RASTOGI, J. - (1.) THE present writ petition has been filed by the petitioner against the order of the learned Single Judge dated 15. 1. 2004 (Ex. 10) whereby the arbitration application No. 79/2002 preferred by him under section 11 of the Arbitration & Conciliation Act, 1996 (Hereinafter to be referred in short as `the Act of 1996') was dismissed.
(2.) THE legislative intent underlying the Act of 1996, is to minimise the supervisory role of the courts in the arbitral process and nominate/appoint the arbitrator without wasting time, leaving all contentious issues to be urged and agitated before the Arbitral Tribunal itself. Even under the old law, common sense approach alone was commended for being adopted in construing an arbitration clause more to perpetuate the intention of parties to get their disputes resolved through the alternate disputes redressal method of arbitration. Brief facts of the case are that the petitioner is a sole proprietorship firm and is involved in constructions business. A contract was awarded by the Executive Engineer, Public Works Department, Div. I, Bharatpur in favour of the petitioner vide letter dated 30. 3. 1998 and the agreement was accordingly executed. As per the terms of the agreement stipulated date of commencement was 14. 4. 1998 and the date of completion was 13. 2. 1999 and according to the terms of the agreement the valuation of the contract was Rs. 19,82,537. 54/ -. Time was essence of the contract and accordingly the petitioner arranged labour, staff, machinery etc. which were required for the work but the reciprocal promises which were to be undertaken by the respondents were not fulfilled. Therefore, the petitioner sent letters/representations. Copies of few have been placed on record as Ex. 1,2 and 3 respectively. Since the petitioner was prevented to perform his part of the contract solely because the respondents failed to perform their obligation as per the terms of the contract and when no action was taken on the representation the registered A. D. notice was sent by the petitioner dated 22. 8. 2002 and demanded that as per clause 23 of the agreement the matter be referred to the Arbitration and alongwith the same enclosed a cheque amounting to Rs. 41,634. This letter dated 22. 8. 2002 (Ex. 4) was sent through registered A. D. Post and it was received in the office of the respondents on 26. 8. 2002 (Ex. 11 ). After expiry of 30 days as provided under clause 23 of the agreement the petitioner sent a telegram dated 26. 9. 2002 (Ex. 6) holding that since the respondents have failed to appoint the Arbitration Committee under clauses 23 within a period of 30 days, their right to appoint Arbitration Committee stood forfeited and advised the bankers to stop the payment of the amount of the cheque which was enclosed by the petitioner alongwith the notice dated 22. 8. 2002 (Ex. 4), which has been placed on record. Clause 23 of the said agreement is reproduced hereinbelow:- " 23. If any question, difference or objection whatsoever shall, arise in any way in connection with or arising out of this instrument or the meaning of operation of any part thereof or the rights, duties or liabilities of either party, then save in so far as the decision of any such matter as herein before provided for and been so decided, every such matter constituting a total claim of Rs. 50,000/- or above, whether its decision has been otherwise provided for and whether it has been finally decided accordingly, or whether the contract should be terminated or has been rightly terminated and as regards the rights or obligations of the parties as the result of such termination shall be referred for decision to the empowered standing committee which would consist of the following :- (i) Administrative Secretary concerned. (ii) Finance Secretary or his nominee not below the rank of Deputy Secretary. (iii) Law Secretary or his nominee not below the rank of Joint L. R. (iv) Chief Engineer cum Addl. Secretary of the concerned department. (v) Chief Engineer concerned (member Secretary ). The Engineer Incharge on receipt of application along prescribed fee (the fee would be two percent of the amount in dispute not exceeding Rs. one lakh) from the contractor shall refer the disputes to the Committee within a period of one month from the date or receipt of application. " Undisputedly there is a dispute between the parties and in the aforesaid circumstances application was moved under section 11 of the Act of 1996 before this court by the respondents for appointment of an Arbitrator. Reply to the application aforestated was filed by the Respondent-State of Rajasthan before the learned Single Judge. In para 2 of the reply it was not disputed that the application dated 22. 8. 2002 was received by the respondents in their office. The registered A. D. receipt on which there is a signature of the person who has received the notice dated 22. 8. 2002 made it clear it was received on 26. 8. 2002. But the concerning clerk in the office of the respondent State processed the notice dated 22. 8. 2002 for further action in their office and made its entry in the dispatch receipt register on 28. 8. 2002. Reference may have to Annex. R/1. The period of 30 days as stipulated under clause 23 of the agreement was computed by the respondents w. e. f. 28. 8. 2002. However, the fact remained undisputed that registered notice was received on 26. 8. 2002. The learned Single Judge rejected the arbitration application No. 79/2002 filed by the petitioner vide its order dated 15. 1. 2004 which has been challenged by the petitioner by this writ petition under Articles 226 and 227 of the Constitution of India.
(3.) SHRI R. C. Joshi, counsel for the petitioner contended that once the notice dated 22. 8. 2002 alongwith which a cheque of Rs. 41,634/- enclosed (Ex. 4) was sent through registered A. D. post and was duly received in the office of respondent State by Ex. 11 on 26. 8. 2002 and no communication was received within 30 days from the date of receipt thereof from the office of respondent State thus w. e. f. 26. 9. 2002, the respondents have forfeited their right to refer the matter to the Arbitration Committee under clause 23 of the agreement. The finding of the fact recorded by the learned Single Judge that the cheque was submitted by the petitioner on 28. 8. 2002 is not correct. In support of his contention SHRI Joshi placed reliance on a decision of this court in M/s. Singhal Construction Company, Bharatpur vs. State of Rajasthan (1), submitted that once the respondent has failed to discharge its obligation within a stipulated period of 30 days from the date of receipt of the notice as provided under clause 23 of the agreement, their right to refer the matter to the Arbitrator provided under the agreement stand forfeited. As such the Arbitrator is required to be appointed under section 11 of the Act of 1996. The respondent counsel Shri J. K. Agarwal on the other hand without disputing the factual position has submitted that even if the respondent State has failed to take its decision within 30 days from the date of receipt of the notice, still their right to make appointment of Arbitrator in terms of clause 23 of the agreement, cannot automatically be forfeited and in support of his contention counsel Shri J. K. Agarwal placed reliance on a decision of Hon'ble Supreme Court in Datar Switchgears Ltd. vs. Tata Finance Ltd. In the aforesaid came under clause 20. 9 of the lease agreement no notice period was provided in the above arbitration clause and it gives unbridled discretion to the lessor in appointing Arbitrator. After the notice was served for making payment and before filing of the application under section 11 of the Act of 1996, Arbitrator was appointed under clause 20. 9 of the lease agreement. As such the question which came before the Hon'ble Supreme Court for consideration was as to whether the case falling under section 11 (6) of the Act of 1996, can the lessor appoint an Arbitrator after the expiry of 30 days from the date of demand. Undisputedly there was no failure of the procedure by the lessor as prescribed under the agreement. ;