Point of Law: There is a specific provision under Clause 47 of the Arbitration Agreement which provides for arbitration in respect of claim of an amount which is less than 20% of the value of the Contract and in respect of any claim which is above 20% of the claim, the arbitration will not be applicable.

JUDGMENT :

1. Heard Mr. D. Senapati, learned counsel for the petitioner. Also heard Mr. S. Chakraborty, learned Standing Counsel, Railway for the respondents.

2. The present petition has been filed under Section 11(6) of the Arbitration and Conciliation Act, 1996 for appointment of an Arbitrator on the alleged failure of the respondent authorities to appoint the Arbitrator in terms of the Agreement dated 11.02.2016 entered between the parties. Clause 63 and 64 of General Conditions of the aforesaid Contract Agreement provide for appointment of an Arbitrator to settle disputes.

3. Mr. Senapati, learned counsel for the petitioner submits that after the failure of the Railway authorities to clear certain bill amounting to Rs.2,42,12,770.64, which according to the petitioner, the Railway authorities are liable to pay to the petitioner, the petitioner sent a notice on 14.01.2020 under Section 21 of the Arbitration and Conciliation Act, 1996 read with Clause 64.(1)(i) of the General Conditions of the Contract for appointment of arbitrator/arbitrator(s) to adjudicate the dispute relating to the Contract Agreement bearing No. CON/NMX-JPZ/2166 dated 11.02.2016. However, the respondent railway authorities failed to respond to the said notice dated 14.01.2020 compelling the petitioner to approach this Court for appointment of an Arbitrator under Section 11 of the Arbitration and Conciliation Act, 1996.

4. The Railway authorities have filed their affidavit objecting to this claim on the ground that as the amount claimed is beyond 20% of contract amount, the same is not liable for arbitration as provided under Clause 47 of the General Conditions of the Contract.

Clause 47 of the General Conditions of the Contract reads as follows,

“47. The provision of Clauses 63 and 64 to the General Conditions of Contract will be applicable only for settlement of claims or disputes between the parties for values less than or equal to 20% of the value of the contract and when claims of disputes are of value more than 20% of the value of the contract, provisions of Clauses-63 & 64 and other relevant clauses of the General Conditions of Contract will not be applicable and arbitration will not be a remedy for settlement of such disputes.”

5. It has been accordingly submitted by Mr. S. Chakrabotry, learned Standing Counsel, Railways that as the aforesaid amount claimed in the notice dated 14.01.2020 is above 20% of the contract amount, no arbitration would lie and as such, the appointment of the arbitration does not arise in the present case.

6. In response, Mr. Senapati, learned counsel for the petitioner submits that when the petitioner submitted the notice on 14.01.2020 seeking for appointment of an Arbitrator, the respondent authorities did not raise any such objection. In fact, they did not respond to the same and as such, in terms of Section 4 of the Arbitration and Conciliation Act, 1996, it may be deemed that the respondent authorities have waived their right to object to the same, in which event, they were under the obligation to appoint an Arbitrator.

7. It has been further submitted by Mr. Senapati, learned counsel for the petitioner that Section 21 of the Arbitration and Conciliation Act, 1996 clearly provides that unless otherwise agreed by the parties, the arbitral proceedings in respect of a particular dispute commence on the date on which a request for that dispute to be referred to arbitration is received by the respondent. Accordingly, it has been submitted that since the respondent authorities have not responded to the notice dated 14.01.2020 for appointment of the Arbitrator which was received by them, it will be deemed that they have waived any such right to object and as such, the Court can proceed to appoint an Arbitrator.

8. Mr. Senapati, learned counsel for the petitioner further submits that assuming that the aforesaid amount is barred for arbitration as provided under Clause 47 of the General Conditions of the Contract Agreement referred to