THE HON'BLE SRI JUSTICE B.SESHASAYANA REDDY Arbitration Application No.60 of 2009 4th July, 2011 Between :- M/s.Madras Fertilizers Limited, Rep.by its authorized signatory Subramanya Reddy .. Applicant And M/s.New Sri Lakshmi Parthasaradhi Fertilizers & Pesticides, Manchalakatta, Gadivemula Manda, Kurnool District. .. Respondent THE HON'BLE SRI JUSTICE B.SESHASAYANA REDDY Arbitration Application No.60 of 2009 ORDER:- This application has been taken out under Section 11(5) and (6) of the Arbitration and Conciliation Act, 1996 read with para 3 (i)(a) of the Scheme for Appointment of Arbitrators, 2006, seeking for appointment of Arbitrator for resolution of the disputes that have arisen in respect of the Dealership Agreement dated 25-8-1993. The applicant is a Public Sector Undertaking under the Department of Fertilizers, Government of India, engaged in the manufacture and sale of fertilizers. The respondent entered into Dealership Agreement dated 25-8-1993 for the purpose of distributing the products of the applicant Company as detailed in the agreement. During the course of transactions, the respondent was found due an amount of Rs.4,33,107/- including interest as on 29-2-2000. The respondent is liable to pay interest at 22% per annum from 1-3-2000 till the date of payment. Apart from the said amount, an amount of Rs.6,98,539/- was due by the respondent to the applicant towards release orders 69-019 and 69-020, dated 30-4-1998. The applicant issued notice dated 11-5-2000 to the respondent for settlement of the accounts in 15 days. Thereupon the respondent issued a reply dated 15-6-2001 disputing the claim of the applicant. The applicant invoked the arbitration clause in the Dealership Agreement and issued notice dated 13-7-2001 nominating Sri R.Arumugam, Advocate, as arbitrator for resolution of the disputes. The respondent opposed the appointment of Sri R.Armugam, Advocate, as the Arbitrator. The applicant through notice called upon the respondent to nominate any of the person of its choice as an Arbitrator. The respondent instead of suggesting the name of the Arbitrator, resorted to dispute the liability. Hence, this application. Notice came to be ordered on 6-6-2011. Notice sent to the respondent returned with endorsement ‘addressee refused’. In view of the said endorsement, it is deemed that notice has been properly served. Heard learned Counsel appearing for the applicant and perused the material placed on record. Learned Counsel appearing for the applicant submits that in view of the agreement dated 25-8-1993, the disputes between the parties are required to be settled by taking recourse to the provisions of the Indian Arbitration Act. Since the disputes between the parties are relatable to the said agreement, the applicant approached this Court invoking the provisions of the Arbitration clause and therefore the application deserves to be allowed. Learned Counsel took me to para 16.0 of the Dealership Agreement dated 25-8-1993. Para 16.0 of the Dealership Agreement dated 25-8-1993 reads as hereunder:- ARBITRATION:- Any dispute regarding the execution, implementation or interpretation of this Agreement or any provisions hereof shall be referred to arbitrators in accordance with the provisions of the Indian Arbitration Act, 1946 or any statutory modification or reenactment thereof. Such arbitration shall be held in the city of Madras and the proceedings shall be conducted in English language.” The applicant invoked the Arbitration clause and proposed the name of Mr.R.Armugam, Advocate, Chennai, as the sole Arbitrator. The respondent refused to give consent and thereupon the applicant issued notice requesting the respondent to propose the name of the sole Arbitrator. The respondent instead of proposing the name, resorted to dispute the liability. Thereby disputes have arisen between the parties and the said disputes are required to be settled by taking recourse to the provisions of the Arbitration and Conciliation Act,1996 as per the Dealership Agreement. In that view of the matter, I find that the applicant made out a valid ground for appointment of the sole arbitrator for resolution of the disputes that have arisen between the parties relatable to Dealership Agreement dated 25-8-1993. Accordingly, the arbitration application is ordered. Sri M.Bhasker, Retd.District Judge, is appointed as sole Arbitrator for resolution of the disputes that have arisen between the parties relatable to Dealership Agreement dated 25-8-1993. He is at liberty to fix his own fee. Arbitrator’s fee shall be incurred by the applicant and the respondent in equal shares. _________________________ B.Seshasayana Reddy, J 4th July, 2011 smr