MOUSHUMI BHATTACHARYA,J. - (1.) The Award under challenge in this application under section 34 of The Arbitration and Conciliation Act, 1996 is of 21st January, 2009. By the impugned Award, the petitioner has been directed to pay to the respondent/claimant Rs. 31,29,060/- (Rs. 7,00,000/- + Rs. 10,85,000/- + Rs. 13,44,060/-) with 15% simple interest on and from 06.08.2004 till actual realisation within 45 days from the date of receipt of a signed copy of the Award, along with a sum of Rs. 2,17,000/- towards the cost of arbitration proceedings. The award is based on a finding that the petitioner was contractually obligated to repay an amount of Rs 7 lakhs to the respondent in terms of Clause 28A of an Agreement entered into between the petitioner and the respondent. The said agreement dated 24th January, 1995 was for supply of the petitioner's goods to the respondent as the Special Stockist is accordance with certain clauses which form the basis of the rights and obligations claimed by the parties herein.
(2.) The first point taken by Mr. Tapas Kumar Dey, learned counsel appearing for the petitioner is that the arbitration proceeding has not been properly invoked as a result of which the impugned award is required to be set aside. Counsel disputes the manner of invocation of the arbitration through the letter of the respondent dated 2nd July 2004 on the ground that the said letter gave the petitioner only 15 days to act in terms thereof. According to counsel, under section 11 (5) of The Arbitration and Conciliation Act, 1996 (the Act) the parties are given 30 days to agree to the appointment of a sole arbitrator, whereas in this case the period mentioned in the letter of 2nd July 2004 is 15 days. Counsel relies on a decision of a learned Judge of this court in Deepak Gidra Vs. Dr. PB's Health and Glow Clinic Private Limited on the procedure for appointment of arbitrators under section 11 of the 1996 Act. The second ground of challenge to the impugned award is that it suffers from perversity. According to counsel, the Arbitrator despite holding that the respondent could not prove her case, proceeded to award compensation for an amount of Rs. 33,46,060/- (Rs.31,29,060/- + Rs.2,17,000/-) to the respondent. Union of India Vs. Ajabul Biswas reported in 2008 (1) CHN 16 is relied on in relation as to what would be the marker for perversity.
(3.) The next point is that the claim of the respondent/claimant before the arbitrator was barred by limitation. The factual context to this is that there were no dealings between the parties from February 1997 and hence the respondent's demand notice of July 2004 after eight years is time-barred. Counsel submits that the respondent/stockist did not take any steps pursuant to the agreement resulting in the petitioner suffering monetary loss and that the petitioner was constrained to discontinue the arrangement with the respondent stockist which was duly communicated to the respondent.;