Failure to file a statement of defense within the statutory period under the Arbitration Act results in forfeiture of that right, emphasizing the necessity for timely compliance in arbitral proceedings.

JUDGMENT :

Jasgurpreet Singh Puri, J.

The present is a Civil Revision Petition filed under Article 227 of the Constitution of India seeking quashing of the order dated 09.04.2025 (Annexure P-11) passed by learned Sole Arbitrator whereby the right to file the statement of defence as well as the counter claim of the petitioner has been struck off by invoking the provisions of Section 25 (b) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as 'the Arbitration Act'). Further prayer has been made for setting aside of the impugned order dated 12.08.2025 (Annexure P-18) passed by learned Sole Arbitrator whereby the application filed by the petitioner for recalling of the aforesaid order dated 09.04.2025 has been rejected.

Factual Matrix

2. Brief facts of the present case are that there was an Agreement between petitioner No.1 i.e. Jalandhar Improvement Trust and the respondent-Contractor pertaining to construction of towers and thereafter, a dispute arose between the parties. Since there was a valid arbitration clause in the aforesaid Agreement and the mechanism for appointment of an Arbitrator had failed, the respondent-Contractor filed an application before this Court for appointment of an Arbitrator under the provisions of Section 11 (6) of the Arbitration Act which was allowed by a Co-ordinate Bench of this Court vide order dated 30.08.2024 (Annexure P-3) and a former Judge of this Court was appointed as a Sole Arbitrator by way of the aforesaid order.

3. Learned Sole Arbitrator initiated the proceedings vide Annexure P-4 on 27.09.2024 and on that date, it was directed that the Power of Attorneys on behalf of the parties be filed by the next date of hearing and the counsel for the claimant (who is the respondent in the present petition) appeared and one Inderpal Singh, Trust Engineer along with Mandeep, Assistant, Trust Engineer also appeared and stated before the learned Arbitrator that Executive Officer of Trust will represent all the respondents in the matter. In the aforesaid first sitting of the learned Arbitrator, the procedure to be followed during the course of arbitration proceedings was also recorded in consultation with both the parties and in this way, a procedure was formulated which is also attached vide Annexure-I of Annexure P-4 in the present petition. The aforesaid order (Annexure P-4) is reproduced as under:-

'Annexure P-4

BEFORE THE ARBITRAL TRIBUNAL COMPRISING OF SOLE ARBITRATOR MR. JUSTICE RAJIV SHARMA (RETD.)

Arbitration Case No. 269 of 2020

In the matter of Arbitration:

BETWEEN

Shourya Towers Pvt. Ltd. Registered Office at B-111. Sector 5, Noida, UP through its authorized representative Sh. Mohit Garg. ..Claimant

AND

1. Jalandhar Improvement Trust, Jalandhar.

2. Chairman, Jalandhar Improvement Trust.

3. Punjab Local Body Government, Government of Punjab,Plot No.3, Dakshin Marg, Sector 35-A, Chandigarh

4. Director, Punjab Local Body Government, Government of Punjab, Plot No.3, Dakshin Marg, Sector 35-A, Chandigarh ...Respondents

Present: Mr. Himanshu Gupta, Advocate with Mr. Ankur Jain, Director, Shourya Towers Pvt. Ltd. for the claimant.

Mr. Inderpal Singh, Trust Engineer, Mr. Mandeep, Assistant, Trust Engineer for the respondents

Chandigarh.

Dated: 27th September, 2024

ORDER

1. Power of Attorneys on behalf of the parties be filed by the next date of hearing. Mr. Inderpal Singh, Trust Engineer submits that Executive Officer of Trust will represent all the respondents in the matter.

2. The parties in consultation with the Arbitral Tribunal have agreed to th