M/s Shivam Infrastructure vs South East Central Railway (SECR) And Ors

Sanjay K. Agrawal, J

Invoking Section 11(6) of the Arbitration and Conciliation Act, 1996 (for short, 'the Act of 1996'), the applicant herein has filed this application for

appointment of arbitrator.

Essential facts leading to filing of this application are as under: -

2.1) The applicant had entered into an agreement on 31-10-2013 for execution of construction work of RUB in lieu of closing of manned level crossing

No.BK-65 at km 877/23-25 between APR - AAL Section and BK-68 at km 888/13 - 15 between AAL - BUH Section under the jurisdiction of

ADEN/SDL, Shahdol Division. The aforesaid contract was awarded for ₹ 4,77,95,883/- vide acceptance letter dated 14-8-2013. It was further

pleaded that general conditions of contract are made applicable to the said agreement according to which in case of any dispute the matter is to be

referred to the arbitrator. It is the further case of the applicant that differences and disputes arisen between the parties and the applicant vide letter

dated 30-6-2017 requested the General Manager (Arbitration), SECR, Bilaspur for appointment of arbitrator, but even after lapse of four months,

arbitrator has not been appointed leading to filing of this application for appointment of arbitrator under Section 11(6) of the Act of 1996. 2.2) Reply

has been filed stating inter alia that clause 64.(3)(b) of the agreement entered into between the parties provides for appointment of arbitrator where

applicability of Section 12(5) of the Arbitration and Conciliation (Amendment) Act, 2015, wherein the right to appoint an arbitrator is with the

Railways, as such same was being proposed by the non-applicants in accordance with the arbitration agreement binding between the parties.

However, the claimant denying the same proposed his own panel and did not allow the Railways to appoint arbitrator in accordance with Section 12(5)

of the Act of 1996. Thus, the applicant firm itself, in the Arb. Application No.81/2017 admitted facts of the case, denied appointment of arbitrator in

terms of the arbitration agreement and therefore the applicant is not entitled for appointment of arbitrator and the present application for appointment

of arbitrator deserves to be dismissed.

Mr. Harsh Wardhan, learned counsel appearing for the applicant, submits that in view of the amendment in the shape of Section 11(6A) of the Act

of 1996 by the Arbitration and Conciliation (Amendment) Act, 2015, only the existence of arbitration agreement has to be looked into and all the

defences have to be taken care of by the arbitral tribunal and the said amendment has come into force with effect from 23-10-2015.

Mr. Abhishek Sinha and Ms. S. Harshita, learned counsel appearing for the non-applicants, submits that the application as framed and filed is not

maintainable and the application deserves to be rejected.

I have heard learned counsel for the parties and considered the rival submissions made herein-above and also gone through the record with utmost

circumspection.

At this stage, it would be appropriate to notice Section 11(6A) of the Act of 1996 which has been incorporated in the Arbitration and Conciliation

Act, 1996 by the Arbitration and Conciliation (Amendment) Act, 2015 with effect from 23-10-2015. Sub-section (6A) of Section 11 of the Act of 1996

reads as follows: -

(6A) The Supreme Court or, as the case may be, the High Court, while considering any application under Arb. Application No.81/2017 sub-section

(4) or sub-section (5) or sub-section (6), shall, notwithstanding any judgment, decree or order of any Court, confine to the examination of the existence

of an arbitration agreement.

In the present case also, the general conditions of contract which is a part of the agreement contains the arbitration agreement / clause. Therefore,

an arbitral tribunal for resolving the dispute pertaining to the agreement has to be constituted by granting the present application. The dispute raised by

the non-applicants herein has to be decided by the arbitrator.

As a fallout and consequence of aforesaid discussion, in exercise of power under Section 11(6) of the Act of 1996, I hereby appoint Hon'ble Mr.

Justice Dilip Raosaheb Deshmukh, former Judge of this High Court to arbitrate the dispute. Registry is directed to communicate this order to Hon'ble

Mr. Justice Dilip Raosaheb Deshmukh who shall enter into reference after complying with the provisions contained in Section 12 (2) of the Act of

1996.

The arbitration application is allowed to the extent indicated herein- above. No order as to cost(s).