ORDER

Date : 21.09.2022 Heard Mr. T. R. Sen, learned counsel appearing on behalf of Mr. A. Sarma, learned counsel for the petitioner. Also heard Mr. R. S. Mishra, learned counsel for the respondent.

2. The present petition has been filed by the petitioner seeking for appointment of an Arbitrator in terms of Clause 21 of the Contract dated

11.02.2014 between the parties.

3. This application however, has been resisted by the respondent, on the ground that the matter relates to a time barred claim, and as such, in respect of a time barred case, the question of appointment of an Arbitrator does not arise.

4. In order to appreciate the arrival contentions, it may be apposite to refer to the facts of the case in brief.

5. The petitioner is a Public Enterprise, registered under the Companies Act, 1956, engaged in the business of exploration, development and production of crude oil and Natural gas, transportation of crude oil and LPG.

6. The petitioner company entered into a contract with the respondent M/s North East Drilling & Workover Services Co. Pvt. Ltd. for Operation and Maintenance of 1 (one) No. Drilling Rig for a period four (4) years at a total contract cost of Rs. 6,71,22,293.21 (Rupees Six Crores Seventy One Lakhs Twenty Two Thousand Two Hundred Ninety Three and Twenty One) only. The said contract was to be effective from 27.04.2014.

7. It is a case of the petitioner that after the commencement of the contract, the respondent failed to perform satisfactorily on numerous occasions, which led to disruption of the works of the petitioner and the respondent was duly warned of such irregular performance of contract. However, finally as the respondent failed to execute the contract properly, the petitioner was compelled to terminate the contract with the respondent by issuing a notice of termination of contract on 20.06.2015, which was to be effective from

19.08.2015.

8. It is a case of the petitioner that because of non-performance of the contractual obligations, the petitioner company had to take over operation of the drilling rig with the help of in-house personnel w.e.f. 20.07.2015 in terms of Clause 9 and Clause 10.5 of Special Condition of Contract (SCC), which was duly communicated to the respondent vide letter dated 22.07.2015, and accordingly, the said rig under the petitioner company’s operation continued for the period from 20.07.2015 to 18.08.2015, entailing certain expenses and also which caused financial loss to the petitioner company.

9. In view of the above activities, which were compelled to be undertaken by the petitioner on account of failure of the respondent to execute the work, a total recoverable amount of Rs. 1,55,03,625.87 (One Crore Fifty Five Lakhs Three Thousand Six Hundred Twenty Five and Eighty Seven) only become due to be paid to the petitioner by the respondent for the aforesaid period from 20.07.2015 to 18.08.2015.

10. Accordingly, in view of the aforesaid due recoverable from the respondent, the petitioner company served a notice of demand dated 10.08.2019 calling upon the respondent to make payment within 15 days from receipt of the notice.

11. It is the case of the petitioner that inspite of service of notice for payment of the aforesaid due, the respondent did not make payment because of which a notice was issued to the respondent on 26.10.2019, invoking the Arbitration Clause, i.e. Clause 21 of the Contract dated 11.02.2014 for adjudication of the dispute by way of Arbitration.

12. However, the respondent replied to the said notice on 19.11.2019 by stating that the claim is not only false and frivolous, but it is now a stale claim, thus, being barred by law of limitation. Further, the appointment of an Arbitrator by the petitioner unilaterally, by invoking the Clause 21 of the agreement also not permissible.

13. In view of aforesaid said response by the respondent on 19.11.2019, denying the claim as well as the appointment of the Arbitrator, the petitioner has approached this Court by filing the instant