THE HON'BLE SRI JUSTICE B.SESHASAYANA REDDY Arbitration Application No.170 of 2010 8th December, 2011 Between :- Poosa Rambabu .. Applicant And A.P.State Warehousing Corporation Rep.by its Managing Director And others .. Respondents THE HON'BLE SRI JUSTICE B.SESHASAYANA REDDY Arbitration Application No.170 of 2010 ORDER:- This application has been taken out by Possa Rambabu under sub-sections (5) and (6) of Section 11 of the Arbitration and Conciliation Act, 1996, seeking appointment of an Arbitrator for resolution of the disputes that have arisen in respect of the agreement of H&T Contract dated 28-10-2005. The petitioner constructed 6 godowns at Bibinagar, each godown with a capacity of 5,000 M.Ts. by obtaining ﬁnance from the Banks. His godowns have been taken on lease by the Andhra Pradesh State Warehousing Corporation – 1st respondent. An agreement came to be entered between the applicant and the 1st respondent - Andhra Pradesh State Warehousing Corporation with regard to Handling and Transportation. The period of the agreement was two years commencing from 24-9-2003 at the rate of 585% ASOR (Above the schedule rates). The period of contract came to be extended for the next two years i.e., from 28- 10-2005 at the same existing rates. The applicant has been demanding Preservation and Maintenance Charges @ 585% ASOR. Sine the 1st respondent has not paid the amount at the agreed rate, the applicant issued a notice dated 28-4-2009 to the 1st respondent invoking the arbitration clause in the tender document for resolution of the disputes relatable to the H&T Contract dated 28- 10-2005. The 1st respondent under letter dated 6-6-2009 rejected the request of the applicant. Hence, this application. Notice to the respondents came to be ordered on 16-11-2010. Respondents No.1 to 3 ﬁled counter affidavits. It is stated in the counter aﬃdavit of the 1st respondent that bilateral proceedings are going on regarding hike of ASOR between the 1st respondent and 2nd respondent and therefore the present application is liable to be dismissed. Heard learned Counsel appearing for the parties. Learned Counsel appearing for the applicant submits that the 1st respondent having agreed to pay Handling & Maintenance Charges at 585% ASOR failed to pay the same and thereby disputes have arisen relatable to the agreement dated 28-10-2005. Learned Counsel further submits that as per the the Tender for Handling and Transport Operation Agreement, the disputes between the parties are required to be resolved by taking recourse to arbitration clause. Much emphasis has been laid on clause X of the tender document, which reads as hereunder:- “All disputes and diﬀerences arising out of or in any way touching or concerning this agreement whatsoever (except as to any matter the decision of which is expressly provided for in the contract) shall be referred to the sole Arbitrator of any person appointed by the Managing Director, A.P.State Ware Housing Corporation, Hyderabad, it will be no objection to any such appointment that the person appointed is an employee of the corporation that he had to deal with the matters to which the contract relates and that in the course of his duties as such employee of the Corporation he had expressed his views on all or any of the matter in dispute or diﬀerence. The award of such Arbitrator shall be ﬁnal and binding on the parties to this contract. It is a term of this contract that in the event of such Arbitrator to whom the matter is originally referred being transferred or vacating his oﬃce or being unable to act for any reason, the State Warehousing Corporation at the time of such transfer, vacation of oﬃce or inability to act, shall appoint another person to act as Arbitrator in accordance with the terms of this contract. Such person shall be entitled to proceed with the reference from the stage at which it was left by his predecessor. It is also a term of this contract that no person other than a person appointed by the Managing Director, Andhra Pradesh State Warehousing Corporation, Hyderabad as aforesaid should act as Arbitrator and for any reason that is not possible the matter is not to be referred to arbitration at all in respect of those claims. Provided further that any demand for arbitration in respect of any claim(s) of the contractors under the contract shall be in writing and made within six months of the date of termination or completion (expiry of the period) of the contract and where this provision is not complied with the claim (s) of the contractor shall be deemed to have been waived and absolutely barred and the Corporation shall be discharged and released of liabilities under the contract. It is further provided that the Arbitrator may, from time to time, with the consent of the parties enlarge the time for making and publishing the award. Subject as aforesaid the Arbitration Act, 1940 shall apply to the arbitration proceedings under the clause. In case of any dispute, diﬀerences arising out of the contract/agreement, the matter shall be ﬁrst referred to the arbitration as per the arbitration clause provided in the Tender document. The contractor cannot approach to Court of law before referring the dispute for arbitration. All disputes are subject to Hyderabad jurisdiction.” Learned Counsel appearing for the 1st respondent submits that as per arbitration clause in the Tender document, the applicant has to invoke the arbitration clause within six months of the date of termination or completion of expiry of the contract and as the letter dated 28-4-2009 invoking the arbitration clause is beyond the period of six months of the completion of the contract period, the application seeking appointment of Arbitrator is liable to be dismissed. I have gone through the arbitration clause in the Tender document, which has been extracted supra. A plain reading of the above referred clause indicates that the applicant has to invoke the arbitration clause within six months of the date of termination or completion of the contract. Indisputably the contract came to be completed by 28-10-2007. The applicant did not invoke the arbitration clause within six months. It was only on 28-4-2009 the applicant addressed a letter to the 1st respondent. By that date, the six months period stipulated in the tender document had already been expired. There being no request by the applicant to the 1st respondent within the stipulated period seeking the appointment of Arbitrator, the present application invoking jurisdiction under sub-section (6) of Section 11 of the Arbitration and Conciliation Act, 1996, is not maintainable. Accordingly, the application is dismissed. However, the applicant is at liberty to work out his remedies in Civil Court. No order as to costs. __________________________ B.Seshasayana Reddy, J 8th December, 2011 smr