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3. On account of the disputes between the parties,  the   petitioner   activated   the   arbitration   clause   by  issuing a notice dated 22.12.2015 raising a claim of  Rs.20,43,89,463/­ and requested the respondent to send  a panel of three arbitrators to enable the petitioner  to select one of them to act as a sole arbitrator.  

4. In   response   to   the   said   letter,   WAPCOS   Ltd.  suggested names of three arbitrators under its letter  dated   12.03.2016.     Upon   receipt   of   the   letter,   the  petitioner under letter dated  22.03.2016  conveyed to  WAPCOS   Ltd.   that   as   per   amended   section   12   of   the  Arbitration and Conciliation Act, 1996, ('the Act' for  HC-NIC Page 4 of 12 Created On Sat Sep 09 15:54:50 IST 2017 O/IAAP/69/2017 ORDER short), the proposed arbitrators are required to make  a declaration in the form provided under the schedule  to the Act.  The petitioner requested the WAPCOS Ltd.  to supply such declarations.  

12. The action of the respondent company in sending a  panel of three names, all being clearly ineligible to  act   as   an   arbitrator,   that  too   without  applying  sub  section (1) of section 12, cannot be seen as having  discharged   its   duty   under   an   arbitration   clause  governing the parties. Arbitration clause undoubtedly  requires the appointing authority to react within 90  days   from   the   date   of   receipt   of   notice   from   the  contractor   seeking   arbitration.     However,   such  requirement  cannot   be   seen  in  isolation   and   must   be  seen in light of the amended section 12 of the Act.  The   respondent   cannot   claim   satisfaction   of   such  requirement   by   suggesting   names   of   three   ineligible  arbitrators that too without necessary declaration to  enable the petitioner to verify whether anyone of them  suffered from any ineligibility.   The requirement of  suggesting names of three persons was coupled with the  HC-NIC Page 10 of 12 Created On Sat Sep 09 15:54:50 IST 2017 O/IAAP/69/2017 ORDER duty   to   suggest   the   persons   who   were   otherwise   not  ineligible.