ASHISH TRANSPORT COMPANY LTD. Vs. MAHANADI COALFIELDS LIMITED

JUDGEMENT

(1.) THIS application for appointment of an Arbitrator was filed by the petitioner on 18.2.2003 before this Court. The petitioner entered into an agreement dated 13.10.1992 with the opposite parties and the petitioner was appointed transport contractor. Such contract was to continue for five years commencing from 6.12.1991 and ending in December, 1996. Under the said contract the petitioner was entrusted with the job of transportation of coal. The case of the petitioner is that on expiry of the aforesaid period of contract, the opposite parties engaged the petitioner for a further period of five years from 6.12.1996 to 5.10.2001 and with consent of the petitioner the period of contract was extended. According to the petitioner, the extension is nothing but a continuation of the previous contract. As dispute arose between the parties, the petitioner repeatedly brought to the notice of the opposite parties about its dues, but the opposite parties did not clear the alleged dues of the petitioner. Several committees were set up by the opposite parties to look into the matter and accordingly, the committees recommended payment in favour of the petitioner but the payment has not been cleared. Several demands made by the petitioner have also been disclosed in the petition. As the petitioners dues were not paid, the petitioner ultimately was compelled to invoke the arbitration clause in the contract and notice was given to the opposite parties on 11.8.2002 and as no arbitrator was appointed within thirty days, this petition was filed in this Court on 18.2.2003 under Section 11 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as 'the Act) for appointment of an Arbitrator.

(2.) IN the counter affidavit which has been filed by the opposite parties the stand is that the agreement dated 10.1.1998 does not contain any arbitration clause. It was also contended that after completion of the previous agreement the petitioner entered into a fresh agreement for transportation of coal on 10.1.1998 with effect from 6.12.1996 to 5.12.2001 vide Annexure -2. It was also stated that the petitioner asked for arbitration by its letter dated 11.8.2002 which is seven years after the expiry of the previous agreement. In the counter it has been stated in paragraph 10 that the petitioner has exhausted the dispute settlement machinery set up under Clause 29 of the second agreement dated 10.1.1998. It has been reiterated that since the agreement does not contain any arbitration clause the provision of Section 11 of the said Act is not attracted and the petition for appointment Arbitrator has to be rejected.

(3.) UNDER those General Terms and Conditions Clause 36 is the arbitration Clause which has been set out above. It also appears from various correspondence between the parties that the subsequent agreement is nothing but an extension of the previous agreement. Reference in this connection may be made to the letter of the opposite parties dated 12.1.1998 written by CME (Prodn.)/SO (Mining), Kalinga Area of opposite party No. 1 to its Project officer. Similar letters have been disclosed in the petition, particularly letter dated 15.7.1997 which is sent by the Chief General Manager (CMS) of the opposite party No. 1 wherein the approval of the competent authority for extension of contract for a further period of five years from 6.12.1996 to 5.12.2001 was recorded. The said approval order is as follows :