Delhi High Court
National Thermal Power ... vs Gauri Shankar Agarwal And Co. on 4 March, 2005
Equivalent citations: 118 (2005) DLT 245, 2005 (81) DRJ 119
Author: V Jain
Bench: V Jain, J Singh
JUDGMENT
Vijender Jain, J.
CM No. 2897/2005
Allowed subject to all just exceptions.
W.P.(C) No. 3869/2005 and C.M. No. 2896/2005
1. This petition can be disposed of at this stage itself.
2. Petitioner has filed this petition impugning the order passed by learned Single Judge appointing the Arbitrator under Section 11 of the Arbitration and Conciliation Act 1996. Learned counsel appearing for the petitioner has contended that the Arbitrator could not have been appointed by the Court de horse clause 56 of the Arbitration Agreement which postulates appointment of the General Manager of the petitioner as Arbitrator. It was contended by learned counsel for the petitioner that the respondent has not sent any notice of the revocation. As a matter of fact it was the respondent who has abandoned the work and thereafter restarted the work. It is also contended on behalf of learned counsel appearing for the petitioner that there was dispute among the partners of the firm and, therefore, no action for appointment of the Arbitrator was taken by the petitioner.
3. We have perused the paper book as well as the impugned order. In view of the disputes between the parties, the respondent has invoked the arbitration clause as per clause 56 of the General Conditions of the Contract vide its letter dated 9.12.98. The petitioner has replied to the said letter vide its letter dated 4.1.99 which is at page 77 of the paper book. The last paragraph of the said letter is to the following effect:
In the above context, it is to inform you that NTPC, Korba, is not headed by General Manager designated at present and, therefore, we are examining and processing your request for appointment of the Arbitrator as per the arbitration clause of the contract.
This is for your information.
4. Thereafter, for three years nothing happened. There is nothing on the record to show that on account of abandonment of the work or restarting of the work or any disputes inter se between the partners the stand was taken by the petitioner that they were not in a position to appoint the Arbitrator. It was only after the respondent had filed the application in the Court in the year 2002, precisely on 3.1.2002, that the petitioner prays for sorting out disputes in the Court for non supply of the vacancy in terms of clause 56 of the Arbitration Agreement. Law is well settled in this regard. Once a party fails to supply the vacancy in terms of Arbitration Agreement after the expiry of 30 days from the notice invoking the Arbitration Agreement, the said party loses the right to supply the vacancy. This has been done to have speedy redressal of disputes by the method of constituting an arbitral forum. We have been told that the respondent has rescinded the contract in terms of their letter dated 11.10.99. It has been contended before us by learned counsel for the respondent that after the expiry of thirty days, as a matter of fact, the respondent has written to the Chairman/Managing Director of the petitioner for appointment of Arbitrator as the General Manager of the petitioner had failed to supply the vacancy in terms of clause 56 of the Arbitration Agreement. In spite of the said letter no vacancy was supplied by the Chairman/Managing Director of the petitioner.
5. The petitioner is a public sector undertaking and should have restrained itself from filing this application and should have accepted the verdict of the learned Single Judge as the named Arbitrator is a former Chief Justice (Retd.) of the High Court of Rajasthan .
6. The writ petition is dismissed with cost of Rs.10,000/- .
