High Court Of Delhi
JAI KRISHAN PARUTHI - Appellant
Versus
D.S.PUNIA - Respondent
Civil Miscellaneous (Main) 147 of 1993
Decided On : 07/13/1993
ARBITRATION - APPOINTMENT OF ARBITRATOR - EXHAUSTION OF ARBITRATION AGREEMENT - LIMITATION - INTERPRETATION OF CLAUSE 21 (A) OF THE CONTRACT - ARBITRATION ACT, 1940, SECTION 21 (A).
Fact of the Case:
Jai Krishan Pruthi entered into an agreement with the Union of India for the supply of meat and eggs. A dispute arose during the period of supply, and an arbitrator was appointed to adjudicate the dispute. The arbitrator made an award in favor of the Union of India, which was set aside by the court. The Union of India appointed another arbitrator to adjudicate the dispute, and Jai Krishan Pruthi filed an application under Section 33 and Section 5 of the Arbitration Act, 1940, challenging the appointment of the arbitrator.
Finding of the Court:
The court held that the arbitration agreement had not been exhausted and that the appointment of the arbitrator was proper. The court also held that the question of limitation was to be decided by the arbitrator and not by the court.
Issues: 1. Whether the arbitration agreement between the parties had been exhausted or ceased to exist. 2. Whether the appointment of the arbitrator was proper. 3. Whether the court had territorial jurisdiction to try the petition.
Ratio Decidendi: 1. The court held that the arbitration agreement had not been exhausted because the Union of India had not been able to get its claim adjudicated upon by the arbitrator. 2. The court held that the appointment of the arbitrator was proper because the Union of India was entitled to have its claim adjudicated upon by an arbitrator. 3. The court held that it had territorial jurisdiction to try the petition because the arbitration agreement was entered into in Delhi.
Final Decision: The court dismissed the petition.
( 1 ) THIS order will dispose of Civil Misc. (Main) 147/93, Jai Krishan Pruthi v. D. S. Puma and others as also Civil Miss. (Main) 151/93 Jai Krishan Pruthi v. D. S. Puma, since they arise out of the same judgment dated 12th March, 1993 of Shri Dilbagh Singh Punia, Sub Judge, Delhi and thus, can be disposed of together.
( 2 ) THE learned Sub Judge has, vide impugned judgment, dismissed applications under Section 33 and Section 5 of the Indian Arbitration Act read with Section 151 Civil Procedure Code as maintainable and holding that the Union of India was competent to appoint an arbitrator and the arbitration agreement was very much in existence.
( 3 ) BRIEFLY stated, the facts leading to the filing of these petitions are that Jai Krishan Pruthi entered into an agreement for the supply of "meat dressed including edible offals" and "eggs" during the period 1973-74. After the settlement was arrived at, an agreement was reduced into writing, in which. Clause 21 (A) was added, making provisions for making reference to the arbitration in respect of the disputes, which may arise between the parties. The dispute arose during the period of making the supply and so, a petition under Section 20 along with an application under Section 41 of the Arbitration Act (hereinafter referred to as "the Act") was filed in the court. The Union of India filed reply giving information with regard to the appointment of arbitrator to adjudicate the disputes on account of which the application field under Section 20 of the Act was disposed of as having become infructuous while interim relief was granted while disposing of the application under Section 41 of the Act. Brig. C. A. Quinn appointed as arbitrator by Quarter Master General, Army Headquarter, New Delhi made an award in favour of the Union of India, which was ultimately set aside by the court of Shri J. K. Pali, holding that the arbitrator had gone beyond the scope of reference.
( 4 ) QUARTER Master General, thereafter appointed Brig. A. S. Sumra as an arbitrator under Clause 21 (C) of the contract vide letter dated 8th April, 1987, in which the arbitrator was also required to adjudicate as to whether the claim of the Union of India was barred by limitation and if not to consider the same. Application under Section 28 of the Act was moved by the Union of India in the court of Shri Om Prakash, Sub Judge 1st Class, Delhi for extension of time for making of the award. However, in those proceedings, an application under Section 33 of the Act red with Section 151 Civil Procedure Code was moved by Jai Krishan Pruthi with a prayer that the arbitrator may be changed and a prayer was made to determine the scope reference of the dispute pending before the arbitrator. While extending the time, a direction was issued by the learned Sub Judge that the arbitrator was to decide only the claim of the contractor and that another arbitrator may be appointed by the competent authority. Accordingly, Brig. (Retd.) S. P. Talwar was appointed as the sole arbitrator to adjudicate the claim of the " petitioner/contractor. Award dated 16. 2. 1991 was made by Brig. S. P. Talwar regarding which, separate proceedings for making the said award rule of the court are pending in the court.
( 5 ) ON the application of the Union of India, Quarter Master General, Army, Headquarter, New Delhi made an order dated 16. 3. 1990 to the effect that under the provisions of Clause 21 (A) of the agreement. Brig. Shively Bal Gopal was appointed as arbitrator to adjudicate the claims of Union of India only arising out of the disputes in the contract for the supply of Meat dressed including edible offals and eggs fresh at Bombay during the period 1973-74 operated by Shri Jai Krishan Pruthi. In pursuance of this order regarding the appointment of Brig. B. G. Shively as arbitrator, the Union of India filed claim against the petitioner. Reply of the said claim was not filed by the petitioner, who has moved an application under Section
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