Jhelum Forest Company vs Conservator of Forests

Mian Jalal-Ud-Din, J.—This is an application u/s 20 of the Arbitration Act. The petitioner seeks the appointment of an arbitrator for

adjudicating upon the disputes which, according to him, have arisen between him and the Forest Department. The petitioner has averred that he

held the lease of Forest Compartment No. 78 Boniyar North Circle in the year 1962. A for mal agreement between the petitioner and the

respondent was signed by the parties. The work period for the lease was fixed upto the end of Nov. 1965 which was later on extended by the

general extension upto November, 1966 and further to the end of November, 1969. According to the petitioner he does not owe anything to the

department as the total royalty including the other bills pay able amounted to Rs. 10,73,852,25 on which Rs. 6,42,746,78 have been paid Heaving

the balance of Rs. 3,31,105.72. The stock position in the forest at the time when the petitioner left the work was that its value was about

4,53,617.00. According to the petitioner the stock lying in the forest is to be adjusted against the balance claimed by the Department. The stock

lying in the forest has been taken over by the Government and reauctioned. The petitioner has averred that he is entitled to reimbursement for the

amount realized by such reauction of the material after the resumption of the lease. A writ of demand has been issued against the petitioner. The

petitioner has averred that the claim of the forest Departmet is disputed in terms of Clause 44 of the agreement. This dispute is to be referred to an

arbitrator designated in the agreement.

The petition has. been resisted by the Forest Department on various grounds. It is averred that it is after six years from December, 1969 when

the last extension expired that the petitioner has chosen to file this petition. The petitioner never during the operation of the lease or thereafter

sought arbitration in respect of any dispute. The present application has been filed in order to delay the payment of the arrears of royalty

outstanding against the petitioner and therefore the application cannot be termed as a bona fide petition. The petitioner is guilty of undue laches and

delay. The dispute sought to be raised by the petitioner in respect of the remanent material in the forest is not entertainable in view of the express

terms and conditions contained in the agreement of lease. The petitioner cannot dispute the very terms of the agreement and therefore reference to

arbitration is-not warranted. In fact there is no dispute or difference that has arisen between the parties in respect of the agreement or the subject-

matter thereof. The petitioner had been shown great consideration by the department inasmuch as the period of lease was extended as many as six

times and he was therefore given all possible facilities to work out the lease and exploit the forest to its fullest capacity during the aforesaid period.

The timber remaining in the coupe after the expiry of the lease is according to the terms of the agreement the property of the Govt. and therefore

the petitioner has no right or claim thereon and he cannot claim any adjustment of the forest stock against the unpaid royalty.

I have heard the learned Counsel for the parties.

Sh. J.L. Choudhary appearing for the petitioner has invited my attention to Govt. Order No. 170 Agri. of 1972 dated 16-2-1972 according to

which the Govt. has sanctioned the adoption of procedure in respect of forest lessees for the purpose of calculation of royalties and finalization of

royalty accounts thereon. In accordance with the said order where the lease has come to an end without the full quantities of marked stock of

being extracted and such stock is resold, the original lessee is to be given credit for the value of the resale subject to certain conditions mentioned

in the order. Relying upon this Govt. order the learned Counsel has submitted that the petitioner is entitled to claim adjustment of the remanent

stock lying in the forest department. According to the learned Counsel as the department has not entertained this claim of the petitioner, therefore a

dispute has arisen between his client and the department which has necessitated the appointment of an arbitrator in terms of Clause 44 of the lease

agreement. In my opinion the request of the petitioner for the appointment of an arbitrator cannot be accepted on the following grounds:

It is clearly mentioned in Clause 11 of the agreement that all the timber remaining in the coupe after the period of lease shall remain the property

of the Govt. In my view the Govt. order cannot have the effect of overriding this clause in the agreement. The order merely lays down the

procedure for the calculation of royalties. If the petitioner has got any grievance on that score or has a claim which he wants the Govt. to entertain,

then his remedy is not to seek arbitration but to approach the Govt. on administrative side and seek his redress there on the authority of the

aforesaid Govt. order.

Clause 44 of the agreement expressly provides that only such disputes as arise between the parties in respect of the subject-matter of the

agreement are to be referred to the Chief Conservator of Forests for his decision. It is clear that what the petitioner seeks adjudication of is not

and cannot be said to be a dispute within the meaning of Clause 44 of the agreement. This is in view of the unambiguous language of Clause 11

thereof.

When the language of the agreement is clear, explicit and express and (sic) does not admit of any exception any other construction than what plain

language connotes it can hard be said that there is any dispute with regard to the subject-matter or the terms of the lease that requires arbitration.

Govt. order relied upon (sic) the petitioner cannot be construed (sic) an addenda to the agreement. If there is any subsequent variation or

modification in the terms of the agreement that too must be in conformitaion with the provisions of the constitution.

Again, according to the agreement the coupe had to last to the end of Nov. 1965. Several extensions were granted thereafter. The petitioner

must have operated upon the lease to its fullest capacity. The last extension granted expired in the year (sic) 1969. The petitioner seeks to (sic) a

matter of 1962-69 in the year 1975 without any ostensible reason or cause. What has the petitioner been doing for all this time has not been

explained. Although no limitation is prescribed for an application u/s 20 of the Arbitration Act, yet it lies heavily on the petitioner to explain the

laches and delay in filing the application which he has not done.

For the foregoing reasons I am of the view that the application merits dismissal. The same is hereby dismissed.