shall be mandatory for appointment as Arbitrator.

The age of Arbitrator at the time of appointment shall not
exceed 75 years. An Arbitrator may be appointed
notwithstanding the total number of active arbitration cases
with him.

(c) Parties to select Arbitrator: Based on the criteria
specified above, a list of empanelled Arbitrators has been
prepared in CPWD, and the parties shall have option to
select an Arbitrator from the list sent to them.

25.3 Appointment of Sole Arbitrator: The parties may
opt for appointment of the Arbitrator of the Ministry of
Housing and Urban Affairs. In such cases, the party seeking
arbitration has to submit an express agreement in writing
as per Appendix XIX towards waiver of Section 12(5) of the
Arbitration and Conciliation Act, 1996 along with the notice
for appointment of Arbitrator in the proforma prescribed in
Appendix XVIII, under intimation to the other party. The
Arbitrator Appointing Authority shall, within 30 days of
receipt of the said notice, appoint Arbitrator of the Ministry
of Housing and Urban Affairs as Arbitrator in the matter,
provided the other party also submits waiver of Section
12(5), ibid in Appendix XIX within 7 days of the receipt of
the said notice.

Where any one of the parties does not opt for the Arbitrator
of the Ministry of Housing and Urban Affairs, or does not
submit the waiver agreement, the Arbitrator Appointing
Authority shall propose five Arbitrators from the list of

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CPWD Empanelled Arbitrators to the party seeking
arbitration under intimation to the other party within 15
days of receiving the notice. The party seeking arbitration
shall give his choice for one of them within 15 days of
receiving the list, and the Arbitrator Appointing Authority
shall appoint the chosen person as the Sole Arbitrator
within 15 days of the receipt of choice.

It is a term of this arbitration agreement that if the parties
fail to select, within the period prescribed above, an
Arbitrator of their choice from the list of CPWD Empanelled
Arbitrators forwarded to them, the Arbitrator Appointing
Authority shall himself select and appoint Arbitrator from
the said list.

25.4 Appointment of Arbitral Tribunal of three
Arbitrators: The Arbitrator Appointing Authority shall
prepare two separate lists of five Arbitrators each from the
list of CPWD Empanelled Arbitrators, and send one to the
party seeking arbitration and other to the responding party,
within 15 days of the receipt of notice. The parties will then
choose any one Arbitrator from the list provided to them
within 15 days of receipt of the list. The Arbitrator
Appointing Authority shall then appoint those chosen by the
respective parties as Arbitrators and also a third Arbitrator
from the list of CPWD Empanelled Arbitrators to act as
presiding Arbitrator, within 15 days of receipt of choice from
both the parties.

It is a term of this arbitration agreement that if the parties
fail to select, within the period prescribed above, an
Arbitrator of their choice from the list of CPWD Empanelled
Arbitrators forwarded to them, the Arbitrator Appointing
Authority shall himself select and appoint Arbitrator from
the said list.

25.5 Applicable Law: The provisions of the Arbitration
and Conciliation Act, 1996 (Act 26 of 1996) and any further
statutory modification or re-enactment thereof shall be
applicable. Further, the fast-track procedure for arbitration
contained in Section 29B of the said Act shall apply.

25.6 Fee payable to Arbitrator(s): The fee payable to
the arbitral tribunal shall be as per CPWD OM
No.2/2006/SE(TLC)/CSQ/137 dated 19.11.2019 (or latest
amendment), and shall be shared equally by both the
parties.

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25.7 Place of Arbitration: The place of arbitration shall
preferably be as mentioned in Schedule F. However, the
Arbitral Tribunal may decide the place in consultation with
both the parties.

25.8 Terms of reference: The Arbitral Tribunal shall
adjudicate on only such disputes as are referred to it by the
Arbitrator Appointing Authority and give separate award
against each dispute referred to him and shall give reasons
for the award in all cases where the total amount of the
claim by any party exceeds Rs.1,00,000.

25.9 Interest on Arbitration award: It is also a term of
this arbitration agreement that where the Arbitral award
against any dispute is for the payment of money, no pre-
suit and pendent elite interest shall be payable on any part
of the Arbitral award.”


8. In view of the aforesaid Clause providing for resolution of
dispute through arbitration and conciliation, this Court do
not see any reason to proceed further in this matter as the
same involves complex facts which cannot be gone into
under Article 226 of the Constitution of India.

9. Reserving liberty to the petitioner to avail such remedy as
may be available and permissible in furtherance to Clause
25 of the Agreement noted above, petition is disposed of .



Sd/-
(M.G.S. KAMAL)
JUDGE


SH
CT:VP
LIST NO.: 1 SL NO.: 74