2023 Supreme(J&K) 284
IN THE HIGH COURT OF JAMMU AND KASHMIR AND LADAKH AT JAMMU
Tashi Rabstan, J.
M/s. R.K. Gupta and Co. – Petitioner
Versus
University of Jammu and others – Respondent
ARB P No.51 of 2019
Decided On : 23-02-2023
Advocate Appeared:
For the Petitioner:Mr. R.K. Jain, Sr. Advocate with Mr. Gowhar Amin, Advocate
For the Respondent:Mr. Ajay Abrol, Advocate
Headnote:
J&K Arbitration and Conciliation Act, 1997 – Section 11(6), 12(5) – Direction for reference of dispute – Appointment of an Arbitrator – Held, Court are of view that appointment of Principal Secretary, Government of Haryana as nominee arbitrator of HARSAC which is a Nodal Agency of Government of Haryana, would be invalid under Section 12(5) of Arbitration and Conciliation Act, 1996 read with Seventh Schedule – Section 12(5) of Arbitration Act, 1996 provides that notwithstanding any prior agreement to contrary, any person whose relationship with parties, or counsel, falls within any of categories specified in Seventh Schedule, shall be ineligible to be appointed as an arbitrator – Petition allowed.
JUDGMENT :
1. The petitioner has filed the instant petition under Section 11(6) of the J&K Arbitration and Conciliation Act, 1997 (hereinafter referred to as “Act”) seeking a direction for reference of dispute arising out of Agreement No. 3 having Allotment No. UWD/13-14/192-201 dated 1st May, 2013, inter se the parties to an independent Arbitrator, on the strength of averments made and grounds taken in the petition.
2. The brief facts of the case are as under :
The respondents-University of Jammu allotted a contract by way of Agreement No. 3 having Allotment No.UWD/13-14/192-201 dated 01.05.2013 to the petitioner firm, for construction of boys hostel at Poonch Campus of Jammu University, Poonch (Civil and Sanitary Work) for an amount of Rs.5,62,86,678.00/-. As per the terms and conditions of the Contract Agreement the date of commencement of work was seventh day from the date of allotment of work and the period of contract agreement and its completion was up to fifteen months. After the issuance of the contract, the petitioner firm mobilized its men and machinery to start work at site, however, the petitioner was not permitted to start work at site in view of existence of some land dispute between the department and locals of the area. Thereafter, the petitioner firm time and again made requests to the respondents for permission to start the work. The petitioner firm apprised the respondents that due to stoppage of work the petitioner company has faced huge financial loss on account of plant and machinery as well as the manpower remained idle and material dumped at the site, however, the respondents dilly dallied the matter on one pretext or the other, causing severe financial loss to the petitioner, which resulted into dispute inter se the petitioner and the respondents. Thereafter, the petitioner vide notice dated 15.07.2019 called upon the respondent No. 2 to appoint an Arbitrator in terms of Clause (26) of the General Conditions of the Contract and also submitted the list of claims, however, the respondent No. 2 failed to take steps for appointment of an Arbitrator within thirty days, which has given cause of action to the petitioner to approach this Court.
3. The respondents have filed objections contending therein that as per the terms and conditions of the agreement, the petitioner was supposed to complete the allotted work within 15 months from the date of allotment of work, however, the petitioner could not conclude the contract and left the same midway and thereafter issued a notice for reference of dispute to the named Arbitrator. It is further contended that the notice was received on 31.07.2019 and the named Arbitrator entered upon the reference on 30.08.2019 and the petitioner was informed accordingly. The Arbitrator fixed the date for appearance of the parties on 01.10.2019, on which date the Arbitrator conducted the preliminary proceedings wherein the officials of the University were present, however, none represented the petitioner and as such, proceedings were adjourned. It is further contended that the petition is misconceived and misdirected as the same has been filed after the Arbitrator entered upon the reference and conducted proceedings.
4. Heard learned counsel appearing for the parties and considered their submissions.
5. The precise and only argument put forth by Mr. Ajay Abrol, learned counsel for the respondents is that the present petition has been filed by the petitioner after the Arbitrator entered upon the reference and conducted proceedings on 01.10.2019 and the petitioner instead of appearing before the learned Arbitrator on 01.10.2019 has filed this petition, therefore, the present petition under Section 11(6) of the J&K Arbitration and Conciliation Act, 1997 is not maintainable.
6. Learned counsel for the petitioner has vehemently argued that in view of the amendment of Section 12 of the Act, the proceedings conducted by the Arbitrator on 01.10.2019, who has entered upon the reference, is require