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2020 Supreme(Del) 264

IN THE HIGH COURT OF DELHI AT NEW DELHI
JYOTI SINGH, J.
Active Media - Petitioner
Versus
Divisional Commercial Manager, Northern Railway - Respondent
ARB.P. 694 of 2019
Decided On : 04-03-2020

Advocate Appeared:
For the Petitioner:Mr. Rishabh Jetley, Advocate.
For the Respondent:Mr. Amitaya Poddar and Ms. Reshma Gehlot, Advocates.

The main legal point established in the judgment is that the validity of the notice invoking Arbitration is crucial for the maintainability of a petition under Section 11(6) of the Arbitration and Conciliation Act, 1996.

Headnote:

Arbitration - Agreement Dispute - Arbitration and Conciliation Act, 1996, Section 11(6) - Relevant Acts and Sections: Arbitration and Conciliation Act, 1996, Section 11, Section 12, Section 21, Section 34, Section 43 - The court found that the petitioner failed to send a notice invoking Arbitration at the correct address, resulting in the absence of an invocation notice to the respondent. The petition was dismissed on the ground of there being no notice of invocation of Arbitration to the respondent.

Fact of the Case:

Disputes arose between the parties regarding an Agreement for provision of onboard TV and Information Dissemination and Entertainment System. The petitioner invoked the Arbitration Clause mentioned in the Agreement and sought appointment of the Arbitrator through a notice. The respondent neither replied to the notice nor took any steps for constitution of the Arbitral Tribunal.

Finding of the Court:

The court found that the petitioner failed to send a notice invoking Arbitration at the correct address, resulting in the absence of an invocation notice to the respondent. As a result, the petition was dismissed.

Issues: The issues involved the validity of the notice invoking Arbitration and the maintainability of the petition under Section 11(6) of the Act.

Ratio Decidendi: The court held that the petitioner's failure to send a notice invoking Arbitration at the correct address rendered the petition not maintainable.

Final Decision: The petition was dismissed on the ground of there being no notice of invocation of Arbitration to the respondent.

JUDGMENT :

JYOTI SINGH, J.

1. This is a petition under Section 11(6) of the Arbitration and Conciliation Act, 1996, (‘Act’).

2. An Agreement dated 13.09.2014, was entered between the parties for provision of onboard TV and Information Dissemination and Entertainment System in all executive class and chair car coaches of the Delhi Kalka New Delhi Shatabdi Express.

3. Certain disputes arose between the parties and the petitioner invoked the Arbitration Clause mentioned in the Agreement and sought appointment of the Arbitrator through a notice dated 22.01.2019. The petitioner also communicated that it had not waived the applicability of Section 12(5) of the Act.

4. Respondent neither replied to the notice nor took any steps for constitution of the Arbitral Tribunal. Relevant part of the Arbitration Clause between the parties reads as under:-

    “(i) In the event of any dispute or difference between the parties hereto as to the construction or operation of this contract, or the respective rights and liabilities of the parties on any matter in question, dispute or difference on any account or as, to the withholding by the Railway of any certificate to which the contractor may claim to be entitled to or if the Railway fails to make a decision within 120 days, then and in any such, but except in any of the excepted matters" referred to in Clause 63 of these conditions, the contractor after 120 days but within 180 days of his presenting his final claim on disputed matters shall demand in writing that the dispute or difference be referred to arbitration.”

5. Learned counsel for the respondent had sought time to take instructions in the matter. Learned counsel submits that he is not filing a reply to the petition but has two preliminary objections to the maintainability of the present petition. He submits that the first objection is that no notice of invocation of Arbitration was sent by the petitioner to the respondent and secondly it was the petitioner who had abandoned the contract and cannot take advantage of its own wrong by seeking to invoke the Arbitration Clause.

6. Learned counsel for the petitioner, per contra, argues that there is no merit in the objections raised by the respondent. Attention of the Court is drawn to the notice of invocation sent to the respondent on 22.01.2019 which has been filed along with the petition. Responding to the second objection, learned counsel for the petitioner submits that it is wrong to contend that it was the petitioner who had abandoned the contract and in any case, as per the settled law, it is not open for this Court to enter into the merits of the disputes at the stage of examining the petition under Section 11(6) of the Act.

7. Learned counsel for the respondent responding to the arguments of the petitioner vehemently contends that it is not correct for the petitioner to argue that the notice of invocation was sent to the respondent. He submits that a perusal of the notice dated 22.01.2019 would show that the notice was addressed to Divisional Commercial Manager, Northern Railway and the address was NDCR Building, State Entry Road, New Delhi. He submits that the correct address should have been DRM Office and not NDCR Building and hence no notice was received by the respondent herein. In response to the petitioner’s argument on the second objection raised by the respondent, learned counsel submits that under Section 11(6) of the Act the Court is required to adjudicate as to which party is guilty of breach of contract before referring the matter to Arbitration.

8. I have heard the learned counsels for the parties and examined their contentions.

9. I find merit in the contention of learned counsel for the respondent that the notice invoking Arbitration was sent to the office of Divisional Commercial Manager, Northern Railway but at a wrong address i.e. NDCR Building, State Entry Road. A perusal of several other documents filed by the petitioner clearly indicates that the petitioner has corresponded wi

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