IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR
PUSHPENDRA SINGH BHATI, J.
Aseem Watts S/o. Sher Singh - Petitioner
Versus
Union of India, Chief Engineer, Hq (P), Chetak, Rajasthan & Ors. - Respondents
S.B. Arbitration Application No. 14 of 2021 Connected With S.B. Arbitration Application Nos. 4, 5, 19, 20, 21 of 2021, 31 of 2022
Decided On : 02-09-2023
Arbitration and Conciliation Act, 1996 - Section 11 , 14 & 15 - Arbitration application - Delays and defaults in performance of the works - Appointment of arbitrator by mutual consent – Held, It is clear that seat of arbitration was mentioned as Bikaner and Bikaner Court shall have exclusive jurisdiction in matter, and venue of arbitration was mentioned as New Delhi (HQ of BRO) - It comes under jurisdiction as well as supervision of this Hon’ble Court - Court observes that applicant is seeking substitution of arbitrator so appointed earlier, by an independent arbitrator to resolve dispute between the parties - Court further observes that arbitrator was appointed and matter is still pending, and thus, it is necessary to appoint an independent arbitrator, afresh, in present case - Court is of opinion that agreement clause, relating to appointment of Arbitrator, is required to be invoked - Instant applications are allowed
JUDGMENT :
1. The instant arbitration application nos. 14/2021, 15/2021, 19/2021, 20/2021, 21/2021 and 31/2022 have been filed by the applicant-Firm under Section 11 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as ‘Act of 1996’) and for the purpose of deciding the said applications, the factual matrix and prayer clauses are being taken from application no. 14/2021, while treating the same as a lead case. The prayer clauses read as under:-
(i) An arbitrator may kindly be appointed to resolve the dispute between the parties in terms of condition 35 of the agreement between the parties;
(ii) Cost of this application may kindly be awarded in favour of the applicant.
(iii) Any other appropriate relief which this Hon’ble Court may deem fit in the facts and circumstances of the case may kindly be awarded in favour of the applicant.”
2. The instant arbitration application nos. 04/2021, 05/2021 have been filed by the applicant-Firm under Sections 14 & 15 of the Act of 1996, and for the purpose of deciding the said applications, the factual matrix and prayer clauses are being taken from the applications no.4/2021, while treating the same as a lead case. The prayer clauses read as under :
(i) The Hon’ble Court may kindly be pleased to Appoint/Substitute an independent and impartial Arbitrator to adjudicate the differences and disputes between the Applicant and the Respondent.;
(ii) Cost of this application may kindly be awarded in favour of the applicant.
(iii) Any other appropriate relief which this Hon’ble Court may deem fit in the facts and circumstances of the case may kindly be awarded in favour of the applicant.”
3. As per the facts pleaded in Arbitration Application No. 14/2021, on 04.07.2015, the respondent invited a tender for Providing and Laying of Re-Surfacing With (HMP Mix) MSS Type “B” 2.0 Cm Thick Consolidated with Bitumen VG-30 etc. The applicant submitted its bid and the same was accepted; after finalization of the tender process, the work order was issued in favour of the applicant-Firm on 22.09.2015.
3.1. Thereafter, certain dispute arose between the applicant and respondent regarding delays and defaults in performance of the works in question. The applicant sent a legal notice dated 27.11.2020 for appointment of arbitrator by mutual consent for resolving the dispute between the parties. The respondent via e-mail dated 26.12.2020 informed the applicant that the arbitrator was appointed as per the clause 24 of the Agreement in question. The applicant in its letter dated 05.01.2021 addressed to the respondent, stated that the present dispute is not covered under clause 24, instead the same was covered under clause 35.2 of the agreement in question.
Relevant Clauses of the agreement in question are reproduced hereunder:-
In the event of any dispute or difference between the parties hereto, such dispute or differences shall be resolved amicably by mutual consultation or through the good offices of empowered agencies of the Government. In the even of any such dispute or differences relating to the interpretation and application of the provisions of contracts where such resolution is not possible then the un-resolved dispute or differences shall be referred by either party to the Arbitration of one of the Arbitrators in the department of Public Enterprises to be nominated by the Secretary to the Government of India in-charge of the Bureau of Public Enterprises and in such case the Arbitration and Conciliation Act shall not be applicable to the arbitration under this clause. The award of the Arbitrator shall be bindings upon both the parties to the dispute. Provided, however, any party, aggrieved by such award, may make a further reference for se
Brahmani River Pellets Ltd. Vs. Kamachi Industries Ltd.
The jurisdiction for appointing an arbitrator lies with the court where the principal agreement was executed, as per Section 11(6), despite a venue specified in an ancillary agreement.
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Point of law : Seat of Arbitration - What constitutes the ‘seat’ of arbitral proceedings - the intention of the parties is germane and that can be gathered from Contract.
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