Delhi High Court
Pioneer Fabricators (P) Ltd. vs Indian Oil Corporation Ltd. And ... on 7 October, 2004
Equivalent citations: 115 (2004) DLT 673
Author: M Mudgal
Bench: M Mudgal
JUDGMENT
Mukul Mudgal, J.
1. This is an application under Sections 11(6) of the Arbitration and Conciliation Act, 1996 seeking the appointment of Arbitrator.
2. It is not in dispute that clause 18 of the agreement entered between the parties provides for appointment of the named Arbitrator and the appointment was to be made by the respondent. As per the arbitration clause, the petitioner made a requisition to the respondent on 16th January, 2002 which was not responded to by the respondent compelling the petitioner to move this Court by the present arbitration petition. Notice of the petition was issued on 31st May, 2004.
3. Learned counsel for the respondent, Mr. Kalra states that the Arbitrator has since been appointed after the filing of the petition. As per position of law laid down in Datar Switchgears Ltd. v. Tata Finance Ltd. & Another reported as JT 2000 (Suppl.2) SC 226, the right of the respondent to appoint Arbitrator got extinguished and hence the appointment of Arbitrator by the respondent after the filing of the petition is of no avail and stands set aside. The relevant para 19 of the judgment in Datar Switchgears (supra) 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 11(6), 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 demand, the right to appoint an Arbitrator under Section 11(6) is forfeited."
4. Accordingly, the petitioner is entitled to succeed and the petition is allowed. Ms. Kanwal Inder, a retired District Judge, D-1/106, Ravindra Nagar, New Delhi (Tel. 24694005) is appointed as an Arbitrator. The parties to appear before the Arbitrator on 23rd November, 2004 at 4.30 PM. The Arbitrator to fix her fees in consultation with the parties. Both the counsel agree that the Arbitrator be directed to dispose of the reference within six months from the first date of hearing. It is accordingly so directed.
5. This petition stands allowed and disposed of accordingly in the above terms.
