This application has been moved seeking intervention for constitution of the Arbitral Tribunal and for referring the disputes that have cropped up between the parties for resolution to the said Arbitral Tribunal.

The applicant Company is engaged in implementing a 330 MW Hydro Electric Power Project located on the river Alaknanda, at a distance of about 110 kilometers from Rishikesh Rail Head, along with Rishikesh - Badrinath National Highway No.58. The Project aims to utilize a head of around 66m for power generation. The profile of the Project has been described in the bid document in the following manner:

" 330 MW Shrinagar Hydro Electric Project consists of a main Dam with Diversion Tunnel on the left flank of the river Alaknanda and Intake Tunnels on right flank connected to the 2 nos. Head Race Tunnels leading to the Supana Aqueduct discharging into Desilting Basin. The Power Channel takes off from the desilting basin which discharges into the Fore bay which has a provision of Surplus arrangement. The Fore bay is duly connected to the Penstocks leading into the Power House and water gets released into the river through Tail Race Channel with Switch Yard at an elevated place on the right flank of the power house."

Accordingly, Bids have been invited for construction of Diversion Tunnel on the left flank of the river. The respondent submitted its bid and after a series of negotiations, through a communicated dated 26-04-2006, it has agreed to construct the Diversion Tunnel for Rs.7.75 crores. Thus an agreement has been entered into by and between the parties under the terms of which, the work has to be executed by 15-12-2006. It is the assertion of the applicant that the respondent did not complete the work by 15-12-2006, but sought for extension of time and time was granted up to 15-04-2007. It was further submitted that when the respondent has sought for further time up to 15-12-2007, the applicant realized the inability of the respondent to complete the Project and in view of the serious implications of the over run due to delay in execution of construction of Diversion Tunnel, which will have an adverse affect on the other works of the Project, as well as the Project costs, the Applicant has terminated the agreement on 08-05-2007. It is further asserted that conciliation meetings were undertaken by top Executives of the Applicant Company at which, the Director-in-charge of the Project and the Chairman and Managing Director of the respondent Company have participated and that as a goodwill measure, certain important decisions were taken thereat to hold back immediate invocation of the bank guarantee furnished by the respondent and also to permit the officials of the respondent Company to take full and complete measurements of the works executed till then. However, it is pointed out that the respondent has improperly converted the period of conciliation to his advantage by rushing to the local civil court and instituted proceedings for restraining the applicant Company from encashing the bank guarantee as well as proceeding further with the execution of the Project work. Therefore, the applicant has put the respondent on notice on 04-06-2007 invoking Clause-3.31 of the General Terms and Conditions of the contract for securing resolution of the disputes by way of reference to arbitration proceedings. The applicant has laid a claim for little more than Rs.373 crores against the respondent. It has also nominated a former Chief Justice of the Chattisgarh High Court as its nominee Arbitrator and called upon the respondent to nominate an Arbitrator on its behalf. In response to this notice, the respondent through its reply dated 19-06-2007 resisted the attempt of the applicant on the ground that subclauses i & ii of Clause

3.3.1 of the contract, have not been complied with by undertaking resolution of the disputes through conciliation and hence, disputed the right of the parties to nominate Arbitrators for constitutin