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2019 DIGILAW 1969 (JHR)

Ludhiana Dhanbad Roadways, A Sole Proprietorship Firm, Through Its Proprietor Ravinder Singh Mand v. Oil & Natural Gas Limited

2019-12-05

ANUBHA RAWAT CHOUDHARY

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JUDGMENT Anubha Rawat Choudhary, J. - Heard Mr. Navnit Prakash, counsel appearing on behalf of the petitioner. 2. Heard Mr. Pandey Neeraj Rai, counsel appearing on behalf of the respondent. 3. Counsel for the petitioner submits that the respondent had invited tender bearing tender no. W36AC16003 for Hiring of Heavy Vehicles (Minimum 20 MT Trailer and 9 MT Truck) on need and call basis for a period of three years for CBM Asset, Bokaro. The petitioner participated in the tender and bid of the petitioner was accepted and subsequently the agreement between the parties was executed on 25.05.2017 for the required services. Copy of the contract is contained in Annexure-1 to this petition. Learned counsel further submits that the respondent company in the month of March, 2018 issued various work orders bearing no. BKRO/CBM/LOG/HV-LDR/WO/2017 18/77, 83, 84,88, 91, 92, 94 and 95 for deployment of trucks and/or trailers for transportation of materials of Respondent company from the reporting place to the releasing point as provided in the said work orders. 4. It is the case of the petitioner that the petitioner duly deployed the required number of vehicles and lifted the entire load/materials from the concerned reporting place and released/unloaded the same at the concerned releasing point but the respondent illegally deducted an amount of Rs. 3,50,332 without giving any justification for the earlier period. Thus according to the petitioner total amount of Rs. 12,73,352.48/- without any jurisdiction. 5. In such circumstances, the petitioner issued letter dated 27.07.2018 requesting the respondent to verify the invoices afresh and pay the said deducted amount but the respondent vide its letter dated 01.10.2018 wrongly stated that the vehicles were hired on the daily basis and payment was made accordingly. 6. It is the specific case of the petitioner that the respondent has not acted as per the terms and conditions of the agreement. Accordingly, the petitioner is entitled to the aforesaid amount of Rs. 12,73,352.48 and also for an amount of Rs. 4,50,000/- on account of losses, injury and damages along with interest @ 15% compounded annually. 7. It has also been submitted that the petitioner has made several efforts to amicably settle the dispute with the respondent which continued for more than 6 months but the respondent did not agree and accordingly several efforts for amicable settlement failed. 4,50,000/- on account of losses, injury and damages along with interest @ 15% compounded annually. 7. It has also been submitted that the petitioner has made several efforts to amicably settle the dispute with the respondent which continued for more than 6 months but the respondent did not agree and accordingly several efforts for amicable settlement failed. Learned counsel submits that in the aforesaid background, the petitioner issued notice dated 25.02.2019 to the respondent company invoking the Arbitration Clause under the said contract and requested the respondent for appointment of an Arbitrator for adjudicating the disputes between the parties. Learned counsel submits that the arbitration agreement is clause 27. Learned counsel submits that the petitioner did not receive any response to the said application and thereafter the petitioner issued another notice dated 22.04.2019 but still the respondent failed to appoint Arbitrator for the adjudication of dispute. Accordingly, the present petition has been filed. 8. A counter affidavit has been filed in the present case by the opposite party annexing therewith a copy of the letter dated 06.09.2019 proposing the name of certain arbitrators. A rejoinder to the said counter affidavit has been filed by the petitioner annexing therewith a copy of the letter dated 25.09.2019 issued by the petitioner to the respondent mentioning about the pendency of the present arbitration application before this court and refused to agree for the appointment of Arbitrator as per the proposed names of the respondents. 9. Learned counsel for the petitioner submits that once the cause of action arises for filing the case under Section 11(6) of the Arbitration and Conciliation Act, 1996 and the same has been filed, there is no question of agreeing to the names proposed by the respondent. Learned counsel has referred to the order passed by this court in Arbitration Application No. 1 of 2016 (Alternative for India Development versus The State of Jharkhand and another) dated 15th July, 2016 which has followed the judgment passed by the Hon''ble Supreme Court reported in (2000) 8 SCC 151 , paragraph no. 19, wherein it has been held as under:- "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. 19, wherein it has been held as under:- "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 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. 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." (emphasis supplied) 10. After hearing counsel for the parties and considering the facts and circumstances of this case, this court finds that the petitioner has invoked the arbitration clause for referring the dispute to the Arbitrator vide notice dated 25.02.2019 and reminder to the same was also given on 22.04.2019 but the petitioner did not get any response to the same which led to filing of the present petition on 26.06.2019 under Section 11(6) of the Arbitration and Conciliation Act, 1996. This court also finds that admittedly the respondent did not respond to the request made by the petitioner for appointing an Arbitrator and the notice dated 25.02.2019 was responded to for the first time vide letter dated 06.09.2019 which has been filed at Annexure-A to the counter affidavit and proposed names of the Arbitrator to which the petitioner rightly did not agree and issued letter dated 25.09.2019. This court finds that it has been held by the Hon''ble Supreme Court in the case reported in (2008) 8 SCC 151 that in a case arising out of Section 11(6) of the aforesaid Act, if the opposite party has not made an appointment within 30 days of the demand, 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 and only then the right of the opposite party ceases. This judgment has been followed by this court in the case of Arbitration Application No. 1 of 2016 (Alternative of India Development vs. The State of Jharkhand and Another) disposed of vide order dated 15th July, 2016 by holding that once parties have moved application under Section 11(6) of the Arbitration and Conciliation Act, 1996 the respondent loses the right to appoint an Arbitrator. 11. Considering the aforesaid facts and circumstances this court finds that condition precedent for filing application under Section 11(6) of the Arbitration and Conciliation Act, 1996 has been satisfied and an Arbitrator for resolving the dispute between the parties has to be appointed by this court. 12. In such circumstances, this court now proposes to appoint Mr. Rohitashya Roy, learned Advocate, Jharkhand High Court, at present residing at Behind Hotel Apsara, Circular Road, Lalpur, Ranchi Phone No.0651-2561150, Mobile No.94311-15387, email: rohitashya.roy@gmail.com as an Arbitrator to adjudicate the dispute between the parties. 13. Accordingly for seeking consent from Rohitashya Roy, learned Advocate, Jharkhand High Court and to ascertain if he has any interest in the said matter in terms of Scheduled 5 of Arbitration and Conciliation Act, 1996 to adjudicate the dispute between the parties, learned Registrar General of this court is directed to communicate this order along with the pleadings of this case for submission of his declaration under clause 12(1) of amended provision of Arbitration and Conciliation Act, 1996 to the proposed Arbitrator seeking his declaration as aforesaid. The aforesaid may be served to the proposed Arbitrator in the court itself through his Advocate clerk. 14. Post this case on 13.12.2019 awaiting declaration.