Delhi High Court
Naren Electric Company vs N.I.D.C. And Anr. on 4 October, 2004
Author: M Mudgal
Bench: M Mudgal
JUDGMENT
Mukul Mudgal, J.
1. This is an application under Sections 11(6) & 11(8)(b) of the Arbitration and Conciliation Act, 1996 seeking the appointment of Arbitrator.
2. Inspite of the order dated 13th April, 2004 no reply has been filed. There is no appearance for the respondent either. Learned counsel for the petitioner averred in this application that as per clause 9.1.1 of the contract between the parties providing for settlement of disputes by way of arbitration reads as follows:
"9.1.1. In case any dispute, difference or question shall at any time hereafter arise between the parties hereto in respect of the construction of these presents or concerning anything herein contained or arising out of these presents or as to the rights, liabilities, or duties of the said parties hereunder, or as to any question, claim, right, matter or thing whatsoever in any way arising out of or relating to the contract designs, drawings, specifications, estimates, instructions and/or any of the terms, clauses and conditions thereof 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 completion or abandonment thereof shall be referred to the sole arbitration of the person appointed by the Executive Director of the Company (N.I.D.C. Ltd., New Delhi). At the time of such appointment, the contractor shall not raise any objection against the appointment of the Arbitrator so appointed is a Government/ company Servant/Consultant, that he had to deal with the matters to which the contract relates and that in the course of his duties as Government/ Company servant/Consultant he had expressed views on all or any of the matters in dispute or difference. The arbitrator to whom the matter is originally referred being transferred or vacating his office or being unable to act for any reason. Executive Director as aforesaid at the time of such transfer, vacation or office or inability to act shall appoint another person to act as arbitrator in accordance with the terms of the contract. Such person shall be entitled to proceed with the reference from the stage at which it was left by the predecessor. It is also a term of this contract that no person other than person appointed by Executive Director as aforesaid should act as arbitrator."
3. It is submitted by the petitioner that on 10th February, 2003, a requisition for appointment of Arbitrator was made as per the said arbitration clause and has not been responded to up to date. This averment remains unrebutted. Accordingly, the petitioner is entitled to succeed in view of the following position of law laid down in Datar Switchgears Ltd. Vs Tata Finance Ltd. & Another reported as JT 2000 (Suppl.2) SC 226 wherein the relevant para 19 reads as follows:-
"19. So far as cases falling under Section 11(6) are concerned-such as the one before us-no time limit has been prescribed under the Act, whereas a period of 30 days has been prescribed under Section 11(4) and Section 11(5) of the Act. In our view, therefore, so far as Section 11(6) is concerned, if one party demands the opposite party to appoint an Arbitrator and the opposite party does not make an appointment within 30 days of the demand, the right to appointment does not get automatically forfeited after expiry of 30 days. If the opposite party makes an appointment even after 30 days of the demand, but before the first party has moved the Court under Section 11, that would be sufficient. In other words, in cases arising under Section , if the opposite party has not made an appointment within 30 days of demand, the right to make appointment is not forfeited but continues, but an appointment has to be made before the former files application under Section 11 seeking appointment of an Arbitrator. Only then the right of the opposite party ceases. We do not, therefore, agree with the observation in the above judgments that if the appointment is not made within 30 days of 11(6)demand, the right to appoint an Arbitrator under Section 11(6) is forfeited."
4. Accordingly, Mr. L. P. Srivastava, CE(NDZ-II) (Telephone No. 23015120) is appointed as Arbitrator. The parties to appear before the Arbitrator so appointed on 5th November, 2004 at 4 PM on which day the statement of claim will be filed by the claimant. The Arbitrator is directed to dispose of the reference not later than 4 months from the first date of hearing. The Arbitrator shall fix his fee after consulting the parties.
5. The petition stands disposed of accordingly.
