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2001 DIGILAW 641 (DEL)

DELHI DEVELOPMENT AUTHORITY v. BUMBRAH ELECTRICAL CO.

2001-11-20

MUKUL MUDGAL

body2001
MUKUL MUDGAL ( 1 ) ( 2 ). With the consent of the parties, the matter is taken up today for final hearing. ( 3 ). This writ petition arises out of the contract for construction of 512 EWS Houses in Pocket-8, Block A, Sector 17, Rohini, Delhi. The work was awarded by the petitioner through its Executive Engineer (E) ED-7, DDA vide Letter-cum-Agreement dated 15th of November, 1985, bearing No. 11/ee/edvii/dda/85-86 to respondent No. thereinafter referred to as the "m/s Bumbrah ). However, due to certain difficulties in the completion of the contracted work, disputes arose under the said Agreement and the contract was accordingly terminated by the petitioner. Thereafter a Supplementary Agreement dated 23rd of December, 1989 was entered into between the parties and further extension of time was requested and granted by the petitioner s Letter dated 13th of April, 1993. Thereafter on 4th of July, 1994, M/s bumbrah by its Legal Notice repudiated the said contract allegedly on the basis of the non- cooperation on the part of the petitioner and its officials. ( 4 ). It is the plea of the learned counsel for the petitioner that the repudiation made by the m/s Bumbrah vide its Letter dated 4th of July, 1994 was not received by the petitioner and the work was abandoned by the M/s Bumbrah wilfully. ( 5 ). Owing to the disputes occurring between the parties on 7th of May, 1996, the M/s bumbrah applied for the appointment of the Arbitrator as per the Arbitration Clause 25 of the agreement dated 15. 11. 1985. Since the petitioner did not respond to M/s Bumbrah s application for appointment of an arbitrator as per Clause 25, on 17th of October, 1997, the m/s Bumbrah filed an Arbitration Application under Section 11 (6) of the Arbitration and conciliation Act, 1996 for appointment of the Arbitrator in which notice was issued on 18th of october, 1997 and was duly served upon the petitioner/respondent before the Additional district Judge on 6th of November, 1997. In January 1998 the petitioner by its Letter dated 6th of February, 1998 appointed its own Super intending Engineer (Full-Time Arbitrator) as the Sole Arbitrator in terms of Clause 25. In January 1998 the petitioner by its Letter dated 6th of February, 1998 appointed its own Super intending Engineer (Full-Time Arbitrator) as the Sole Arbitrator in terms of Clause 25. Being aggrieved with this appointment, the M/s bumbrah accordingly approached the Court and the Additional District Judge by its Judgement dated 7th of August, 1999, impugned in the present writ petition, appointed the Director (SE), dda, Vikas Sadan; as the Arbitrator. ( 6 ). Thereafter the Hon ble Supreme Court in Datar Switchgear Limited Vs. Tata Finance ltd. and Another reported in 2000 (3) Arb. LR 447 (SC) delivered a judgement stating the proposition of law contained in-Para 19 which 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 application 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. "it is not in dispute that the above position of law laid down by the Hon ble Supreme Court cover the present writ petition also. ( 7 ). "it is not in dispute that the above position of law laid down by the Hon ble Supreme Court cover the present writ petition also. ( 7 ). Accordingly, since this writ petition is covered by the aforesaid Judgement of the hon ble Supreme Court, no further orders required to be passed and the writ petition deserves to be dismissed and the writ petition is accordingly dismissed with no orders as to costs. However, in the interest of justice and with the consent of the learned counsel for respondent No. 1, who has no objection to the substitution of the impugned Order dated 7th of August, 1999, Shri N. S. Chakravarthy (Former Senior Director General, Deptt. of telecommunications), B-27b (1st Floor), Gangotri Enclave, Alaknanda, Kalkaji, New Delhi- 110019 is appointed as the Arbitrator in this matter to adjudicate upon the disputes between the parties in substitution of the impugned Order dated 7th of August, 1999. The Arbitrator to give his Award as far as possible within a period of four months from the date of receipt of this judgement in accordance with law. The Arbitrator to fix his fees in consultation with the parties. ( 8 ). In view of the above, the writ petition is accordingly disposed of with no orders as to costs. ( 9 ). A copy of this judgement alongwith requisite records be sent forthwith to the Arbitrator for necessary information and compliance thereof.