Bindra Associates vs The Chief Engineer and Another

Hemant Gupta, J.—The Petitioner has sought appointment of an Arbitrator u/s 11 of the Arbitration and Conciliation Act, 1996 (for short ''the Act'') in respect of the disputes arising out of an Agreement bearing No. 6/EE/ACD/2006-07 dated 20.07.2006. The work was for provision of wire guage door, shutters & windows of residential quarters at Custom Colony, Ranjit Avenue, Ajnala Road, Amritsar.

As per the aforesaid Agreement, the Petitioner was to start work allotted on 20.07.2006. The stipulated date for completion of the work was 17.11.2006. It is pleaded case of the Petitioner that the time for completion of the work was extended upto 11.10.2007. The Petitioner completed the work, but incurred loss and damages. In view of the said fact, the Petitioner sought appointment of an Arbitrator vide communication appended as Annexure P-1 to decide the claims of the Petitioner. Thereafter, the Respondents have appointed Shri Divakar Garg, Arbitrator, Ministry of Urban Development, 3rd Floor, C-Wind, I.P. Bhawan, New Delhi as sole Arbitrator vide communication dated 21.04.2009 (Annexure R-1). The reply filed on behalf of the Respondents further shows that since the Petitioner has not put in appearance before the Arbitrator, the Arbitrator has terminated the proceedings vide order dated 23.12.2009 (Annexure R-5).

Learned Counsel for the Petitioner has vehemently argued that the present petition for appointment of an Arbitrator was filed before this Court on 06.03.2009, but the Office of the High Court raised objection. Even if the objections were removed subsequently, the petition would be deemed to be filed on 06.03.2009. Therefore, the appointment of an Arbitrator by the Respondents was after the invocation of jurisdiction by the Petitioner of this Court and, thus, in terms of judgment of Hon''ble Supreme Court in Datar Switchgears Ltd. Vs. Tata Finance Ltd. and Another, , the Respondents are not competent to appoint an Arbitrator.

The Petitioner initially filed the petition u/s 11 of the Act on 06.03.2009. The same was returned with objections by the office of this Court. It was on 27.11.2009, the Counsel for the Petitioner gave a note that the petition be put up before the Bench. It was, thereafter, the present petition was listed for hearing before this Court.

The Respondents have appointed an Arbitrator on 21.04.2009 before the petition came up for hearing for the first time i.e. 11.12.2009. Since the Arbitrator has been appointed before the petition came up for hearing before this Court, I do not find any case is made out for removing the Arbitrator appointed by the Respondents. Such Arbitrator was appointed even before the petition u/s 11 of the Act came up for hearing for the first time. The Arbitrator has been appointed in terms of the Agreement between the parties. There is no reason as to why the Arbitrator appointed in terms of the Agreement be not permitted to continue with the arbitration proceedings when such Arbitrator was appointed much before the petition came up for hearing before this Court.

Mr. Rathee stated that the Arbitrator has passed an order of termination of the arbitration proceedings in the absence of the Petitioner. He states that the Arbitrator should revive the proceedings for arbitration and adjudicate upon the claims of the Petitioner on merits in accordance with law.

Keeping in view the facts and circumstances of the case and the fact that the Petitioner was prosecuting for appointment of an Arbitrator before this Court, it will be fair and reasonable if the disputes raised by the Petitioner are decided on merits rather than on technicalities in the absence of the Petitioner.

Consequently, the present petition is disposed of with a direction to the Arbitrator appointed by the Respondents to adjudicate upon the claims of the Petitioner on merits in accordance with law.