Shri Naresh Maheshwari vs The Commissioner (MCD) and Another

Anil Kumar, J.—This is a petition u/s 11(6) of the Arbitration and Conciliation Act, 1996 by the petitioner for appointment of the Arbitrator for adjudication of disputes which has arisen between the petitioner and the respondents.

The petitioner contended that the respondents had invited tenders on 19th December, 2006 for car/scooter parking site behind Sales Tax Office, ITO, New Delhi. The petitioner had filed the bid and his bid being the highest was accepted and the respondents vide letter dated DC/RPC/Zone Code 07/DES 283 dated 9th August, 2007 issued a provisional letter for running the parking site at monthly license fee of Rs. 88,733/- per month inclusive of applicable taxes for a period of five years, subject to enhancement of monthly license fee by 5% on satisfactory completion of every year of contract.

The petitioner contended that he expressed his acceptance by letter dated 10th August, 2007 and deposited the security amount equivalent to three months license fee and 11 post-dated cheques of the license fee and one month''s license fee in advance was paid.

The petitioner asserted that on 18th September, 2007, the possession of the parking site behind Sales Tax Office, ITO, New Delhi, was handed over and the respondent also informed the SHO, Police Station, I.P. Estate, New Delhi, about the allotment of parking site. However, on 24th September, 2007, Institute of Town Planners addressed a letter to the respondent raising objections to the allotment of the parking site on the ground that it will cause problems in their ingress and egress and they did not allow the petitioner to operate some part of the site allotted to him.

The petitioner pleaded that by letter dated 17th December, 2007, he informed the respondent about the obstructions in using the parking site. The petitioner also pointed out that the entire parking site cannot be used as the substantial part of it was covered with malba, dustbin and dust and other material and consequently 60% of the portion of the parking site was not useable. In the circumstances, the petitioner prayed for apportionment of license fee according to proportionate area which was available for parking. The respondents, however, did not accede to the request made by the petitioner and the dispute arose between the petitioner and the respondents.

The agreement executed between the petitioner and the respondents has an arbitration Clause 26 and consequently the petitioner invoked the arbitration agreement and requested for appointment of the Arbitrator. However, since March 2008, the respondents has not appointed any Arbitrator. It is contended that instead of appointing an Arbitrator, the respondents issued show cause notice and started claiming full license fee and the request made by the petitioner for proportionate decrease of the license fee has not been considered nor any Arbitrator has been appointed.

Though the petitioner had given the notice dated 20th March, 2008 seeking appointment of an Arbitrator in terms of arbitration clause, the respondent had not appoint an Arbitrator till the filing of the present petition on 28th January, 2009.

The notice of the petition was issued to the respondents and the notice was accepted on behalf of respondent by a counsel who sought two weeks'' time on 24th February, 2009. Despite the time given by this Court, the reply has not been filed nor any sufficient reason has been disclosed for not filing the reply. Consequently, the right of the respondents to file the reply is closed.

Learned Counsel for the respondent has contended that in view of the Clause 26, which contemplates that no person other than one nominated by the Commissioner, MCD, shall act as an Arbitrator, this Court shall not be competent to appoint any other person as an Arbitrator. The plea of the respondents is not acceptable. The notice invoking the arbitration agreement and seeking appointment of an Arbitrator was sent on 20th March, 2008 and received by the respondent. Despite that for almost a year, Arbitrator has not been appointed. In the circumstances, the respondents have lost right to appoint an Arbitrator and it will be competent for this Court to appoint any person as an Arbitrator.

At this stage, learned Counsel for the petitioner has contended that petitioner is a poor person and he has already suffered substantial loss on account of the complete site not being handed over to him. Consequently the learned Counsel for the petitioner contended that an arbitrator may be appointed by the respondent, however, petitioner shall not be liable to pay arbitration fees to such an arbitrator appointed by the Commissioner of Municipal Corporation of Delhi.

Learned Counsel for the respondents on instructions, states that Mr. R.P. Aggarwal, Assistant Commissioner, City Zone, can be appointed as an Arbitrator and if Mr. Aggarwal is appointed as an Arbitrator, no fees for the arbitration shall be payable by the petitioner.

In the circumstances, Mr. R.P. Aggarwal, Assistant Commissioner, City Zone, is appointed as an Arbitrator to adjudicated all the disputes raised by the petitioner. The Arbitrator shall be entitled to devise his own procedure. Since the Arbitrator is an Official of Municipal Corporation of Delhi, no fee will be payable by the petitioner to the Arbitrator. Parties are directed to appear before the Arbitrator on 27th March, 2009 at 4 PM. A copy of this order be sent to the Arbitrator forthwith. Copies of this order be given dasti to the parties.