THE HON'BLE SRI JUSTICE B.SESHASAYANA REDDY Arbitration Application No.93 of 2011 19th December, 2011 Between :- Subhash Chandra Patra .. Applicant And Union of India, Rep.by its General Manager, South Central Railway, Rail Nilayam, Secunderabad And others .. Respondents THE HON'BLE SRI JUSTICE B.SESHASAYANA REDDY Arbitration Application No.93 of 2011 ORDER:- This application has been filed by Subhash Chandra Patra under sub-sections (2) and (6) of Section 11 of the Arbitration and Conciliation Act, 1996 read with Scheme for Appointment of Arbitrators, 1996, seeking appointment of Arbitrator to adjudicate the claims and disputes relatable to agreement dated 3-3-2011. The applicant is the Proprietor of Metro Agencies and the lessee of the agreement for leasing of four tonnes parcel space. The contract was awarded to the applicant by the 2nd respondent for a period of three years @ Rs.27,256/- per day inclusive of 2% development charges. The applicant is the registered leaseholder of parcel space in luggage compartment in 18646 East Coast Express for the transportation of parcels from Hyderabad to HWH for a period of three years. The applicant sent a consignment dated 27-6-2011 containing 96 packages of Hatching Eggs, weighing about 1344 Kgs., and 26 packages of Fish, weighing about 1805 Kgs., in all weighing about 3149 Kgs., in the FSLR Space out of 4 tonnes space allotted to him. The Parcel Staff at Vijayawada unloaded the major part of the consignment on the pretext that the applicant has sent excess consignment weighing about 2941 Kgs., and imposed a penalty amount of Rs.95,126/- which has been paid by the applicant under the protest on 28-6-2011. As per the Railway guidelines, the consignment cannot be unloaded at intermediate station without information of lessee except at the destination. The respondents, according to the applicant, have willfully and miserably and mischievously unloaded the consignment at Vijayawada violating the guidelines and thereby committed breach of contract. Some mischief occurred during the intermediate locations/stations with regard to the consignment loaded by the applicant and thereby the applicant sustained loss of Rs.3,00,000/-. Thereby disputes arose between the applicant and the respondents relatable to the goods consigned on 27-6-2011. As per clause 25.0 of the terms of the agreement, the disputes between the parties are required to be settled by an Arbitrator. The applicant issued a notice dated 30-6-2011 requesting the respondent to appoint an Arbitrator for resolution of the disputes. The respondent No.2, instead of appointing an Arbitrator, terminated the contract vide letter No.C/C/37/AGC/7016/Metro/2008/II, dated 1-7-2011. Hence, this application seeking the prayer stated supra. The respondent filed counter. It is stated in the counter that the applicant did not submit any request for nomination of Arbitrator to the General Manager and therefore the application is not maintainable. Heard learned Counsel appearing for the parties. Learned Counsel appearing for the applicant submits that the applicant issued a legal notice dated 8-8-2011 to the General Manager, South Central Railway, Secunderabad – 1st respondent to appoint an Arbitrator to settle the disputes but the 1st respondent having received the notice failed to appoint an Arbitrator and therefore the applicant approached this Court invoking the jurisdiction under sub-sections (2) and (6) of Section 11 of the Arbitration and Conciliation Act. Learned Counsel appearing for the respondents submits that the applicant has not followed the procedure contemplated in the agreement and therefore the application filed by the applicant is liable to be dismissed. In a way his contention is that the applicant without making any other controversial statement is required to submit a representation to the Senior Divisional Commercial Manager – respondent No.2 seeking appointment of an Arbitrator and that the notice dated 8-8-2011 cannot be construed as a representation. I have gone through the notice dated 8-8-2011 addressed to the respondent No.1. The relevant portion of the notice dated 8-8-2011 needs to be noted and it is thus:- “I hereby call upon you to appoint an Arbitrator expeditiously, to settle the dispute within a time frame, while setting aside the impugned order dated 8-8-2011, as your authorities in all other matters or arbitration, have hardly shown any concern in arbitrating the matters of disputes, numbering about four or five cases and they are pending adjudication and a lot of loss has been incurred by my client and taking into account all these aspects, I request you to act upon judiciously and redress my client’s grievance by appointing an Arbitrator in the subject matter, failing which my client will have no option but to take appropriate action deemed fit under law, at your costs and consequences.” The request made by the applicant in the notice dated 8-8-2011 can definitely be construed as a representation to the 1st respondent seeking appointment of an Arbitrator. The 1st respondent having received the notice failed to appoint an Arbitrator, which necessitated the applicant to approach this Court seeking the relief stated supra. In that view of the matter, I find that the applicant has made out a valid ground for appointment of an Arbitrator. Accordingly, the Arbitration Application is allowed. Sri N.Sanyasi Rao, a retired District Judge, is appointed as Arbitrator for resolution of the disputes between the applicant and the respondents relatable to the Agreement dated 3-3-2011. He is at liberty to fix his own fee. No order as to costs. _________________________ B.Seshasayana Reddy, J 19th December, 2011 smr