GOVIND MATHUR, J. - (1.) THE applicant is proprietor of M/s R.K.Filling Center and is having retail outlet for sale of Motor Spirit (MS) and High Speed Diesel (HSD) under the dealership granted by the Hindustan Petroleum Corporation Limited. A memorandum of agreement dated 5.12.2005 was executed between the parties for the purpose. Clause 66 of the agreement aforesaid provides for arbitral proceedings to resolve any sort of dispute arising between the Hindustan Petroleum Corporation Limited and the applicant dealer. Clause 66 aforesaid reads as under: - "66. ANY DISPUTE OR DIFFERENCE OF ANY NATURE WHATSOEVER OR REGARDING ANY RIGHT, LIABILITY, ACT, OMISSION OR ACCOUNT OF ANY OF THE PARTIES HERETO ARISING OUT OF OR IN RELATION TO THIS AGREEMENT SHALL BE REFERRED TO THE SOLE ARBITRATION OF THE MANAGING DIRECTOR OF THE CORPORATION OR OF SOME OFFICER OF THE CORPORATION WHO MAY BE NOMINATED BY THE MANAGING DIRECTOR. THE DEALER WILL BE ENTITLED TO RAISE ANY OBJECTION TO ANY SUCH ARBITRATOR ON THE GROUND THAT THE ARBITRATOR IS AN OFFICER OF THE CORPORATION OR THAT HE HAS TO DEAL WITH THE MATTERS TO WHICH THE CONTRACT RELATES OR THAT IN THE COURSE OF HIS DUTIES AS AN OFFICER OF THE CORPORATION HE HAD EXPRESSED VIEWS ON ALL OR ANY OF THE MATTERS IN DISPUTE OR DIFFERENCE, IN THE EVENT OF THE ARBITRATOR TO WHOM THE MATTER IS ORIGINALLY REFERRED BEING TRANSFERRED OR VACATING HIS OFFICE OR BEING UNABLE TO ACT FOR ANY REASON THE MANAGING DIRECTOR AS AFORESAID AT THE TIME OF SUCH TRANSFER, VACATION OF OFFICE OR INABILITY TO ACT, SHALL DESIGNATE ANOTHER PERSON TO ACT AS ARBITRATOR IN ACCORDANCE WITH THE TERMS OF THE AGREEMENT SUCH PERSON SHALL BE ENTITLED TO PROCEED WITH THE REFERENCE FROM THE POINT AT WHICH IT WAS LEFT BY HIS PREDECESSOR, IT IS ALSO A TERM OF THIS CONTRACT THAT NO PERSON OTHER THAN THE MANAGING DIRECTOR OR A PERSON NOMINATED BY SUCH MANAGING DIRECTOR OF THE CORPORATION AS AFORESAID ACT AS ARBITRATOR HEREUNDER. THE AWARD OF THE ARBITRATOR SO APPOINTED SHALL BE FINAL, CONCLUSIVE AND BINDING ON ALL PARTIES TO THE AGREEMENT, SUBJECT TO THE PROVISION OF THE ARBITRATION ACT, 1940 OR ANY STATUTORY MODIFICATION OF OR RE -ENACTMENT THEREOF AND THE RULES MADE THEREUNDER AND FOR THE TIME BEING IN FORCE SHALL APPLY TO THE ARBITRATION PROCEEDINGS UNDER THE CLAUSE."
(2.) THE Senior Retail Sales Manager, Jodhpur Region of the Hindustan Petroleum Corporation Limited by an order dated 5.2.2010 terminated the agreement, thus, the applicant under a notice dated 16.2.2010 requested the respondents to invoke clause 66 of the arbitration agreement to adjudicate the dispute relating to termination effected under the letter dated 5.2.2010. After receiving the notice dated 16.2.2010 no arbitrator was appointed but under letter dated 5.3.2010 the Senior Regional Manager, Hindustan Petroleum Corporation Limited, Jodhpur Region conveyed to the applicant that a decision was taken by the Hindustan Petroleum Corporation Limited to change the arbitration clause existing to extend freedom to the appointing authority to appoint a retired officer of the corporation also as sole arbitrator. The applicant was advised to given his consent latest by 9.3.2010. The applicant in his turn conveyed to the respondents that he desires to get appointed some independent person as arbitrator. He also proposed names of certain persons to be appointed as arbitrator. No action thereon was taken, thus, this application was presented on 22.3.2010. A reply to the application has been filed on behalf of the Hindustan Petroleum Corporation Limited and its officers with assertion that by an order dated 30.3.2010 Shri Deepak Hota, General Manager, MRA and P, has already been appointed as arbitrator to adjudicate the dispute and differences between the parties, thus, the application has become infructuous. An affidavit dated 18.1.2014 sworn -in by Shri Sanjay Malhotra, Chief Regional Manager, Hindustan Petroleum Corporation Limited (Retail), Bhagat Ki Kothi, Jodhpur, has also been filed with a statement that earlier Shri Deepak Hota was appointed as sole arbitrator but on being appointed as Director -HR, M/s Bharat Earth Movers Limited, he submitted his resignation from Hindustan Petroleum Corporation Limited and also demitted the charge of arbitrator. Consequently, Shri Parvinder Singh, Deputy General Manager, Operation and Distribution, North Zone, Hindustan Petroleum Corporation Limited has been appointed as arbitrator by the Managing Director of the Hindustan Petroleum Corporation Limited under an order dated 7.8.2013. It is asserted by counsel for the respondents that in view of appointment of the arbitrator and participation of the applicant in arbitration proceedings, this application has become infructuous. It is also submitted on behalf of the respondents that the notice given by the applicant is not in terms of clause 66 of the agreement, therefore, the same is absolutely non -consequential.
(3.) ON the other hand the stand of the applicant is that after lapse of 30 days from the date of giving notice for appointment of arbitrator by invoking clause 66 of the agreement, the appointing authority forfeited its right for appointment of arbitrator, thus, the appointment of Mr. Hota as arbitrator was without jurisdiction. It is further submitted that the applicant has not participated actively in the arbitral proceedings. With regard to other submission of the respondents, it is submitted that the applicant in its notice in quite specific terms made a request to invoke arbitral proceedings as per clause 66, therefore, the notice is in accordance with the requirements of the agreement and also in consonance with provisions of Section 11 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as "the Act of 1996").;