This application is filed, under Section 11(6) of the Arbitration and Conciliation Act, 1996, seeking appointment of a retired Judge of the Andhra Pradesh High Court, or a technically qualified impartial and independent person, as a substitute arbitrator.

2. The applicant is a private limited company with its registered office at Chennai. The respondent, a private limited company with its registered office at Calcutta, was awarded the work of rehabilitation and upgradation of the existing two lane road to a 4/6 lane divided carriage way between Kavali and Ongole in the State of Andhra Pradesh, (i.e., Chainage KM 222 to KM 291), by the National Highway Authority of India. The respondent engaged the applicant as its sub-contractor for execution of about 50% of the said road work. Clause 21 of the work order, which is the arbitration clause, provided that, in the event of any difference or dispute arising out of, or in connection with, the work order, the same shall first be amicably settled by mutual dialogue and, if the parties fail to settle their differences or disputes arising out of or in connection with the work order, the same shall be referred to arbitration to be conducted by a single arbitrator appointed by the Managing Director of the respondent company. The arbitration clause also provided that the venue of the arbitration shall be at Calcutta.

3. Disputes arose between the applicant and the respondent during the course of execution of the work with respect to measurements and payments. The applicant filed O.S.No.72 of 2002 before the Court of the Senior Civil Judge, Kandukur in Prakasam District wherein they also sought for an ad-interim injunction restraining the respondent from entrusting the work to third parties to their detriment. The Senior Civil Judge granted ad-interim injunction in I.A.No.1391 of 2002. Thereafter, the respondent invoked Section 8 of the Arbitration and Conciliation Act, 1996 and moved I.A.No.1503 of 2002 requesting the Court to refer both the parties to arbitration. The said application was allowed and the parties were directed to settle their disputes before the arbitrator.

4. One of the Directors of the respondent - company addressed a letter dated 14.10.2002, to the Managing Director of the respondent company, requesting him to appoint an arbitrator in accordance with Clause 21 of the agreement and the Managing Director, vide letter dated 18.10.2002, appointed Sri P.R.Dhar, one of the directors of the respondent company, as the arbitrator. The applicant challenged the arbitrator under Sections 12 and 13 of the Act. Sri P.R.Dhar rejected the challenge, vide proceedings dated 1.10.2003, holding that he was an independent and non-executive director of the company and that there were no justifiable grounds to doubt his independence and impartiality. The respondent filed their claim statement, the applicant filed their counter, followed by the rejoinder of the respondent to the counter -claim filed by the applicant and, thereafter, the reply of the applicant to the rejoinder. The applicant received letter dated 25.8.2004 from the arbitrator on 6.9.2004 informing them that, because of his ill-health, he was resigning as an arbitrator.

5. The applicant filed A.A.No.50 of 2004 before this Court, under Section 11(5) read with Section 15(2) of the Act, requesting that a substitute arbitrator be appointed to resolve their disputes. The Chief Justice, in his order in A.A.No.50 of 2004 dated 4.3.2005, taking note of the assertion of the respondent that, after the resignation of the earlier arbitrator, the Managing Director, by order dated 8.9.2004, had appointed Sri S.K.Biswas as the sole arbitrator in accordance with Clause 21 of the agreement, observed that, since the arbitrator had already been appointed by the time the application was filed, the said appointment was in consonance