CHHATTISGARH HIGH COURT
Rajendra Chandra Singh Samant, J.
MEHROTRA BUILDICON (P) LTD - APPELLANT
Versus
DEPUTY CHIEF ENGINEER (CON ), SOUTH EAST CENTRAL RAILWAY, RAIPUR - RESPONDENT
Arbitration Request No. 34 of 2018
Decided On : 26-06-2019
Arbitration and Conciliation Act, 1996 - Sections 11 (6) read with Section 15 (2), 14 and 12 (5) - Agreement - Drawing and due to price variations - Execution of the work - Respondents floated an advertisement inviting tender - Applicant was successful bidder, who was awarded work by letter of acceptance by respondents - Agreement was entered between both parties and construction was to be completed within 18 months as per terms of the contract - Due to failure on part of respondents in providing applicant with drawing and due to price variations - Execution of work was delayed, however, work was completed - Outstanding payment was not cleared by respondents despite various request and reminders sent by applicant - Applicant then sent a notice requesting respondents to refer dispute to Arbitral Tribunal in accordance with the terms and conditions of contract - Respondents constituted Arbitral Tribunal consisting of three members, who were the officers of railway consequent to notice given – Held, Conclusion is arrived at, that it is fit case for exercise of power under Section 11(6) of Act, 1996 - Therefore, by exercising power under Section 11 (6) of Act, 1996 under authority given by Honble – Court hereby appoint former Judge of this High Court to arbitrate dispute between parties - Registry is directed to communicate order shall enter into reference after complying with provisions contained in Section 12 (2) of the Act, 1996 - Learned arbitrator is requested to dispose off matter within the time prescribed - Petition is disposed off
JUDGMENT
Rajendra Chandra Singh Samant, J. - This application under Section 11 (6) read with Section 15 (2) of the Arbitration and Conciliation Act, 1996 (in short 'the Act, 1996') has been brought with prayer to appoint a sole arbitrator to arbitrate the dispute between the parties. Page No.2
2. The applicant is a construction company. Respondents floated an advertisement inviting tender on 17.10.2006. The applicant was successful bidder, who was awarded work by letter of acceptance dated 02.04.2007 by the respondents. An agreement was entered between both the parties and the construction was to be completed within 18 months as per the terms of the contract. Due to failure on the part of the respondents in providing the applicant with drawing and due to price variations, the execution of the work was delayed, however, the work was completed on 25.12.2010. Outstanding payment was not cleared by the respondents despite various request and reminders sent by the applicant. The applicant then sent a notice dated 12.01.2012 requesting the respondents to refer the dispute to Arbitral Tribunal in accordance with the terms and the conditions of contract dated 17.08.2007. The respondents constituted Arbitral Tribunal consisting of three members, who were the officers of railway consequent to the notice given. The applicant submitted his claims before the Arbitral Tribunal on 10.12.2012. Subsequent to that change was made in the appointment of arbitrators without the consent of the applicant in a unilateral manner on more than one occasion. It is submitted that on account of such changes, the dispute between the parties could not be adjudicated by the Arbitral Tribunal and was kept pending for almost six years. The applicant then filed a petition under Section 14 of the Act of 1996 before the Commercial Court, Naya Raipur, praying for termination of the mandate given to the Arbitral Tribunal. The learned Commercial Court has vide order dated 17.09.2018 allowed the petition and terminated the mandate of the Arbitral Tribunal, therefore, under these circumstances, the applicant prays for appointment of sole arbitrator.
3. Reliance has been placed on the judgment of Delhi High Court in case of Orissa Concrete and Allied Industries Ltd. Vs. Union of India,2016 SCCOnLine(Del) 3463 . Placing reliance on the judgment of Hon'ble Suprme Court in case of Union of India Vs. Singh Builders Syndicate, (2009) 4 SCC 523 it is submitted that Hon'ble Supreme Court has deprecated the constitution of Arbitral Tribunal by appointing serving officers posted at far away places and it has also been observed that delay and frequent change in Arbitral Tribunal make a mockery of the process of arbitration. It was further held that appointment of retired judge of Delhi High Court as sole arbitrator was proper. It was also observed in the same judgment that where the Arbitral Tribunal appointed has not functioned then it becomes necessary to make fresh appointment, the Chief Justice or designated is not powerless to make appropriate alternative arrangement to give effect to the provision of arbitration.
4. Similarly reliance has been placed on the judgment of Supreme Court in case of North Eastern Railway and Others Vs. Tripple Engineering Works, (2014) 9 SCC 288 Applied Communication and Controls Vs. Union of India & Anr.,2018 SCCOnLine(Del) 9039 M/s. G.M. Malhotra represented by G.S. Malhotra Vs. Union of India & Anr.,2017 SCCOnLine(Jhar) 3650 Gammon Encee Consortium JV Vs. Rites Limited,2015 SCCOnLine(Cal) 1777 Ratna Infrstructure Projects Pvt. Ltd. Vs. Meja Urja Nigam Private Limited,2017 SCCOnLine(Del) 7808 M/s. Padmini Chandran Menon Vs. Vijay Chandran Menon & Ors., (2018) 2 ArbLR 24 Pallav Vimalbhai Shah and Ors. Vs. Kalpesh Sumatibhai Shah & Ors., Pet. Under Arbitration Act No.15 of 2017 decided on 04.08.2017, Thyssen Stahlunion GMBH Vs. Steel Authority of India Ltd., (1999) 9 SCC 334
5. Written reply has been submitted by the respondents submitting that th
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