Mahesh C. Puri vs State of H.P. and Another

Surjit Singh, J.—Respondents had awarded some civil work to the Petitioner, after accepting tender submitted by him. Agreement was executed, which is Annexure C-1. It contains arbitration clause for adjudication of dispute(s) arising between the parties by an Arbitrator, to be nominated by the Engineer-in-Chief. A dispute arose, according to the Petitioner, and he approached the Engineer-in-Chief for appointing an Arbitrator. Copy of the notice is Annexure C-2. It was sent by registered post and its copy was endorsed to Respondent No. 2. Postal receipts are pasted at the bottom of last page of notice, Annexure C-2. Despite service of notice and expiry of prescribed period, Arbitrator has not been appointed.

Respondents, in their reply, do not deny that the Petitioner was awarded some civil work and agreement, Annexure C-1, was executed and also do not deny that a dispute has arisen. However, they have stated in the reply that notice requesting for appointment of an Arbitrator has not been sent by the Petitioner.

Reply has been filed by the Superintending Engineer of the Public Works Department, who himself is not a party to the present petition. Copy of the notice, Annexure C-2, was not endorsed to him, but notice was addressed to the Engineer-in-Chief and its copy was endorsed to Respondent No. 2, Executive Engineer. Neither the Engineer-in-Chief has filed his affidavit denying the receipt of notice, Annexure C-2, nor has Executive Engineer filed any reply/affidavit saying that the copy of notice had not been received by him. Postal receipts are there, which show that notice had been sent to Engineer-in-Chief and Executive Engineer by registered post on 7th January, 2011. So the presumption is that the same was duly delivered to the addressee.

As per arbitration clause, which is numbered 25.1 in Annexure C1, party seeking adjudication by an Arbitrator would approach the Engineer-in-Chief or Chief Engineer, Central Zone, Mandi, for appointment of an Arbitrator. Petitioner having approached the Engineer-in-Chief for appointment of an Arbitrator vide notice, Annexure C-2, on 7th January, 2011, and the Engineer-in-Chief having failed to appoint an Arbitrator, the present application is allowed and Sh. M.D. Sharma, Retired District and Sessions Judge, is appointed as an Arbitrator. His fee is fixed at Rs. 40,000/- plus Rs. 5,000/-, as secretarial expenses, which shall be paid, in the first instance, by the Petitioner and ultimately, liability for such expenses shall be determined by the Arbitrator himself.