M/S Haryana Packaids Pvt. Ltd. vs Indian Oil Corporation Ltd & Anr.
2009 Latest Caselaw 1971 Del

*          IN THE HIGH COURT OF DELHI AT NEW DELHI


                                                      Date of Reserve: April 16, 2009
                                                         Date of Order: May 11, 2009

+OMP 571/2008
%                                                                                11.05.2009
    M/s Haryana Packaids Pvt. Ltd.                                        ...Petitioner
    Through : Ms. Usha Mann, Advocate

       Versus

       Indian Oil Corporation Ltd. & Anr.                                 ...Respondents
       Through: Mr. M.M. Kalra, Advocate


       JUSTICE SHIV NARAYAN DHINGRA

1.     Whether reporters of local papers may be allowed to see the judgment?

2.     To be referred to the reporter or not?

3.     Whether judgment should be reported in Digest?


       JUDGMENT

1. This application under Section 14(1) (a) & (2) read with Section 11 (6)

and 11(8) of the Arbitration & Conciliation Act, 1996 (for short, "the Act") has

been made by the applicant/ petitioner with a prayer that this Court should

terminate the mandate of respondent No.2 as the Sole Arbitrator and appoint

the Micro and Small Enterprises Facilitation Council as new Arbitrator to

decide the disputes of petitioner within three months as provided under the

Act.

2. Brief facts relevant for the purpose of deciding this application are that

this Court passed an order dated 22nd July 1998, on an application under

Section 11 of the Act made by the petitioner, that the Director (Marketing

Division of Indian Oil Corporation) respondent No.2 herein shall act as the

Arbitrator and the disputes and the counter claims be referred to the Sole

OMP 571/2008 Haryana Packaids P. Ltd. v. Indian Oil Corp. Ltd. & Anr. Page 1 Of 3 Arbitrator i.e. respondent No.2. After that order, counsel for the petitioner

wrote letters to the Sole Arbitrator asking him to enter the reference on 21 st

August 1998, 21st September 1998, 24th October 1998 and 23rd November

1998.

3. The contention of the petitioner is that the petitioner received no

response from the arbitrator and the arbitrator did not enter into the

reference although the petitioner again reminded the arbitrator on 22 nd

January 1999, 5th May 1998, 26th July 1999 and 11th August 1999. Thereafter,

petitioner stopped writing letters to the Arbitrator and on 28 th October 2006,

another notice was sent by the petitioner asking the arbitrator to enter into

the reference. There was no response and the petitioner then moved an

application being IA No.8703 of 2007 in August 2007 which was dismissed by

this Court holding that such an application in a disposed of petition was not

maintainable. The petitioner herein then filed the present petition under

Section 14 asking this Court to change the Arbitrator with a prayer that a

fresh arbitrator be appointed.

4. Section 43 of the Act provides that the Limitation Act, 1963 shall apply

to the arbitration and to the proceedings in respect of the Act as it applies to

other proceedings in the Court. It is obvious that an application for removal of

an arbitrator, who is not acting, has to be made within a reasonable time. It

was obvious that the Arbitrator was not acting from the very beginning.

Letters of the petitioner from July 1998 till September 1999 did not evoke any

response from the Arbitrator. The petitioner was supposed to approach the

Court right away for change of arbitrator under Section 14 of the Act. Law

does not permit a person to sleep over his rights for long and then suddenly

OMP 571/2008 Haryana Packaids P. Ltd. v. Indian Oil Corp. Ltd. & Anr. Page 2 Of 3 wake up and approach the Court. The period of limitation for making an

application under any law for which no period of limitation is provided in the

schedule is years. Three years are to be counted when right to apply accrued.

The right to apply in the present case accrued initially in July 1998. However,

respondent had made an application for modification of this order which was

dismissed in December 1998. Thereafter, again petitioner had asked

respondent to appoint the arbitrator and give date of hearing but respondent

No.2 did not give any response. Thus, it was clear to the petitioner in 1999

that respondent No.2 was not acting as arbitrator. The right to move an

application for changing the arbitrator accrued to the petitioner in 1999 and

the application could have been made by the petitioner latest by 2002. The

petitioner made this petition in October 2008 i.e. after lapse of almost nine

years. This petition/ application is barred by limitation and is hereby

dismissed. No orders as to costs.

May 11, 2009                                             SHIV NARAYAN DHINGRA J.
rd

OMP 571/2008 Haryana Packaids P. Ltd. v. Indian Oil Corp. Ltd. & Anr. Page 3 Of 3