Arb P/19/2021 of M/S HIMTECH SALES PVT LTD TH ITS MANAGING DIRECTOR Vs J AND K CEMENTS LTD SONWAR SRINAGAR TH ITS MANAGING DIRECTOR AND ANOTHER on 30 December 2022

1. The petitioner has filed instant petition under Section 11 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as “Act”) seeking a direction for appointment of independent Arbitrator to adjudicate the dispute between the parties under arbitration agreement on the strength of averments made and grounds taken in the petition.

2. The facts in brief as stated in the petition are as under:

The respondents agreed to accept the offer of the petitioner to purchase 10.80 lacs of printed (blue colour) bags for packing of cement vide reference No.JKCL:P&P:01 (PP Bags) 2017-743 dated 31.08.2017. On the same date another order for supply of 3.60 lacs bags, beige colour was placed by the respondents for its plant at Samba, Jammu in terms of communication No.JKCL:P&P:01(PP Bags):2017-742 dated 31.08.2017, which also contain the terms of agreement as well as arbitration clause. Thereafter, the petitioner supplied the said quantities of bags and some part payments were also made by the respondents. On non-payment of the balance amount, the petitioner has made several communications as well as telephonic requests to release the payment but his request was not accepted. The petitioner has made a communication dated 09.07.2019, requesting therein for release of sum of Rs.16,17,475.68 which include interest as well. Thereafter, the petitioner had served a legal notice dated 28.01.2021 under the Act for appointment of an Arbitrator and that request of the petitioner was also not considered by the respondents, which forced him to file the present petition.

3. Heard learned counsel appearing for the parties and considered their submissions.

4. When this petition came up for hearing, this Court after hearing learned counsel for the petitioner, vide order dated 05.04.2021, issued notice to the respondents for filing objections.

5. On last date of hearing i.e., on 11.11.2022, Mr. Ravinder Gupta, learned counsel for the respondents was granted two weeks’ time to file objections. Today, when the matter is taken up for hearing, he is again seeking some more time to file objections. His request is declined. Thus, this Court is left with no other option but to decide the petition on the basis of the averments made in it and the submissions made by learned counsel for the petitioner.

6. It would be advantageous to reproduce arbitration clause 13.0 of Supply Offer No.JKCL:P&P:01(PP Bags):2017-743 dated 31.08.2017 hereunder:

“13.0Arbitration

13.1 In the event of any question/dispute, breach of trust or differences arising in response of the meaning and scope of terms and conditions herein or in connection with any matter under this agreement (except for those terms and conditions) the same shall be referred to the sole Arbitrator by an officer of J&K Cements Limited, Srinagar appointed by its Managing Director. There will 3 Arb P No.19/2021

be no objection if the Arbitrator is an employee of the Corporation and he at any time in discharging of his duties as an employee of the corporation has expressed views on all or any of the matter in dispute or difference. In case the employee of the corporation who has been so appointed as an Arbitrator, ceases to be in the employment of the corporation, because of his superannuation or otherwise in any manner shall no longer remain as an Arbitrator from that date and Managing Director of the Corporation shall appoint another employee of the Corporation as sole Arbitrator in his place who shall proceed in the matter from the stage where previous Arbitrator had left the proceedings. The Arbitrator shall give award with reason in respect of each claim, dispute(s). The award of the Arbitrator shall be final and binding on the parties to this contract. The Arbitrator shall be deemed to have entered upon the reference on the date he issued notice to both the parties fixing the first date of hearing. The Arbitrator may from time to time, with the consent of the parties to the contract enlarge time for making the award. Subject as aforesaid, the Arbitration Act 1940 and the rules made there under any statutory modifications thereof for the time being in force shall apply to the Arbitration proceedings under this clause. The work under the contract shall be continued uninterrupted during the pendency of the Arbitration proceedings and no payment due from one to the other party therein shall be withheld on any account of pendency of such proceedings unless such payment relates to the matter under Arbitration. The venue of the Arbitration shall be Srinagar/Jammu or such other place as the Arbitrator at his discretion may determine.”

4 Arb P No.19/2021

7. The petitioner has also served legal notice dated 28.01.2021 to the respondents, Annexure-IV, appended with this petition, invoking arbitration clause 13 as referred to above and sought appointment of an Arbitrator for settlement of the dispute which had arisen between the parties but the respondents have failed to appoint an Arbitrator in the matter.

8. In the given circumstances of the case and in view of the fact that the respondents have failed to appoint an Arbitrator in terms of the work allotment order dated 31.08.2017, Hon’ble Mr. Justice (retd.) Bansi Lal Bhat Judge, High Court of Jammu and Kashmir is appointed as sole Arbitrator who shall proceed in the matter in accordance with the provisions of the Act to make an award within the time provided in the Act itself, after charging the prescribed fee along with incidental expenses to be shared by the parties.

9. The petition stands disposed of accordingly. 10.Registry to communicate a copy of this order to Hon’ble Mr. Justice (retd.) Bansi Lal Bhat Judge, High Court of Jammu and Kashmir, through e-mail as well as ordinary mode.

Jammu: 30.12.2022Surinder

(Tashi Rabstan) Chief Justice (Acting)

Whether the order is speaking? Yes/No Whether the order is reportable? Yes/No