Dharaneppanavar and Bellad Infrastructure and Others vs Tatwadarhsa Health Care Solutions Pvt. Ltd.

B.S. Patil, J.—1. This petition is filed under Section 11(6) of the Arbitration and Conciliation Act, 1996 (for short ''the Act''), seeking appointment of a retired Government Civil Engineer or a retired District Judge or any other qualified person as an arbitrator to settle the dispute that has arisen between the petitioner and respondent.

Petitioner is a partnership firm duly registered under the Indian Partnership Act. Respondent is a Hospital (M/s. Tatwadarsha Health Care Solutions Private Limited) represented by its Managing Director. Petitioner and respondent entered into a construction agreement for construction of a Hospital at Shreya Nagar, Hubballi. The terms and conditions agreed upon by and between the parties regarding construction agreement are reduced into writing and the same are produced at Annexure ''C'' dated 26.05.2011. They are also evidenced by Annexures ''A'' and ''B''.

Petitioner claims to have started the construction of hospital in terms of the contract entered into. According to the petitioner, though construction was carried on at a brisk rate and petitioner kept on submitting bills regularly, only about 80% of the amount billed was released and remaining amount was not released, thus, resulting in financial difficulty and hardship to petitioner. According to petitioner, he has completed entire construction, but the bills submitted by petitioner have not been settled. Therefore, a legal notice was issued on 25.04.2014 as per Annexure ''D'' calling upon respondent to clear outstanding dues. But, the respondent gave an evasive reply dated 28.04.2014 as per Annexure ''E'' and hence, petitioner was constrained to approach this Court seeking appointment of an arbitrator.

It is relevant to notice that petitioner had indeed called upon respondent to refer the matter to arbitrator and for settlement of dispute by way of arbitration. The respondent has filed statement of objections and has denied the allegations and assertions made by petitioner. Respondent has, no doubt, accepted the fact that there is a Clause in the agreement for resolution of dispute through arbitration, but has contended that procedure prescribed in the agreement was not followed by petitioner and therefore, the matter could not be referred to arbitration.

The relevant Clause in the agreement is at Clause (X). It provides that if there is breach of contract, same shall be settled by the Architect by issuing a Final Certificate. If the parties are not satisfied with the decision of the Architect or regarding withholding of issuance of certificate by him, then they were entitled to give a written notice to the other party requiring the matter in dispute to be arbitrated upon and the matters in dispute shall be referred to the single arbitrator being a qualified technical person to be agreed by both parties or in case of disagreement regarding appointment of a single arbitrator, then each party can appoint one arbitrator and the arbitrators so appointed, may select/appoint an umpire. The Clause further makes it clear that the arbitrator, the arbitrators or the umpires, as the case may be, shall have power to open up, review or revise and to determine all matters in dispute, which shall be submitted to him and of which notice has been given by parties.

It is, thus, clear from the Clauses enumerated above that the parties have agreed for resolution of their disputes through arbitrator. It is not in dispute that petitioner has gone on submitting his bills and demanding settlement of his dues. The architect has not issued any Certificate. On the other hand, it is urged by the respondent, that the architect has opined and certified that the construction was not completed.

The fact remains that a dispute has arisen and same has not been settled through the help of architect. Both parties have also failed to agree upon a single arbitrator to resolve the dispute. In this background, learned counsel for both parties were directed to suggest the names of one arbitrator each from their side. Accordingly, petitioner has suggested the name of one Sri. Basavaraj Koti S/o. M.D. Koti, Retired Chief Engineer, Karnataka Public Works Department, Resident of No. 690, 9th Cross, 10th Main Road, Vijaya Nagar, 1st stage, Mysore-570017. In deed, his name had been suggested by petitioner in the notice issued.

Learned counsel for the respondent submits that in the reply submitted by them on 23.12.2015, they have reserved their right to furnish the name and details of arbitrator to be appointed on their behalf, to decide the dispute as per the agreement. In pursuance to the same, learned counsel for respondent has furnished the name of one Sri. G.C. Tallur, B.E.,B.A.,F.I.E., Former Secretary PWD, Government of Karnataka, "SUSHANTY", Plot No. 90, 2nd Main, 11th Cross, Nirmal Nagar, Dharwad-580003, Karnataka, as arbitrator.

In the light of the above, this petition is disposed of. Sri. Basavaraj Koti S/o. M.D. Koti, Retired Chief Engineer, Karnataka Public Works Department, Resident of No. 690, 9th Cross, 10th Main Road, Vijaya Nagar, 1st stage, Mysore-570017 is appointed as arbitrator, as chosen by petitioner and Sri. G.C. Tallur, B.E.,B.A.,F.I.E., Former Secretary PWD, Government of Karnataka, "SUSHANTY", Plot No. 90, 2nd Main, 11th Cross, Nirmal Nagar, Dharwad-580003, Karnataka, is appointed as arbitrator, as chosen by respondent.

Both the arbitrators are at liberty to select and appoint an umpire. The arbitrators are directed to enter upon appearance and decide the dispute that has arisen between the parties in connection with the contract entered into by petitioner and respondent, as is evident from Annexures ''A'', ''B'' and ''C'' produced along with this petition.

Originals of Annexures ''A'', ''B'' and ''C'' shall be returned to petitioner, to enable him to produce them before the arbitrator, on photostat copies of the same being substituted by him.