A.K.SIKRI,J. - (1.) The petitioner, which is a Company incorporated under the laws of Austria, with its registered office in that country, has its branch office in DLF City, Gurgaon, Phase-II, India as well. It is engaged, inter alia, in the business of steel production with the use of advance technology, like Rolling Technology and Heat Treatment Technology, as well as manufacturing, producing and supplying rails and related products. It claims to be a European market leader and innovation pioneer with a worldwide reputation which has played a decisive role in the development of modern railway rails. The respondent, Delhi Metro Rail Corporation Ltd. (DMRC) awarded the contract dated 12th August, 2013 to the petitioner for supply of rails. Certain disputes have arisen between the parties with regard to the said contract inasmuch as the petitioner feels that respondent has wrongfully withheld a sum of euro 5,31,276/- (Euro Five Lakhs Thirty One Thousand Two Hundred and Seventy Six only) towards invoices raised for supply of last lot of 3000 MT of rails and has also illegally encashed performance bank guarantees amounting to EURO 7,83,200/- (Euro Seven Lakhs Eighty Three Thousand Two Hundred only). Respondent has also imposed liquidated damages amounting to EURO 4,00,129.397/- (Euro Four Hundred Thousand One Hundred Twenty Nine and Cent Three Hundred Ninety Seven Only) and invoked price variation clause to claim a deposit of EURO 4,87,830/- (Euro Four Lakhs Eighty Seven Thousand Eight Hundred Thirty). Not satisfied with the performance of the petitioner, the respondent has suspended the business dealings with the petitioner for the period of six months. The petitioner feels aggrieved by all the aforesaid actions and wants its claims to be adjudicated upon by an Arbitral Tribunal, having regard to the arbitration agreement between the parties as contained in Clause 9.2 of General Conditions of Contract (GCC) read with Clause 9.2 of Special Conditions of Contract (SCC).
(2.) It may be pointed out, at the outset, that arbitration agreement between the parties, as contained in the aforesaid clause of the contract is not in dispute. It may also be pointed out that Clause 9.2(A) of the SCC prescribes a particular procedure for constitution of the Arbitral Tribunal which, inter alia, stipulates that the respondent shall forward names of five persons from the panel maintained by the respondent and the petitioner will have to choose his nominee arbitrator from the said panel. As per the events mentioned in detail hereinafter, the respondent had, in fact, furnished the names of five such persons to the petitioner with a request to nominate its arbitrator from the said panel. However, it is not acceptable to the petitioner as the petitioner feels that the panel prepared by the respondent consists of serving or retired engineers either of respondent or of Government Department or Public Sector Undertakings who do not qualify as independent arbitrators. According to the petitioner, with the amendment of Section 12 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the 'Act') such a panel, by Amendment Act, 2015, as prepared by the respondent, has lost its validity, as it is contrary to the amended provisions of Section 12 of the Act. For this reason, the petitioner has preferred the instant petition under Section 11(6) read with Section 11(8) of the Act for appointment of sole arbitrator/arbitral tribunal under Clause 9.2 of GCC read with Clause 9.2 of SCC of the Contract dated August 12, 2013.
(3.) With the aforesaid preliminary introduction reflecting the nature of these proceedings, we may take note of the relevant and material facts in some detail. Around January, 2013, the respondent had floated a tender for the procurement of 8000 Metric Tons (MT) "Head Hardened Rails of certain specifications for Delhi Metro, Phase-III projects and invited bids from the eligible bidders. The petitioner was one such bidder whose bid was ultimately accepted after tender evaluation process undertaken by the respondent. It resulted in the signing of contract agreement dated August 12, 2013 between the parties for the supply of the aforesaid material. As per the petitioner, it has duly delivered the rails in three lots of 3000MT, 3000MT and 2000MT rails on January 13, 2014, January 19, 2014 and August 03, 2014 respectively at sea port at Mumbai, which delivery, according to the petitioner, was well within the agreed time limits. However, after the delivery of the aforesaid rails at Mumbai, inland transport thereof from Mumbai to Respondent's depots at Delhi was delayed due to various reasons. As per the petitioner, these reasons are not attributed to it and it cannot be faulted for the same. However, the respondent treated it as default on the part of the petitioner and imposed liquidated damages vide its letter dated September 21, 2015. The respondent also called upon the petitioner to submit its final bill so that the liquidated damages could be set off against the said bill. This was the starting point of dispute between the parties, as the petitioner refuted the allegations of the respondent and questioned the imposition of liquidated damages as well as calculations thereof. Correspondence ensued and exchanged between the parties but it may not be necessary to state the same in detail here as that would be the subject matter of adjudication before the arbitral tribunal. Suffice it to state that respondents also encashed the bank guarantee and raised claims against the petitioner as balance amount due from the petitioner. On the other hand, the petitioner states that it is the respondent which has to pay substantial amounts to the petitioner and a glimpse of the claims of the petitioner has already been indicated above.;