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2007 DIGILAW 556 (RAJ)

Delhi Assam Roadways Corporation Ltd. v. M/s Hindustan Copper Ltd.

2007-03-14

SHIV KUMAR SHARMA

body2007
JUDGMENT 1. - The applicant company has filed this application under Section 11(6) of the Arbitration and Conciliation Act, 1996 (for short 'the Act') seeking appointment of independent Arbitrator. 2. Contextual facts depict that the applicant company is engaged in business of transporting goods in both private and public sectors from one place to another place through a network of its branch offices spread all over India. One of the applicant's branch is situated at village Gothara near CISF Colony Post Khetrinagar District Jhunjhunu. The respondent No.2 vide work order No. HCL/HO/PROJ/TRANS/53.7 dated May 5, 200& required the applicant to lift and transport various quantities of finished copper and copper products from Khetri to various godowns/parties by trucks. In the course of performance of work the respondents withheld unreasonably a sum of Rs. 7,17,594/-. Because of the differences between the applicant company and the respondents, the applicant company vide various letters made request to the respondents to appoint Arbitrator in accordance with clause 24 of the agreement and when no action was taken by the respondents, the applicant approach this court under Section 11(6) of the Act. 3. The respondents filed reply to application and stated that the application was not maintainable on the following grounds: (i) The copy of the resolution of Board of Directors held on September 14, 2002 has not been annexed to the application. (ii) Every kind of non payment cannot be considered to be repudiation giving rise to the dispute. (iii) If a protest is not made at the time of payments, the contractor is not entitled to raise the dispute for non payment of his bills. (iv) Failure of contractor to fulfill all obligations will disentitle him for reference. 4. Learned counsel for the respondents vociferously canvassed that since the protest was not made by applicant at the time of payment of applicant was not entitled to raise the dispute for non payment of his payment. Magnifying the contentions raised in the reply, learned counsel urged that the application deserved to be dismissed as it was barred by limitation. Reliance was placed on (1) U.O.I. Vs. Shring Construction Co. (2006) 8 SCC 18 , (2) Group General Manager Vs. M/s. ONGC (AIR 1998 Madras 363) , (3) Jamadar Singh Vs. The Engineer-in-Chief (AIR 2000 Patna 200) , (4) Ratan Singh Vs. D.J. Jodhpur, 2006 (1) CDR 471 (Raj.) and (5) Mahesh Chand Vs. Reliance was placed on (1) U.O.I. Vs. Shring Construction Co. (2006) 8 SCC 18 , (2) Group General Manager Vs. M/s. ONGC (AIR 1998 Madras 363) , (3) Jamadar Singh Vs. The Engineer-in-Chief (AIR 2000 Patna 200) , (4) Ratan Singh Vs. D.J. Jodhpur, 2006 (1) CDR 471 (Raj.) and (5) Mahesh Chand Vs. U.O.I. (2002 WLC (Raj.) UC 399) . 5. Having pondered over the submissions of learned counsel for the parties and on weighing the material on record I am of the opinion that there is no force in the submissions of learned counsel for the respondents. The reasons are:- (i) The respondents did not state in the reply that the application was barred by limitation. (ii) The applicant gave notices on June 21, 2002, July 18, 2002 and September 29, 2003 to the respondents making request to appoint Arbitrator in accordance with clause 24 of the agreement but the respondents neither replied the notices nor ever raised objection about the period of limitation. In Jamadar Singh Vs. The Engineer-in-Chief (supra) the application for appointment of Arbitrator was held time barred because prior to filing the application under Section 11(6) no notice was given. It was observed in para 9 thus: "....Be that as it may, no notice was given or demand was raised by the petitioner before filing the instant application under Section 11(6) of the said Act. In that view of the matter, I am of the opinion that the instant application for appointment of Arbitrator for adjudicating a dispute is barred by limitation and it is not maintainable." 6. In the facts and circumstances of the case necessary directions are required to be issued under Section 11(6) of the Act. In (6) Datar Switchgears Ltd. Vs. Tata Finance Ltd. (2000) 8 SCC 151 , the Apex Court propounded thus:- (Para 19) "As far as Section 11(6) of the Arbitration and Conciliation Act, 1996 is concerned, if one party demands the opposite party to appoint an arbiterator 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. Only then the right of the opposite party ceases." 7. 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. Only then the right of the opposite party ceases." 7. As a result of the above discussion, I allow the application and appoint Hon'ble Justice Harbans Lal (Retired) as sole arbitrator to settle the dispute between the parties. The arbitrator may fix his fee and the time for the disposal of the dispute in the circumstances so warranted. Deputy Registrar (judicial) shall inform the Arbitrator accordingly.Application Allowed. *******