This application under Section 11(6) of the Arbitration and Conciliation Act, 1996, has been filed by petitioner M/s Contec Airflow (I) Private Limited praying for appointment of Arbitral Tribunal as per Section 10 and 11 of the Arbitration and Conciliation Act, 1996 for resolving the dispute between the petitioner and the respondent M/s. Rajasthan Drugs and Pharmaceuticals Limited.

2. The petitioner is a Private Limited Company registered under the Companies Act, 1956. The respondent, issued a letter of intent dated 01.11.2016 in favour of petitioner for ventilation and air conditioning work at their site. The cost of the said work was estimated to be Rs.2,55,00,000/-. Pursuant to the said letter of intent, an agreement was entered into between the parties. The respondent pursuant to the said letter of intent had agreed to issue detailed purchase order for Schedule-A item and work order for Schedule-B item specified in the Bill of Quantity of the Tender Document No.T-003. The respondent thereafter issued purchase order no.998 dated 14.12.2006-23.12.2006 in favour of the petitioner thereby giving the details of the purchase order and also issued work order for the work/erection and commissioning work to be done for the said ventilation and air condition system. The petitioner deposited a sum of Rs.12,00,000/- (Rs.3,00,000/- +Rs.3,50,000/-+Rs.5,50,000/-) as earnest money for execution of the said project.

3. Mr. P.C. Dewanda, learned counsel for the petitioner argued that the petitioner supplied the goods as per the purchase orders of the respondent and also carried out the work as per the work order and accordingly issued invoices to the respondent. The respondent, on several occasions, called upon the petitioner to do some additional and alternations in the work done by the petitioner and the petitioner accordingly complied with all the requirements. The petitioner requested orally as well as in writing several times to the respondent for releasing the payment for the goods supplied as per the purchase order and for the work done as per the work order, but the respondent failed and neglected to make payment. The officers of the respondent time and again assured the petitioner that the payment shall be released but so far nothing has been done. In this regard, minutes of the meeting dated 18.12.2012 is placed on the record as to the quantum of the work done. A total sum of Rs.1,00,75,558/- (Rs.92,25,558/- +Rs.12,00,000/-) was due and payable by the respondent to the petitioner.

4. Mr. P.C. Dewanda, learned counsel for petitioner, has referred to Clause 28 of the Agreement between the parties and argued that the aforesaid clause, which is captioned “SETTLEMENT OF DISPUTE (ARBITRATION)” provides for resolution of the disputes between the parties through arbitration. This is an arbitration clause and that the reference ought to be made to Arbitrator/Arbitral Tribunal after making its appointment. Despite existence of dispute and invocation of arbitration clause by the petitioner, the respondent has failed to appoint the arbitrator in accordance with agreed procedure. It has therefore forfeited the right to do so. Learned counsel, in support of his arguments, has relied on the judgments of the Supreme Court in Powertech World Wide Limited Vs. Delvin International General Trading LLC, (2012) 1 SCC 361, Visa International Limited Vs. Continental Resources (USA) Limited, (2009) 2 SCC 55, Mallikarjun Vs. Gulabarga University, (2004) 1 SCC 372, M/s. Duro Felguera, S.A. Vs. M/s. Gangavaram Port Limited, Arbitration Petition No.30/2016 decided vide judgment dated 10.10.2017, and that of a Division Bench of this Court in M/s. Suri Constructions Vs. State of Rajasthan & Others, 2005 (4) WLC (Raj.) 563.

5. Mr. N.L. Agrawal, learned counsel for the respondent, opposed the application and argued that as per Section 21 and 43 of the Arbitration and Conciliation Act, 1996, the legal notice for referring the dispute as per the arbitration