- (1.) This original petition has been filed under Section 11 of the Arbitration and Conciliation Act 1996 (hereinafter referred to as 'the Act') for appointment of Arbitrator in furtherance of Clause 20 of the Letter of Intent ( in short 'LOI') dated 10.03.2011 to adjudicate upon the dispute/differences between the petitioner and the respondent.
(2.) The necessary facts, which are required to be noticed for the disposal of this original petition, are as follows: That the petitioner is a registered company incorporated and registered under the provisions of the Companies Act, 1956. It carries the business of erection of electrical installations, providing technical know-how and implementing electrical projects and supply of equipment. 2.1. The respondent is also a Company registered under the Companies Act, 1956 and it is carrying on business in Civil and Engineering activities. The petitioner and the respondent Companies entered into an agreement to undertake a work for supply, installation and commissioning of electrical work at All India Institute of Medical Sciences (AIIMS) at Jodhpur, Rajasthan. Accordingly, a Letter of Intent (LOI) dated 10.03.2011 has been issued by the respondent, which is otherwise called as "agreement or contract"? between the parties and for the purpose of this original petition, this shall be called as "arbitration agreement". 2.2. According to the LOI, the total value of the project was Rs.10,72,05,548/-. As per the terms of contract work had been commenced in 2011 and was over by February 2017. During the work period, periodically running bills were raised by the petitioner and bill No.1 was raised accordingly, on 03.08.2011 and bill No.34 was raised on 20.10.2016. 2.3. The petitioner claimed to have submitted bills to the tune of Rs.8,57,01,421/- plus Rs.8,50,000/- by way of deviation amount, out of the said bills, a total amount of Rs.7,26,00,000 was paid. 2.4. Thereafter some more bills have also been made by the petitioner and part of the amount for the said bills also have been paid by the respondent. According to the petitioner, there has been a due for a sum of Rs.1,58,84,651/-, since the last payment of Rs.2 lakhs was made on 16.11.2016 and as per the LOI, work was carried out and it was closed only by letter dated 18.04.2017, the remaining outstanding, as set out above was due according to the petitioner, payable by the respondent. 2.5. Since the said outstanding amount, according to the petitioner, has not been paid by the respondent, in order to recover the said amount, the petitioner initially filed a civil suit in CS(COMM) 601 of 2017 before the High Court of Delhi. However, the Delhi High Court, by taking into account the arbitration clause contained in the LOI, vide its order, dated 14.11.2017, dismissed the said suit with liberty to the parties to refer the matter to the arbitration proceedings. 2.6. Consequent upon the said order passed by the Delhi High Court, dated 14.11.2017, the petitioner has claimed to have sent a notice on 18.11.2017, invoking Section 11 of the Act by suggesting two sole arbitrators to be considered for appointment to resolve the disputes between the parties and required the respondent to give its consent for such appointment of the sole arbitrator among the two names suggested by the petitioner. 2.7. In this context, it is the case of the petitioner that, the said notice dated 18.11.2017 issued under Section 11 invoking the arbitration clause under the Act, though has been addressed to the correct address of the respondent Company at New Delhi, it has been returned. Thus, the petitioner claimed that, purposefully in order to evade the receipt of such notice under Section 11 of the arbitration Act, the respondent has not received the same. 2.8. It is the further case of the petitioner that, since the said notice dated 18.11.2017 has been returned unserved, the petitioner, through his lawyer, had sent an e-mail communication on 28.11.2017 to the e-mail address of the respondent, which, the respondent received. And on the same date, hard copy of the notice had also been sent to the respondent by post to the registered office of the respondent at Mumbai address, which has been delivered on 29.11.2017 and a delivery report also has been received by the petitioner to that effect. In this context, it is the further case of the petitioner that, the respondent, having receipt of notice under Section 11 of the Act dated 28.11.2017, both by way of e-mail as well as through post, have not acted upon either by approving the arbitrators' name suggested by the petitioner or responding to the said notice within 30 days period as contemplated under Section 11 of the Act. Thus, the said inaction of the respondent, according to the petitioner, triggered the petitioner to invoke Section 11 of the Act to approach the High Court of Delhi, where, according to the petitioner, the execution of the subject contract had been taken place and accordingly, an arbitration petition under Section 11 of the Act was filed by the petitioner before the Delhi High Court. It is the further case of the petitioner that, the Delhi High Court, in the said arbitration original petition No.9/2018, issued notice to the respondent and when the original petition came up for hearing on 09.01.2018 before the Delhi High Court, the respondent entered appearance through his counsel and he sought for time to file reply to the original petition filed by the petitioner. Thereafter, a communication purported to have been dated 20.12.2017, was issued only on 11.01.2018 to the petitioner by the respondent stating as if that on 20.12.2017, the respondent has appointed a sole arbitrator. The said communication dated 20.12.2017 despatched on 11.01.2018 is a fabricated document making an ante-date and therefore, in this regard, in order to take criminal action against the authorised signatory, who claimed to have sent the document, dated 20.12.2017, the petitioner, accordingly, filed a criminal miscellaneous application in Crl.M.A.No.3501/2018 in the said arbitration petition No.9/2018 under Section 340 of the Code of Criminal Procedure. 2.9. It is also the case of the petitioner that, on receipt of the said petition, the Delhi High Court has directed the respondent to file the relevant records to show that how the despatch records are being maintained at the office of the respondent and in this regard, the Delhi High Court also directed one Mr.L.Ramakrishnan, who signed the said letter dated 20.12.2017 to appear before the Delhi High Court on 03.04.2018. However, on 03.04.2018, when the arbitration original petition along with the said criminal Miscellaneous Application came up for hearing, it was submitted on behalf of the respondent that, since clause 20 of the arbitration agreement ie., LOI dated 10.03.2011, makes it clear that the place of arbitration shall be at Chennai and the jurisdiction Court is only at Chennai, the said original petition 9/2018 ought not to have been entertained by the Delhi High Court, since it does not confer the jurisdiction. Having accepted the said plea raised by the respondent, the Delhi High Court on 03.04.2018 passed an order directing the petitioner to approach the jurisdictional Court ie., at Chennai and accordingly, the said original petition was dismissed. By dismissing the arbitration original petition in the said order dated 03.04.2018, the Delhi High Court had observed that, the issues raised in the original petition can be raised before the jurisdictional Court by the petitioner and the respondent. 2.10. Pursuant to the said order passed by the Delhi High Court, the petitioner has filed the present original petition under Section 11 of the Act with the aforesaid prayer for appointment of a sole arbitrator as prayed therein. That is how, the present original petition has been filed before this Court.
(3.) The respondent, on notice, entered appearance and filed counter affidavit, where, inter-alia, the averments made in the petition by the petitioner have been generally denied and insofar as the specific denial on the averments are concerned, it is the case of the respondent that, the respondent has not purposely evaded any letter/notice issued by the petitioner dated 18.11.2017. The respondent averred that, they received the e-mail dated 28.11.2017, which was the only communication received by the respondent and the same was promptly acted upon by the respondent by sending a letter to the petitioner informing that the respondent appointed one Mr.K.D.Arcot to be the sole arbitrator to arbitrate the disputes arising under the LOI.;