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2021 Supreme(UK) 622

IN THE HIGH COURT OF UTTARAKHAND AT NAINITAL
Raghvendra Singh Chauhan, J.
Mahendra Singh Rana - Appellant
Versus
Cantonment Board - Respondent
Arbitration Application No. 21 of 2020
Decided On : 06-08-2021

Advocates Appeared:
Mr. Mahanand Joshi and Mr. Kanti Ram., for the Appellant; Mr. B.S. Adhikari, for the Respondent.

The court emphasized the importance of adhering to the agreed arbitration process and the necessity of an express agreement in writing to waive the bar contained in Section 12(5) of the Act.

Headnote:
Arbitration - Appointment of Sole Arbitrator - Section 11(6) of the Arbitration and Conciliation Act, 1996 - Section 12(5) of the Act
Fact of the Case:

The applicant, a contractor, undertook government contracts for supplying material/goods to the respondent, Cantonment Board. Despite completing the work orders, the applicant did not receive payments totaling Rs. 1,55,40,112.19 along with GST. The applicant sent a legal notice requesting the respondent to clear the outstanding bills and appoint the sole Arbitrator, 'the Garrison Engineer', as per the agreement. The respondent did not appoint the Arbitrator, leading the applicant to file an Arbitration Application under Section 11(6) of the Act.
Finding of the Court:

The court found that the respondent did not act on the request to appoint the sole Arbitrator within the stipulated thirty days and did not have an express agreement in writing to waive the bar contained in Section 12(5) of the Act. Therefore, the court appointed Mr. B.C. Kandpal, Retd. Judge, High Court of Uttarakhand, as the sole Arbitrator to resolve the disputes between the parties.
Issues: The issues revolved around the appointment of the sole Arbitrator as per the agreement and the waiver of the bar contained in Section 12(5) of the Act.
Ratio Decidendi: The court held that the respondent's silence and inaction in appointing the Arbitrator within the stipulated time and the absence of an express agreement in writing to waive the bar in Section 12(5) justified the court's appointment of the sole Arbitrator.
Final Decision: The court appointed Mr. B.C. Kandpal, Retd. Judge, High Court of Uttarakhand, as the sole Arbitrator to resolve the disputes between the parties.

JUDGMENT

1. The present Arbitration Application has been filed under Section 11(6) the Arbitration and Conciliation Act, 1996 ("the Act' for short), for appointment of the sole Arbitrator.

2. According to the learned counsel for the applicant, the applicant is the contractor who undertakes government contracts for supplying material/goods in relation to contracts entered with the Government and the Semi-Government Organization.

3. The respondent, the Cantonment Board, had invited tenders for "repair and maintenance of roads" in the year 2016. Consequently, the applicant had submitted his rates for the work on 15.11.2016. By order dated 30.03.2017, the said tender was accepted by the respondent. Therefore, the work order contract was issued on 06.04.2017.

4. According to the work order contract, it was agreed that the respondent shall make payments within the time stipulated under the agreement. Moreover, the respondent was under the duty to clear all the bills of the applicant within 18 days' after which the amounts had become due.

5. According to the applicant, despite the fact that the work order was completed with utmost satisfaction, no payments were received by the applicant in relation to the work orders, which are as under:-

S. No.	Work Order	Amount/Valu e (in INR)	Amount of Bill (in INR)	Date of Bill
1.	Improvement of children park and shops below Cantt. Octroi Post Kailana (05th April, 2017)	1,29,98,000/-	12,58,593.93/-
2.	Repairs of 6 Nos. Old dustbins at various places in Cantt. Area (18th September, 2017)	6,37,800/-	6,64,930.07/-	25.06.2018
3.	Providing 10 Nos. Dustbin at various places in Cantt. Area and parapet wall (18th September, 2017)	4,93,310/-	5,06,437.95/-	20.06.2018
4.	Providing street light point in Cantt. Area 10 Nos. (17th November, 2017)	6,06,900/-	6,46,295.48/-	20.06.2018
5.	Providing fencing of angle iron and barbed wire around Patia Dhar Cantt. Garden (17th November, 2017)	55,04,000/-	19,03,150/-	30.12.2018
6.	Shops into Community Hall below Cantt. Oct. Post Kailana (Children Park) (5th March, 2018)	17,79,000/-	19,56,900/-	30.12.2018
7.	Three Boar Well Flate at Cantt. Area (05th March, 2018)	10,24,200/-	11,04,111.50/-	28.06.2018
8.	Providing white washing etc. of Cantt. Fund Qtrs, Schools Office Board Room parapet wall retaining wall (CBR 23rd May, 2018)	23,12,800/-	25,14,167.83/-	21.03.2019
9.	Repairs to retaining wall which has been totally damaged due to heavy rainfall below Chinta Haran Temple (14th October, 2018)	1,84,600/-	1,94,075.95/-	26.10.2018
10.	Retaining Wall for perfect erosion below hill side building path of Children Park to damage due to heavy rainfall (14th October, 2018)	11,10,900/-	12,09,935.35/-	28.10.2018
11.	Providing mild steel railing and flooring and chequered tiles at Children Park Kailana (14th October, 2018)	18,18,100/-	19,83,666.27/-	27.10.2018
12.	Providing retaining wall at Khadra Patiya Dhar Garden Road damaged due to landslide by heavy rainfall (14th October, 2018)	8,52,300/-	6,69,868.28/-	29.10.2018
13.	Protect Road by wire mattresses at Khadra Patiya Dhar Garden Road damaged due to landslide by heavy rainfall (14th October, 2018)	1,54,700/-	1,68,776.21/-	25.10.2018
14.	Estimate for repair to retaining wall which has been totally damaged due to heavy rainfall at Bear Goudown above Safaiwala Qtrs. and shops (14th October, 2018)	7,34,500/-	7,59,202.98/-	03.03.2019
Total Amount of Works		3,02,11,110/-	1,55,40,112.19/-

6. Therefore, according to the learned counsel for the applicant, the respondent owes Rs.1,55,40,112.19/- along with the GST.

7. Since the respondent was not heeding to the request of the applicant, on 17.06.2020 the applicant sent a legal notice requesting the respondent to both clear the outstanding bills and, since disputes had arisen between the parties to appoint the sole Arbitrator, 'the Garrison Engineer'.

8. According to Clause 19 of the Agreement, the parties had agreed that, in case disputes were to arise, 'the Garrison Engineer' shall be appointed as the sole Arbitrator.

9. In the letter dated 17.06.2020, the applicant ha

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2021 Supreme(UK) 622

IN THE HIGH COURT OF UTTARAKHAND AT NAINITALRaghvendra Singh Chauhan, J.Mahendra Singh Rana - AppellantVersusCantonment Board - RespondentArbitration Application No. 21 of 2020Decided On : 06-08-2021

The court emphasized the importance of adhering to the agreed arbitration process and the necessity of an express agreement in writing to waive the bar contained in Section 12(5) of the Act.

IN THE HIGH COURT OF UTTARAKHAND AT NAINITAL
Raghvendra Singh Chauhan, J.
Mahendra Singh Rana - Appellant
Versus
Cantonment Board - Respondent
Arbitration Application No. 21 of 2020
Decided On : 06-08-2021