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After filing of an application under Section 11 in The Arbitration Act, 1940, the respondents had lost their right to appoint the arbitrato: Calcutta High Court

This case was filled by SHREE LAXMI IRON AND STEEL WORKS PRIVATE LIMITED against THE EASTERN RAILWAY. The Judgment Shree Laxmi Iron And Steel Works vs The Eastern Railway And Ors (Citation: A.P. No. 316 of 2020) was served by THE HON’BLE JUSTICE PRAKASH SHRIVASTAVA, CHIEF JUSTICE Prakash Shrivastava.  

FACTS OF THE CASE

This application under Section 11 of the Arbitration and Conciliation Act, 1996 has been filed for appointment of arbitrator to resolve the dispute between the parties. Case of the applicant is that the applicant had submitted offer in pursuance to the Notice Inviting Tender floated by the respondents, and, thereafter, purchase order dated 10th of August 2019 was issued to the applicant for supply of 850 sets of joggled fishplates as per the specifications mentioned in the Tender Documents. The delivery period, at the instance of the applicant, was extended by the Railways by a letter dated 26th November 2018. There was some dispute about the inspection by the inspecting agency. Hence, the delivery period at the request of the applicant was again extended up to 8th March 2019 by a letter dated 8th of January 2019. According to the applicant, thereafter, the materials were duly inspected by the inspecting agency and the applicant had dispatched 265 sets of joggled fishplates to the respondents on 25th February, 2019 but respondents had refused to accept it. Hence the dispute arose between the parties. In paragraph 23 of the A.P., the applicant has disclosed that he suffered the loss of damages to the tune of Rs. 90,57,903/- (Rupees Ninety Lakhs Fifty Seven Thousand Nine Hundred Three). The applicant, vide letter dated 26th of June 2020, had invoked the arbitration clause and had sent a panel of three senior advocates seeking concurrence of the respondents for appointment of arbitrator from the said panel. Case of the applicant is that even after the letter dated 26th of June 2020, no arbitrator was appointed nor the dispute was resolved within 30 days. Hence, the respondents have lost their right to appoint arbitrator and, therefore, the applicant has approached this Court for appointment of arbitrator.

JUDGEMENT: The court after going through the Facts and circumstances of the case observed that after filing of the present application under Section 11 of the Act, the respondents had lost their right to appoint the arbitrator. Hence, the panel dated 23rd of December 2020 sent by them is of no consequence. The respondents have failed to appoint the arbitrator in terms of the arbitration clause within time. Hence, the applicant has rightly invoked Section 11 of the Act. The arbitration clause is undisputed and dispute exists between the parties in respect of the claim of payment raised by the applicant. Therefore, a case is made out to appoint the arbitrator to resolve the dispute between the parties. Hence, the proposed the name of Justice Amit Talukdar, retired Judge High Court at Calcutta, resident of 6/1/1, Anil Moitra Road, Kolkata – 700 019 (Near Ballygunge Phari), Mobile No. 8697481474 for appoint as arbitrator to resolve the dispute. Concerned Registrar is directed to obtain his consent in terms of Section 12 (1) in the Proforma prescribed in the Sixth Schedule of the Act.

JUDGEMENT REVIEWED BY AKANKSHA 

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