Aparesh Kumar Singh, J. - (1.) Heard learned counsel for the parties.
(2.) Upon consideration of the case of the parties, this Court proposed to appoint Hon'ble Mr. Justice Tapen Sen(Retd.), Former Judge of this Court as arbitrator to adjudicate the dispute between the parties by order dated 27.09.2018, which reads as under:- Petitioner approached this Court invoking Section 11(6) of the Arbitration and Conciliation Act 1996 in Arbitration Application No.05/2017 seeking appointment of an Arbitrator under Clause-38 of the NIT dated 4th July 2012 whereunder the work order was issued in favour of the petitioner, extended by letter dated 28th November 2015 up to 7th December 2016. This Court vide order dated 1st September 2017 after taking note of the stand of the respondents through their counter affidavit was of the view that the application was premature. The petitioner had not taken steps for conciliation as permitted in Clause-37 of the same agreement which is a preceding exercise (Annexure-8). Petitioner submitted himself to the process of conciliation before the respondents thereafter. According to the petitioner, conciliation process did not end up in resolution of the dispute. As such notice for appointment of sole Arbitrator was issued on 23rd April 2018 (Annexure-11) upon the Chief Executive Officer, SAIL, Bokaro Steel Plant. Since the respondents failed to nominate an Arbitrator in terms of the arbitration Clause 38 of the agreement in question, petitioner has been compelled to approach this Court under Section 11(6) of the Arbitration and Conciliation Act 1996 once again for appointment of a sole Arbitrator. Learned counsel for the petitioner submits that meetings were held on 18th December 2017, 11th January 2018 and 9th February 2018 during which claim statement of the petitioner, counter statement from SAIL-BSL and rejoinder from the petitioner were exchanged. More than 45 days thereafter also SAIL did not resolve the dispute and failed to perform its obligation. SAIL did not appear to be interested in settling the dispute amicably through the conciliation process. Counsel for the respondents states on the basis of the instruction contained in the counter affidavit filed by them that three conciliatory meetings were held under the conciliator appointed by the competent authority of SAIL/BSL. He submits that the petitioner has miserably failed to perform its commitment that they have made in the 3rd conciliation meeting held on 9th February 2018. They have not shown the commitment in the conciliation exercise and have approached this Court with unclean hands. Other averments have been made on the merits of the dispute between the parties. Learned counsel for the respondents submits that failure of conciliation was on account of non-cooperation of the petitioner in performing its obligations as per its undertaking. Therefore, prayer for appointment of an Arbitrator is opposed. Considered the submissions of the learned counsel for the parties in the light of the relevant material facts born from record taken note of above. Petitioner was awarded work order dated 8th December 2012 under NIT dated 4th July 2012 for recovery of Ferrous scrap and sale of processed Ferrous scrap (70-150 mm) through magnetic separator for an estimated quantity in tons of approximately 4 lakhs, 3 lakhs and 1 lakh each for different materials as indicated in the NIT at Annexure-1. Work order is Annexure-2 to the application with the following description of the work :- (a) Recovery and processing of Ferrous scrap from the dead BF slag dump sidings for internal supply to SMS/BF. (b) Sale of (i) sale of processed Ferrous scrap (70-150 mm) through magnetic separator, (ii) Recovered and Processed Ferrous scrap of chargeable size (150mm one tonne) and (iii) Recovered Iron slag Boulders. (c) Removal and transportation of work through slag (WTS), output of magnetic separator, 0-10mm magnetic fraction and other waste materials from working site to designated site. (d) Any other jobs as mentioned in the NIT. Work was to be executed within a period of 36 months from the date of issue of the work order or 42 months from the date of issuance of sale order, whichever is earlier as per Clause-4 of the work order. It was extended vide Annexure-3 dated 28th November 2015 up to 7th December 2016 with proportionate increase of schedule of quantities. Work was to be governed as per the scope of work and terms and conditions given in the NIT dated 4th July 2012. NIT contains a structure of dispute resolution mechanism containing Conciliation Clause-37. On failure of conciliation, claims or disputes would be referred by the parties for decision by the sole Arbitrator to be appointed in terms of Clause-38 i.e. the arbitration clause. Clause-37 and 38 are reproduced hereunder :- "37. Conciliation All questions, claims, disputes and or differences of any kind whatsoever arising out of or in connection with or concerning this contract, at any time, whether before or after determination of the contract, shall be referred by the parties hereto for conciliation before a Conciliatory Forum/Body. The Conciliatory Forum/Body will be composed of the following members :- i) Nominee of the Steel Plant/Unit Independent of officer handling the contract. (to be nominated by the head of the concerned department.) ii) Nominee of the Contractor/Customer The parties in dispute would place their facts in writing before the Body/Forum and the process of conciliation would be completed within the period of three months from the date of reference to the Conciliatory Forum/Body. On failure of the conciliation, the aforesaid questions, claims, disputes and or differences shall be referred by the parties here to for the decision by a Sole Arbitrator to be appointed as hereinafter mentioned. 38. Arbitration Matters in question, claims, dispute and or difference in respect of the contract to be submitted to arbitration as aforesaid shall be referred for decision to a Sole Arbitrator to be appointed by MD of Steel Plant/Head of unit, (SAIL). Before appointing the Sole Arbitrator, MD of Steel Plant / Head of unit, (SAIL) shall nominate three names out of which the contractor / customer shall give his consent for one of them for appointment as Sole Arbitrator, failing which after 30 days of the issuance of the letter informing three names MD of Steel Plant/Head of unit, (SAIL) shall have the power to appoint one of the three notified persons as the Sole Arbitrator. In case the designation of the Managing Director of Steel Plant (SAIL) is charged or his office abolished, the officer who for the time being is entrusted with the functions of the Managing Director of Steel Plant (SAIL), by whatever designation such officer is called, shall be the person designated to appoint the Sole Arbitrator. The arbitrator so appointed shall adjudicate upon the disputes between the parties hereto. The Sole Arbitrator appointed as stated above, shall from the time of his appointment and throughout the arbitration proceedings, without any delay, disclose to the parties in writing any circumstances likely to give rise to justifiable doubts as to his independence or impartiality provided that the mere fact that such Sole Arbitrator is an employee of SAIL or its subsidiary shall not be regarded as such circumstances. The arbitrator shall decide the questions, claims, disputes or differences submitted to him by the parties in accordance with the substantive law for the time being in force in India. The arbitrator shall hear the cases independently and impartially and shall not represent the interest of any party. Any arbitrator having personal interest in the case at the time of his appointment and at any time subsequently thereafter must withdraw from his office himself and the parties shall also have the right to ask him to do so. The venue of the arbitration shall be _______ (for domestic tenders, the place where Plant/Unit is located; and for global tenders Delhi). Procedure for conduct of the arbitration proceeding shall be decided by the arbitrator, in consultation with the parties before proceeding with reference. The arbitrator may hold preparatory meeting(s) for this purpose. In the preparatory meeting(s) as aforesaid, the arbitrator/s as the case may be in consultation with the parties shall also determine the manner of taking evidence, the summoning of expert evidence, and all such matters as are necessary for the expeditious disposal of the arbitration proceedings. The provision of the Arbitration and Conciliation Act, 1996 and the rules framed there under, if any and all modifications/amendments thereto shall deem to apply and / or be incorporated in this contract and when such modification / amendments to the Act/Rules are carried out. Work under the contract shall be continued by the contractor/customer, under the contract, during the arbitration proceedings and recourse to arbitration shall not be a bar to continuance for the work unless otherwise directed in writing by the Plant/Unit." Facts of the case reveal that conciliation process did not end up in resolution of the dispute. Thereafter request for appointment of an Arbitrator made by the petitioner has not been responded within the time stipulated. The arbitration clause provides for appointment of sole Arbitrator amongst the names of three Arbitrators to be nominated by the Managing Director of the Steel Plant/Head of unit (SAIL) with consent of the agency. As such, the ingredients to invoke the jurisdiction of this Court under Section 11(6) of the Arbitration and Conciliation Act, 1996 has been satisfied. There is an arbitrable dispute between the parties. As such, this Court proposes to appoint Hon'ble Mr. Justice Tapen Sen (Retd.), Former Judge of this Court, at present residing at ARSH Heights, Block Akash, Flat No.11/D, Near A.G. Office, Doranda, Ranchi having mobile no.9830929728/8340147020 as an Arbitrator to adjudicate the dispute between the parties. The proposed Arbitrator is required to submit a declaration in terms of Section 12 of the Arbitration and Conciliation Act, 1996, as amended. Registry shall communicate the instant order to the proposed Arbitrator for submitting the declaration. Let the case be listed on 25th October 2018 as unfixed case."
(3.) A declaration has been furnished by the proposed Arbitrator, which is at Flag-Y being letter dated 22.10.2018. Learned counsel for the parties submit that the instant dispute can be referred to the proposed Arbitrator for adjudication.;