- 1 - S.B.CIVIL MISC. ARBITRATION APPLICATION NO.42/2006 M/s DAYA ENGINEERING WORKS (SLEEPERS) LTD. VS. UNION OF INDIA & ORS. DATE OF ORDER : 4/5/2007 HON'BLE SHRI RAJESH BALIA, J. Mr.Sangeet Lodha, for the applicant. Mr.Vikram Purohit, for the respondents. Heard learned counsel for the parties. The applicant had entered into an agreement with respondents Union of India in its Department of Railways (Northern Railways) for supply of certain materials at Degana. The dispute having arisen between the parties, the applicant called upon the respondents to appoint an arbitrator vide Annex.11 dated 26/9/2005 in terms of the arbitration clause under the agreement. The said letter was responded to vide Annex.12 dated 25/10/2005 stating that unless specific claim is submitted by the applicant, the dispute cannot be referred to arbitrator. Pursuant to same, further dispute had arisen but the applicant submitted its specific claim vide communication dated 22/2/2006 for a sum of Rs.26,22,753/- and required the respondents to appoint an arbitrator in furtherance of its earlier notice. The respondents again declined by stating that request for referring the case to arbitration is considerable only after submission of reasonable and justified claim by the applicant. - 2 - Whether the claim is maintainable or reasonable is a matter to be adjudicated by the arbitrator and not for the respondents as a party to dispute while considering the notice for referring the dispute to arbitration. This only signifies that a live dispute exists between the parties, which is referable to arbitration under the arbitration clause of the agreement and since the respondents have failed to refer the dispute to arbitration in terms of agreement despite notice, this application under Section 11 of the Arbitration and Conciliation Act, 1996 has been filed. Two fold contention raised by the respondents are firstly that High Court of Judicature for Rajasthan had no jurisdiction to entertain the application and secondly that General Manager (Northern Railways) has not been made party. Both the contentions are devoid of any substance. The dispute having arisen within the territorial jurisdiction of High Court of Rajasthan, this Court has jurisdiction to entertain this application under Section 11 of the Act of 1996 and necessary party in such cases is Union of India and not the officer by name. Thus, the objections raised by learned counsel for the respondents are rejected. Accordingly, this application is allowed. Shri Mandal Prasad - 3 - Bohra, a retired District Judge, at present residing at Jodhpur is hereby appointed as sole arbitrator to whom the dispute shall be referred. The cost of arbitration and fees of the arbitrator shall be as determined by the arbitrator himself. (RAJESH BALIA), J. Pankaj Baweja