M/S Rudraksh Enterprises vs Union Of India And Anr on 24 April, 2023

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Delhi High Court - Orders

M/S Rudraksh Enterprises vs Union Of India And Anr on 24 April, 2023

1. Issue notice. Mr. Piyush Beriwal, learned counsel, appears on advance notice, and accepts notice on behalf of the respondents. The petition is taken up for disposal with the consent of learned counsel for the parties.

2. By way of the present petition under Section 11 of the Arbitration and Conciliation Act, 1996 ["the Act"], the petitioner seeks appointment of an arbitrator to adjudicate disputes arising between the parties under a contract pursuant to an e-tender bearing No. GE(I) R&D/DDN/09 OF 2019-2020. The contract was awarded by the respondents to the petitioner by a Letter of Acceptance dated 03.08.2019.

3. By virtue of Clause 70 of the General Conditions of Contract, disputes between the parties were to be resolved by arbitration of "an Engineer officer to be appointed by authority mentioned in the tender Signature Not Verified Digitally Signed By:SHITU NAGPAL Signing Date:25.04.2023 11:04:08 ARB.P. 461/2023 Page 1 of 4 documents".

4. Disputes having arisen between the parties, the petitioner sought to invoke arbitration by a letter dated 29.10.2020. It appears from the record that an arbitrator was thereafter appointed, but he resigned on 10.12.2021. Consequently, the respondent called upon the petitioner to give consent for appointment of a fresh departmental arbitrator under Section 12(5) of the Act. By a letter dated 31.12.2022, the petitioner did no agree to this course, and, instead, suggested three persons for the appointment of the arbitrator.

5. It is in these circumstances that the present petition has been filed.

6. Learned counsel for the parties state that, in an identical matter between the same parties, the petitioner had approached this Court by way of ARB.P. 315/2023 [Rudraksh Enterprises vs. Union of India & Anr.], which was disposed of by a co-ordinate Bench vide an order dated 20.04.2023, which reads as follows:-

"1. This petition has been filed under Section 11 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the 'Act') seeking appointment of an Arbitrator for adjudicating the disputes that have arisen between the parties in relation to the "Work Order No.1" dated 30.11.2019 regarding work of "

repairs/replacement of drain, RCC Drain covers, gate, grills path, hard standing, compound wall, retaining wall etc and other maintenance work of technical area A&B at IRDE" placed by the respondent no.2 on the petitioner.

2. Disputes having arisen between the parties, the petitioner invoked the Arbitration Agreement vide notice dated 31.10.2020 requesting the respondent no.1 to appoint an Arbitrator. The respondent no.1, vide its order dated 26.03.2021, appointed an Arbitrator, who resigned on 10.12.2021. By a correspondence dated 21.12.2022, the respondent no.1 called upon the petitioner to give consent for the appointment of an officer from the Department itself as an Arbitrator and waive off the objection under Section 12(5) of the Act. The petitioner did not agree to the same, upon which the respondent no.1 declined the appointment of an Arbitrator.

Signature Not Verified Digitally Signed By:SHITU NAGPAL Signing Date:25.04.2023 11:04:08 ARB.P. 461/2023 Page 2 of 4

3. Though, no reply to this petition has been filed, the learned counsel for the respondents submits that in terms of Clause 7 (b) of the Tender document, pursuant to which the petitioner was awarded the work, the disputes have to be referred to the arbitration of a serving officer having degree of Engineering or equivalent. He submits that therefore only a serving officer can act as an Arbitrator.

4. I am unable to agree with the submission made by the learned counsel for the respondents. In terms of Section 12(5) of the Act, as explained by the Supreme Court in Perkins Eastman Architects DPC and Another vs. HSCC (India) Limited, (2020) 20 SCC 760, the officer of the respondent no.1 cannot act as an Arbitrator, unless such objection is expressly waived by the petitioner. As noted hereinabove, the petitioner is not ready to give such waiver.

5. In view of the above, as the existence of the Arbitration Agreement is not disputed, I see no impediment in appointing a Sole Arbitrator. I, accordingly appoint Ms. Sarika Mehta, Advocate (Mobile: 9654612375) as a Sole Arbitrator.

6. The learned Arbitrator shall give a disclosure in terms of Section 12 of the Act before entering upon the reference.

7. The fee of the learned Arbitrator shall be governed in terms of Schedule IV of the Act.

8. The petition is allowed in the above terms."

7. As the aforesaid order arises in identical circumstances, Mr. Beriwal submits that a similar order may be passed in this case also.

8. Learned counsel for both parties submit that they have no objection to the reference in these proceedings also to the same learned Arbitrator appointed in the aforesaid order.

9. The petition is, therefore, allowed, following the order dated 20.04.2023 in ARB.P. 315/2023.

10. Ms. Sarika Mehta, Advocate [Mobile: +(91)-9654612375] is appointed as the sole Arbitrator to adjudicate disputes between the parties arising out of the e-tender bearing No. GE(I) R&D/DDN/09 OF 2019- 2020, and the Letter of Acceptance dated 03.08.2019.

11. The learned Arbitrator is requested to make a declaration in terms of Section 12 of the Act, prior to entering upon the reference.

Signature Not Verified Digitally Signed By:SHITU NAGPAL Signing Date:25.04.2023 11:04:08 ARB.P. 461/2023 Page 3 of 4

12. The fees of the learned Arbitrator will be computed in terms of the Schedule IV of the Act.

13. The petition stands disposed of in these terms.

PRATEEK JALAN, J APRIL 24, 2023 'pv'/ Signature Not Verified Digitally Signed By:SHITU NAGPAL Signing Date:25.04.2023 11:04:08 ARB.P. 461/2023 Page 4 of 4

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Delhi High Court - Orders