THE HON’BLE SRI JUSTICE B.SESHASAYANA REDDY A.A.NO.30 OF 2011 ORDER This application has been taken out under sub Sections 5 & 6 of Section 11 of the Arbitration and conciliation Act, 1996, seeking appointment of an arbitrator for resolution of the disputes arising out of the terms and conditions of Memorandum of Understanding dated 5-2-2010 and Addendum dated 2-4-2010. The facts in brief giving rise to filing this petition are: M/s. Nurock Infrastructure Private Limited – applicant, is a company registered under the Companies Act, 1956, having its registered office at Flat No.203, Aditya Hill Paradise, Nandagiri Hills, Near Chopal Super Market, Hyderabad. The respondent is the owner of 1150 sft in Plot No.C-32, No.573, Shahidnagar, Bhubaneshwar, Orissa; Ac.48-08 cents in plot No.82, Khatta, No.1668, Dist Puri, P.S.Jatni, Orissa; Ac.1-88 decibels in plot No.48, Khatta, No.243/30, Palasa Village, Pangi, P.S. Dist, Cuttack, Orissa, and Ac.1-88 decibels in plot No.48, Khatta No.243/30, Palasa Village, Pangi, Dist Cuttack, Orissa. The respondent had availed certain credit facilities from State Bank of India, Siripuram Branch, Vishakapatnam by mortgaging its properties. The respondent borrowed a sum of Rs.7,50,00,000/- from M/s.Vinson Industries Private Limited to clear its liability to State Bank of India. Thereafter, the respondent approached the applicant for financial assistance and with a business proposal. The applicant and the respondent entered into a Memorandum of Understanding dated 5-2- 2010 whereunder the applicant undertook to clear the liability of the respondent to M/s. Vinson Industries in a phased manner and the applicant was empowered to deal with the properties and put the properties to sale and realise the amount invested and balance to be shared by the applicant and the respondent equally. On 2-4-2010 an Addendum came to be executed between the parties. As per the terms thereof, the applicant was to remit an amount of Rs.1,00,00,000/- and the respondent was to procure patta papers of the properties by 15-4-2010. The respondent failed to secure the patta papers. The applicant paid a sum of Rs.29,00,000/- to the respondent and the respondent confirmed the same vide e-mail dated 7-4-2010. Certain disputes cropped up between the parties relatable to the Memorandum of Understanding and the Addendum. The respondent invoked the arbitration clause in the Memorandum of Understanding dated 5-12-2010 and appointed D.V.Reddy as an arbitrator and informed the same to the applicant by notice dated 18-11-2010. Though the respondent has issued a notice on 18-11-2010 proposing the name of Sri D.V.Reddy, no steps have been taken by him nor the arbitrator to further the arbitral proceedings. Hence, this application seeking appointment of a sole arbitrator for resolution of the disputes between the parties relatable to Memorandum of Understanding dated 5-2-2010 and Addendum dated 2-4-2010. Notice before admission came to be ordered on 11- 4-2011. The applicant was permitted to take out notice to the respondent by registered post and acknowledgment due. In compliance of the order dated 11-4-2011, the applicant took out notice to the respondent and filed proof of service vide letter dated 17-6-2011 issued by the Post Master, Hyderabad Jubilee HO, Hyderabad. Despite notice being served on the respondent, as per the letter of the Post Master, Hyderabad Jubilee HO, Hyderabad on 28-4-2011, the respondent neither appeared in person nor through a counsel. Heard the learned counsel appearing for the applicant and perused the material brought on record. Learned counsel appearing for the applicant submits that existence of the arbitration clause is admitted by the respondent through its notice dated 18-11-2010. Though the respondent nominated D.V.Reddy as an arbitrator, no steps have been taken either by D.V.Reddy or by the respondent to further the arbitral proceedings. He would also submit that the address of D.V.Reddy has not been furnished in the notice dated 18-11-2010 and therefore, the applicant is not in a position to contact the said D.V.Reddy to know as to his willingness to proceed with the arbitral proceedings. Learned counsel took me to the notice dated 18-11-2010. In the said notice, except mentioning the name of the arbitrator, the respondent has not furnished the address of the proposed arbitrator. Even the proposed arbitrator has not entered into reference as on this day. In the circumstances, I find that the applicant has made out a valid ground for appointment of the substitute arbitrator in the place of D.V.Reddy. Accordingly, the arbitration application is allowed appointing Sri B.V.Ranga Raju, a retired High Court Judge, as arbitrator for resolution of the disputes between the parties relatable to Memorandum of Understanding dated 5-02-2010 and Addendum dated 2-4-2010. He shall fix his own fees. ___________________________ B.SESHASAYANA REDDY,J rkk Dated: 8-8-2011