Delhi High Court
M/S. Hindustan Publicity Pvt. vs The Chief Area Manager, Northern ... on 17 August, 2001
Author: J Kapoor
Bench: J Kapoor
ORDER
J.D. Kapoor, J.
1. This is a petition under Section 11 of the arbitration and Conciliation Act 1996 seeking appointment of the arbitrator.
2. The petitioner company entered into the agreement with the respondent for canvassing commercial publicity business on northern railway properties. The agency was registered up to 31st March,1997. The registration was to be treated as continuous if the petitioner continued to give business worth Rs.20,000/- every year and submit earning statement Along with request for further renewal on usual renewal charges. Petitioner sent to the respondent different payments being renewal charges for display of advertisement hoardings indifferent railway properties as detailed in para 7 of the petition. Photocopies of each of the advertisement hoardings displayed on the sites in question is annexed and marked as annexure P25. The disputes that have arisen between the parties are detailed in para 13.
3. Then appointment of the arbitrator is resisted by the respondent mainly on the ground that the petitioner is debarred from canvassing commercial publicity business in view of the judgment of the Supreme Court in M.C.Mehta's case wherein direction were given that all the hoardings on the railway land should be removed. Apart from this the respondent has also contested the existence of the arbitration clause in the agreement.
4.
Clause 23 of the agreement which according to the petitioner is arbitration clause provides that in case of a dispute or difference regarding terms and conditions the decision of the Chief Public Relation Officer, Northern Railway, State Entry Road, New Delhi shall be final.
5.
With the direction of the Supreme Court in M.C.Mehta Case that all the hoardings on the railway land should be removed, the agreement if any, had ceased to be in existence from the date of the judgment of the Supreme Court. Without any liability of the respondent as the loan imposed by the Supreme Court was a circumstance beyond the control of the respondent. Moreover, the contract was also terminated as per clause 6(a) by giving 15 days notice.
6.
The only question for determination is whether the petitioner is entitled to get the dispute adjudicated upon by the arbitrator and if so up to which period.
7.
According to the learned counsel for the respondent, the Chief Relation Officer of the Northern Railway has been made the final authority to give the decision with regard to the disputes and differences as to the terms of the agreement and his decision in this regard is final.
8. The import and intent of clause 23 is that in case the parties differ or there are some disputes as to the terms of the agreement they will approach the Chief Public Relation Officer not for the arbitrating upon but for his decision. Parties also agreed that such a decision shall be final. The concept of getting the dispute decided by way of arbitration is altogether on different footing. arbitrator is approached whenever a party to the contract has any claim against the other party. after calling upon the party to prove its claim or counter-claim, the Arbitrator delivers the award. Such an award is always open to challenge if it suffers from patent illegality or vices referred in Section 34 of the Arbitration and Conciliation Act 1991.
9. In the instant case both the partes agreed that the decision of the Chief Public Relation Officer shall be final if there is a difference or dispute between the parties as to terms of agreement. Thus by no stretch of imagination the instant clause can be treated as an arbitration clause. The only course open to the petitioner is to approach the Chief Pubic Relation Officer for its grievances and obtain the decision of the Chief Public Relation Officer which shall be final.
10. Apart from this, the direction of the Supreme Court in M.C.Mehta case has also rendered the agreement as null and void from the date of the judgment. However , if there are any difference or disputes between the parties till the dat of the judgment of the Supreme Court, the same can be presented before the Chief Public Relation Officer of the Northern Railway for a decision which shall be binding and final upon both the parties.
11. In view of the foregoing reason, the petition deserves dismissal.
12. IA stands disposed of.
