JUDGMENT 1. - This arbitration application under section 11(6) of the Arbitration and Conciliation Act, 1996 (in short "the Act of 1996") arising out of the two agreements issued with reference to the Notice Inviting Tenders issued by the Non-applicants for the financial year 2012-13 for supply of different items, which contained Arbitration Clause 8. 2. The facts stated in the arbitration application are as follows: 2(a) The Applicant - a company registered under the Companies Act, 1956, is carrying on the business of manufacturing and selling of pharmaceutical and FMCG products (medicines). A tender bearing No. F.01(01)/RMSCL/Procurement/2012/01 for the year 2012-13 was floated by the Non-applicants. The Applicant submitted its tender on 23.2.2012 and the same was accepted with the stipulation that different purchase orders would be issued to the Applicant from time to time, which should be followed by written agreements between the Applicant and the Non-applicants. In terms and conditions of the purchase orders, the Applicant entered into two Agreements (Anx.3 and 4) against PO No. 1059 and 1344 with the Non-applicants. The Applicant had sent the original agreement along with the Conditional Bank Guarantee covering 5% of the purchase order amount, duly signed in respect of P.O.No.1059 but did not send the Conditional Bank Guarantee for P.O.No.1344 because of the illegal withholding of the amount of the Applicant Company, for its earlier agreements for tender of the year 2011-2012 without assessing any reasons. In para 7, the Applicant has submitted that the Non-applicants tried to compel the Applicant to execute the agreement even without making payment of the earlier due amount which was not possible for the Applicant. 2(b) That by the conduct of the Non-applicants, a dispute arose between the parties which is directly related with the agreement executed between them and the agreement having Clause No. 8 for settling it in accordance with the Act of 1996. The Applicant by invoking Clause 8 of the agreement, served a notice on 20.7.2012 (Anx.6) for appointment of the Arbitrator in terms of the tender for the year 2012. Despite receiving the notice no reply was given therefore, a reminder letter cum name of the Arbitrator so appointed by the Applicant at its own end in terms of Clause 8 of the Agreement was communicated through registered letter dated 6.8.2012 (Anx.7). Despite receiving the notice no reply was given therefore, a reminder letter cum name of the Arbitrator so appointed by the Applicant at its own end in terms of Clause 8 of the Agreement was communicated through registered letter dated 6.8.2012 (Anx.7). The Non-applicants did not reply to the letter and the notice nor appointed the Arbitrator in terms of Clause 8 and tried to invoke the bank guarantee. When nothing was heard in this respect from the Non-applicants, the present arbitration application has been filed by the Applicant that the Non-applicants have failed to act as per the procedure given in Clause 8 of the agreement executed between the parties, therefore, they have forfeited their right to appoint another Arbitrator and an independent Arbitral Tribunal may be constituted by this Court for resolving the dispute between the parties. 3. The Non-applicants have filed reply to the arbitration application stating therein that the arbitration application is barred by limitation and further in reply to para 6, submitted that the Applicant did neither submit the security deposit nor supplied the medicines. As the Applicant had committed defaults in supply of drugs against the contract for the year 2012-13, its pending payments against the previous supplies were withheld. The withheld amount was to be adjusted against the security amount which the Applicant had failed to deposit against the agreement for the year 2012-13. The other pending amounts were also to be adjusted for recovering the difference amount of risk purchase by the Non-applicants from other suppliers at higher at higher rates. It is further submitted by the Non-applicant that no supply against the tender of 2012-13 has been made by the Applicant. It is also submitted that the Applicant firm has itself admitted in para 7 that the amount of the Applicant company already lying with the Non-applicant, which could have been adjusted in that case there is no dispute whatsoever between the Applicant and the Non-applicant on this count but there is no such admission in para 7 of the arbitration application wherein the averments are that the Non-applicants tried to compel the Applicant to execute the agreement even without making payment of the earlier due amount which was not possible for the Applicant. 4. 4. Submission of counsel for the Applicant is that a perusal of the arbitration application as well as reply clearly reveal that there is a dispute with regard to the release of the due payment and further, invoking the bank guarantee for which the first notice was given on 20.7.2012 (Anx.6) calling upon the Non-applicants to nominate their Arbitrator within fifteen days of the receipt of the notice and thereafter,the Arbitrator was nominated by the Applicants vide letter dated 6.8.2012 (Anx.7) but no Arbitrator was appointed by the Non-applicants within the said period and till the date of filing the present arbitration application i.e. 28.9.2012, therefore, the agreed procedure prescribed under Clause 8 of the arbitration agreement has not been followed by the Non-applicants and the Non-applicants have forfeited their right to appoint another Arbitrator and this Court has to invoke its power u/s 11(6) of the Act of 1996 to appoint an independent Arbitral Tribunal. 5. Submission of the counsel for the Non-applicants is that the arbitration application is barred by limitation and since there was breach of the agreement during the year 2012-13, the balance amount of the earlier agreement for the year 2011-12 was not released on account of making adjustment against the tender of 2011-12, therefore, there is no dispute and the Applicant is not entitled to appointment of an independent Arbitral Tribunal. 6. I have gone through record of the arbitration application and further considered the aforesaid rival submission of counsel for the parties. 7. Before proceeding further, it is necessary to reproduce arbitration Clause 8 of the agreement and further the relevant portion of the judgment in Punj Lloyd Ltd. v. Petronet MHB Ltd., (2006) 2 SCC 638 (three learned Judges' judgment) in para 5 whereof, Datar Switchgears Ltd. v. Tata Finance Ltd., (2000) 8 SCC 151 (2 learned Judges' Bench) of forfeiture of right of appointment of an Arbitrator after the expiry of thirty days of the notice or till the date of filing of the aritration application, has been affirmed. The same are as follows: Arbitration Clause 8 of the Agreement "8. In case of Dispute or difference arising between the Purchaser and a Supplier relating to any matter arising out of or connected with this agreement, such disputes or difference shall be settled in accordance with Arbitration and Conciliation Act, 1996. The same are as follows: Arbitration Clause 8 of the Agreement "8. In case of Dispute or difference arising between the Purchaser and a Supplier relating to any matter arising out of or connected with this agreement, such disputes or difference shall be settled in accordance with Arbitration and Conciliation Act, 1996. The arbitral tribunal shall consist of 3 arbitrator one each to be appointed by the purchaser and the Supplier. The third arbitrator shall be chosen by the two Arbitrator so appointed by the Parties and shall act as presiding arbitrator." Relevant Para 5 of Punj Lloyd Ltd. v. Petronet MHB Ltd., (2006) 2 SCC 638 "5. Having heard the learned counsel for the parties, we are satisfied that the appeal deserves to be allowed. The learned counsel for the appellant has placed reliance on the law laid down by this Court in the case of Datar Switchgears Ltd. v. Tata Finance Ltd. (SCC p.158, para 19) wherein this Court has held as under: "[S]o 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. 8. On consideration of the aforesaid submission with the objection of limitation with regard to the payment of contract for the year 2012-13 is wholly untenable as the limitation for filing the arbitration application is three years and the arbitration application has been filed before this Court on 29.8.2012. 9. As regards further submission of the counsel for the Non-applicants of withholding the due amount of the Applicant for the year 2012-13 for adjustment in respect of breach of the earlier agreement for 2011-12, the same will touch the merit of the case. 10. 9. As regards further submission of the counsel for the Non-applicants of withholding the due amount of the Applicant for the year 2012-13 for adjustment in respect of breach of the earlier agreement for 2011-12, the same will touch the merit of the case. 10. The submission of the counsel for the Applicant has force that the Non-applicants have forfeited their right to appoint an independent Arbitrator after filing of the present arbitration application i.e. 28.9.2012, therefore, in such circumstances, I deem it proper to appoint an independent Sole Arbitral Tribunal. 11. In the arbitration Clause 8, the venue for arbitration has not been fixed and further, counsel for both the parties have agreed that the arbitration proceedings may take place and be finalised at Jaipur. 12. In view of the above, I deem it proper to appoint the Sole Arbitral Tribunal in this arbitration application. 13. Accordingly, the arbitration application is allowed and Mr.Justice Yad Ram Meena, Former Chief Justice of Gujarat High Court and Former Judge of this Court is appointed as the Sole Arbitral Tribunal and the matter is referred to him for resolving the dispute between the parties arising out of the aforesaid five agreements executed between the parties. The Sole Arbitral Tribunal will fix his fee according to the Arbitration Manual. All objections would be open to be raised by the Non-applicants before the Arbitrator. 14. A copy of this order be sent to Mr.Justice Yad Ram Meena, Former Chief Justice of Gujarat High Court and Former Judge of this Court, residing at 20/45, Ambedkar Marg, Mansarovar, Jaipur 302 020.Application Allowed. *******