1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGNAL SIDE JURISDICTION Arbitration Application No.84 of 2006 M/s Tekson Engineering Co., C/542/1083, Behind Venus Talkies Ulhasnagar 421004 ..Applicants vs l. Union of India Engineer in Chief Directorate of Contract Administration and Management AHQ Kashmir House New Delhi 110011 2. The Chief Engineer(Fy) Opp Parade Grounds Sardar Patel Road Secunderabad 500003 . Respondents Mr. U. S. Samudrala the applicants. Ms. S.I. Shah for respondents CORAM: SWATANTER KUMAR,C.J. Judgment reserved on 13.7.2007. Judgment pronounced on 17.8.2007 JUDGMENT:- This is an application filed with a prayer for appointment of named sole arbitrator in accordance with the provisions of section 11(6) of the Arbitration and Conciliation Act, 1996, hereafter referred to as the “Act”, for adjudicating the claim of 2 the applicants as stated in Exhibit C to the application. The relevant facts are that the respondents invited tender notice on 27th February 2001 and in pursuance thereof the applicants were awarded the work of repairs/ replacement of roof sheet valley gutters in heat treatment shop at MPF Ambernath. The value of the tender was Rs.15,42,976.50. The parties entered into an agreement on the very same day, being Contract bearing No.GE(I)(P)FY/AMBR/30 of 2000-2001. Clause 70 of the general terms and conditions of the contract was made applicable to the agreement to be signed by the parties. The stipulated date of completion of work was 26th August 2001. It is the case of the applicants that the respondents created various hindrances and breaches of the contract. It is, inter alia, stated that the respondents failed to give the site in time and two bays of third shed were handed over to the applicants only on 7th January 2002, nearly a year later. The applicants completed the work worth Rs.19,00,908/-, which amount was not paid. The applicants, therefore, served notice dated 10th June 2005 upon the respondents requiring them to appoint an arbitrator and refer for arbitration the claim stated by the applicants. However, same was not even responded by the respondents, resulting in filing the present application on 20th October 2005. 3 There was no dispute to the fact that clause 70 of the general terms and conditions is attracted and the same is an existing and binding arbitration agreement between the parties. It was disputed that delay was caused for the reasons beyond the control of the respondents and the applicants were compensated by granting extension of time and the project was actually completed on 30th November, 2006. The main stand taken by the respondents is that no claim certificate was received from the applicants. Thus there is no dispute which can be referred within the meaning of section 11 of the Act. During the course of hearing the learned counsel for the respondents has raised same issue and vide order dated 22nd June 2007 this court issued direction as under: “Learned counsel appearing for the respondents is directed to produce on record the “No Claim Certificate” which is stated to have been given, as referred to in paragraph 2 of the reply affidavit. S.O. to 6th July 2007”. Despite the above order no such certificate was produced and in fact none appeared thereafter on 6th July 2007, when the following order was passed: 4 “Despite the order dated 22nd June, 2007, No claim certificate has not been produced by the respondents. In fact, nobody is present on their behalf. S.O. to 13th July 2007. Liberty granted to the learned counsel for the applicant to inform the learned counsel for the respondent about the next date.” There is no dispute to the arbitration clause as well as the fact that despite notice the respondents failed to act within the stipulated period and compelled the applicants to file the present application in terms of the arbitration agreement. Again the notice dated 10th June 2005 issued by the applicants to the respondents had clearly asked for invocation of the arbitration clause and even appointment of sole arbitrator which was received by the respondents. Apparent conclusion of the above events is that the respondents have failed to act in terms of the existing and binding arbitration clause between the parties despite notice. They have lost their right in terms of the judgment of the Supreme Court in the case of Datar Switchgears Ltd vs Tata Finance Ltd and anr. (200) 8 SCC 151 and S.B.P and Co vs Patel Engineering Ltd and anr. 2005(3) Arb L.R. 285 (SC). 5 The only stand taken before the court was with regard to the issue that the no claim certificate was not submitted, which despite the order of this court, has not been produced before this court. Thus it cannot be disputed at this stage whether there is referable dispute to the arbitrator in accordance with clause 70 of the Arbitration Agreement. Various claims have been raised in Exhibit C to the application. In any case within the scope of section 16 of the Act even the applicants can raise this issue before the learned arbitrator, where evidence has to be led by the parties in accordance with law. In view of the above discussion, I allow this application under section 11(6) of the Act and hereby appoint Shri I.G. Shah, retired Judge of this Court as the sole arbitrator, who may enter upon the reference and proceed with in accordance with law. Parties are left to bear their own costs. Prothonotary and Senior Master to communicate this order to the learned Arbitrator. CHIEF JUSTICE