Arbitration Case No. 69 of 2008 [1] IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Date of Decision: February 20, 2009 Pawan Kumar ......... Petitioner versus Hindustan Petroleum Corporation Limited and others .......... Respondents Present:- Shri Sandeep Khunger, Advocate for the petitioner. Shri Anil Malhotra, Advocate for the respondents. HEMANT GUPTA, J. The present petition under section 11(6)(c) of the Arbitration and Conciliation Act, 1996 (hereinafter to be referred as “the Act”) is for appointment of an Arbitrator to resolve the disputes arising out of Memorandum of Agreement dated 1.9.2006 entered between the petitioner and the respondent-Corporation. Clause 66 of the agreement, Annexure P-1, reads as under:- “ Any dispute of difference of any nature whatsoever or regarding any right, liability, act, omission or account of any of the parties hereto arising out of or in relation to this agreement shall be referred to the sole arbitration of the Managing Director of the Corporation or of some office of the Corporation who may be nominated by the Managing Director. The dealer will not be entitled to raise any objection to any such arbitrator on the ground that the arbitrator is an officer of the Corporation or that he has to deal with the matters to which Arbitration Case No. 69 of 2008 [2] the contract relates or that in the course of his duties as an officer of the Corporation he had expressed views on all or any of the matters in dispute or difference. In the event of the arbitrator to whom the matter is originally referred being transferred or vacating his office or being unable to act for any reason the Managing Director as aforesaid at the time of such transfer, vacation of office or inability to act, shall designate another person to act as arbitrator in accordance with the terms of the agreement such person shall be entitled to proceed with the reference from the point at which it was left by his predecessor. It is also a term of this contract that no person other than the Managing Director or a person nominated by such Managing Director of the Corporation as aforesaid shall act as arbitrator hereunder the award of the arbitrator so appointed shall be final, conclusive and binding on all parties to the agreement, subject to the provisions of the Arbitration Act, 1940 or any statutory modification of or re-enactment thereof and the Rules made thereunder and for the time being in force shall apply to the arbitration proceedings under this clause The award shall be made in writing within six months after entering upon the reference or within such extended time not exceeding further four months as the sole arbitrator shall by a writing under his own hands appoint”. The petitioner has sought appointment of an Arbitrator vide notice dated 24.03.2008, Annexure P-3. Since the Arbitrator to resolve the dispute in terms of the agreement aforesaid was not appointed within thirty days, the petitioner approached this Court by way of present application on 6.5.2008. It is only on 21.05.2008, the respondent-Corporation appointed the Arbitrator. Similar issue, as is raised in the present petition, was dealt with in Arbitration Case No. 23 of 2008 titled M/s Vijay H.P. Filling Centre vs. Arbitration Case No. 69 of 2008 [3] Hindustan Petroleum Corporation Limited and others, decided on 06.02.2009 by this Court, wherein the plea raised by the respondent that the respondent has a right to appoint the Arbitrator in terms of Clause 66 of the Agreement was negatived. The judgments referred to by learned counsel for the respondents including that of larger Bench in Northern Railway Administration, Ministry of Railway, New Delhi vs. Patel Engineering Company Ltd., 2008(10) SCC 240; Ace Pipline Contracts (P) Ltd vs. Bharat Petroleum Corporation Limited (2007) 5 SCC 304 and Union of India vs. Bharat Battery Manufacturing Co (P) Ltd, (2007) 7 SCC 684, were taken into consideration while arriving at the conclusion that the Corporation has lost the right to appoint the Arbitrator after the expiry of 30 days of the notice calling upon the Corporation to appoint an Arbitrator. Learned counsel for the respondent-Corporation has raised argument that this Court is to appoint an Arbitrator having due regard to the qualifications and other circumstances as to secure the appointment of an independent and impartial Arbitrator. It is contented that even in exercise of the powers under section 11(6) of the Act, officer of the Corporation alone is required to be appointed as an Arbitrator keeping in view sub-section (8) of section 11 of the Act. I have heard learned counsel for the parties at some length but do not find any merit in the arguments raised by the learned counsel for the respondents. Sub-section (8) of Section 11 of the Act requires appointment of an Arbitrator who is independent and impartial. The Court will have due regard to the qualifications, if any, specified in the agreement or such other circumstances which may be relevant for the appointment of an Arbitrator. The clause reproduced above does not contemplate any Arbitration Case No. 69 of 2008 [4] qualification required of an Arbitrator. Therefore, the argument raised by the learned counsel for the respondents that only the officer of the Corporation is required to be appointed an Arbitrator is not tenable. The Corporation has failed to act within 30 days of the dispute having been raised, therefore, the Corporation cannot be permitted to assert that the officer of the Corporation alone is required to be appointed as an Arbitrator. The failure of the Corporation to act within the time prescribed disentitle it to restrict the jurisdiction of this Court for appointment of an independent and impartial Arbitrator. This Court in M/s Vijay H.P. Filling Centre's case (supra) has appointed a former District Judge as an Arbitrator i.e., keeping in view sub- section 8(2) of Section 11 of the Act. In view thereof, the argument raised by the respondent-Corporation that only the officer of the Corporation is to be appointed as an Arbitrator is misconceived and not tenable. Consequently, relying upon the reasoning given in M/s Vijay H.P. Filling Centre's case (supra), present application is allowed and Shri P.C. Singhal, retired District Judge is appointed as an Arbitrator. The Arbitrator shall determine his own fee and other terms. The Registry of this Court shall furnish a copy of this order to the Arbitrator appointed. February 20, 2009 ( HEMANT GUPTA ) ks JUDGE