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H a $-4 HIGH COURT OF DELHI
ARB.P.392/2012
MUKTI CREDITS PVT LTD Petitioner
Through Mr.Prashant Mehta,Adv. with Mi'.Himanshu Kapoor and Ms.Priya
Pathania, Advs.
H a $-4 HIGH COURT OF DELHI
ARB.P.392/2012
MUKTI CREDITS PVT LTD Petitioner
Through Mr.Prashant Mehta,Adv. with Mi'.Himanshu Kapoor and Ms.Priya
Pathania, Advs.
VERSUS
INDRAPRASTHA POWER GENERATION CO LTD Respondent
Through Mr.Sanjay Poddai;Sr. Adv. with Mr.A.S. Datar, Adv.
Through Mr.Sanjay Poddai;Sr. Adv. with Mr.A.S. Datar, Adv.
CORAM:
HON'BLE MR.JUSTICE MANMOHAN SINGH
22.03.2013
22.03.2013
ARB.P.392/2012& LA.No.179/2013 ffor stay ofproceedings!
The present petition has been filed by the petitioner under Section 11 of the Arbiti-ation and Conciliation Act, 1996 for appointment of an
Arbitrator.
The case ofthe petitioner is a tender was floated on 30^'' September, 2010 by the respondent inviting bids for dismantling and disposal of4 units of coal based power plant being unit 2-5. Participating bidders had to deposit a sum of ?4 crores as earnest money, which if the party was successful was to be held for the period of completion of works and thereafter returned/refunded. The petitioner submitted a Demand Draft bearing No.299111 dated 25^''October,2010for^4 crores as eaiuest money.
Petitioner's representatives had met with the representatives ofrespondent
2013:DHC:8056 and no disclosures as such were made by any ofthe representatives ofthe respondent in respect of the disputes raised by the purchaser of Unit 1 claiming ownership over parts ofUnits 2-5. It is stated that on 25^'October, 2010 itself, one Ajmera Steels Pvt. Ltd. had filed a petition under Section 9 ofthe Ai'bitiation and Conciliation Act, 1996, being OMP No.632/2010 and this Courtissued notice in the said petition. The respondent deliberately did not disclose the pending litigation to the petitioner. Without any knowledge ofthe pending disputes,the petitioner participated in the e-auction and came out as the highest bidder offering a sum of?101,51,11,110/- for the plant.
It stated that despite repeated attempts,the respondent failed to handover the possession. It was finally only on 25^''January,2011 that respondent issued a delivery order against which actual physical possession of the first unit
(Unit2)was handed over to the petitioner.
Soon after having received the Delivery Order on 12"^ Febrnary,2011, the petitioner deposited the second installment so as to be permitted to commence lifting the material apart from the dismantling activities which had only then commenced recently due to delay on the part of the respondent. Though there were delays, the petitioner still paid third installment on 27''^ May,2011 along with alleged purported penalty without prejudice to all ofpetitioner's rights in relation thereto. By letter dated 23"*
August, 2011, the petitioner explained to the respondent that by reason of various delays and force rnajeure circumstances such as heavy rain during
July-August, 2010, 15"^ August secmity concerns etc. petitioner needed additional two weeks for payment offourth instalment but no avail. Due to respondent's stand that petition would not be allowed to continue with the work, on 15"' September, 2011,the petitioner paid fourth instalment but at that time refused to pay any alleged penalty due to delays attiibutable to respondent. As the respondent insisted on recovering penalty for delay in payment,the petitioner was left with no altemative had to deposit penalty of
?86.97,876,94 on a without prejudice basis.
It is further stated in the petition that on or about 20"^ May,2011 this
Comt had passed an order of injunction restraining respondent from alienating 12 critical items over which the petitioner had the right. The petitioner came to know nearly one year" i.e. on 17^'^ April, 2012 after the order had been passed.
The petitioner partly deposited the fifth instalment on or about 12"'
Febmaiy,2012 and deposited full iristalments by 28"' Febmaiy,2012. By letter dated 18"'April,2012the petitioner pointed outvarious obsfructions to their various dismantling and lifting activities including the fact that the work on various items had been stopped due to the stay order. Thereafter there were various corTcspondences between the parties. As the disputes arose between the parties, the petitioner had filed a petition under Section 9 of the Arbitration and Conciliation Act, 1996, being O.M.P. No.757/2012 which was disposed ofon 24"'September,2012. The petitioner served the said order along with letter dated 25"' September, 2012 asking for tJre possession ofthe site. The respondent by letter dated 27"'September,2012 stated that the petitioner had not complied with the terms ofthe said order and informed that until the petitioner deposits the amount of VAT to the tune of^5,07,55,560/- the respondent will not do the needful.
It is stated in the petition thatthere can be no question ofpenalty. On the contr^ary, the petitioner is entitled to recover interest on the amounts of fourth and fifth installments in particular- which were paid much before they were due.
It is stated in the petition that the petitioner invoked the arbitration clause of the Delivery Order by notice dated ll'*^ September, 2012. The respondent failed to appoint the Arbitrator within the stipulated period of time. Therefore,the present petition has been filed.
The respondentappointed Sh.S.S. Chaudhary,asthe sole Arbitratorto adjudicate the disputes between the parties. Leairred counsel for the petitioner states that the said appointment made by the respondent is contraiy to the law. Therefore,the petitioner is insisting to the prayer made in the application. After some submissions made by the learned counsel for the parties, learned counsel for the respondent has no objection if an independent sole Arbitrator be appointed by this Court to adjudicate the disputes between the parties. He has also suggested few names on behalfof the respondent. In view thereof. Justice R.C. Chopra (Retd. Judge of this
Court) (Mobile No.9818097777/9971411226) is appointed as a sole
Arbitrator to adjudicate the disputes between the parties to be conducted under the aegis ofDelhi High Court Arbitration Centr-e! The fee shall be paid to the sole Arbihator as per rules maintained by Delhi High Court
Arbitration Centre. The petition stands disposed of.
A copy of this order be cormnrmicated to the learrred Arbitrator as well as the Secretary to the Arbitation Centre forthwith. Copies ofthe same be also given dasti to the learrred counselfor the parties.
Trvv^v cj. \r\ I MANMOHAN SINGH,J. ' MARCH 22,2013/jk
The present petition has been filed by the petitioner under Section 11 of the Arbiti-ation and Conciliation Act, 1996 for appointment of an
Arbitrator.
The case ofthe petitioner is a tender was floated on 30^'' September, 2010 by the respondent inviting bids for dismantling and disposal of4 units of coal based power plant being unit 2-5. Participating bidders had to deposit a sum of ?4 crores as earnest money, which if the party was successful was to be held for the period of completion of works and thereafter returned/refunded. The petitioner submitted a Demand Draft bearing No.299111 dated 25^''October,2010for^4 crores as eaiuest money.
Petitioner's representatives had met with the representatives ofrespondent
2013:DHC:8056 and no disclosures as such were made by any ofthe representatives ofthe respondent in respect of the disputes raised by the purchaser of Unit 1 claiming ownership over parts ofUnits 2-5. It is stated that on 25^'October, 2010 itself, one Ajmera Steels Pvt. Ltd. had filed a petition under Section 9 ofthe Ai'bitiation and Conciliation Act, 1996, being OMP No.632/2010 and this Courtissued notice in the said petition. The respondent deliberately did not disclose the pending litigation to the petitioner. Without any knowledge ofthe pending disputes,the petitioner participated in the e-auction and came out as the highest bidder offering a sum of?101,51,11,110/- for the plant.
It stated that despite repeated attempts,the respondent failed to handover the possession. It was finally only on 25^''January,2011 that respondent issued a delivery order against which actual physical possession of the first unit
(Unit2)was handed over to the petitioner.
Soon after having received the Delivery Order on 12"^ Febrnary,2011, the petitioner deposited the second installment so as to be permitted to commence lifting the material apart from the dismantling activities which had only then commenced recently due to delay on the part of the respondent. Though there were delays, the petitioner still paid third installment on 27''^ May,2011 along with alleged purported penalty without prejudice to all ofpetitioner's rights in relation thereto. By letter dated 23"*
August, 2011, the petitioner explained to the respondent that by reason of various delays and force rnajeure circumstances such as heavy rain during
July-August, 2010, 15"^ August secmity concerns etc. petitioner needed additional two weeks for payment offourth instalment but no avail. Due to respondent's stand that petition would not be allowed to continue with the work, on 15"' September, 2011,the petitioner paid fourth instalment but at that time refused to pay any alleged penalty due to delays attiibutable to respondent. As the respondent insisted on recovering penalty for delay in payment,the petitioner was left with no altemative had to deposit penalty of
?86.97,876,94 on a without prejudice basis.
It is further stated in the petition that on or about 20"^ May,2011 this
Comt had passed an order of injunction restraining respondent from alienating 12 critical items over which the petitioner had the right. The petitioner came to know nearly one year" i.e. on 17^'^ April, 2012 after the order had been passed.
The petitioner partly deposited the fifth instalment on or about 12"'
Febmaiy,2012 and deposited full iristalments by 28"' Febmaiy,2012. By letter dated 18"'April,2012the petitioner pointed outvarious obsfructions to their various dismantling and lifting activities including the fact that the work on various items had been stopped due to the stay order. Thereafter there were various corTcspondences between the parties. As the disputes arose between the parties, the petitioner had filed a petition under Section 9 of the Arbitration and Conciliation Act, 1996, being O.M.P. No.757/2012 which was disposed ofon 24"'September,2012. The petitioner served the said order along with letter dated 25"' September, 2012 asking for tJre possession ofthe site. The respondent by letter dated 27"'September,2012 stated that the petitioner had not complied with the terms ofthe said order and informed that until the petitioner deposits the amount of VAT to the tune of^5,07,55,560/- the respondent will not do the needful.
It is stated in the petition thatthere can be no question ofpenalty. On the contr^ary, the petitioner is entitled to recover interest on the amounts of fourth and fifth installments in particular- which were paid much before they were due.
It is stated in the petition that the petitioner invoked the arbitration clause of the Delivery Order by notice dated ll'*^ September, 2012. The respondent failed to appoint the Arbitrator within the stipulated period of time. Therefore,the present petition has been filed.
The respondentappointed Sh.S.S. Chaudhary,asthe sole Arbitratorto adjudicate the disputes between the parties. Leairred counsel for the petitioner states that the said appointment made by the respondent is contraiy to the law. Therefore,the petitioner is insisting to the prayer made in the application. After some submissions made by the learned counsel for the parties, learned counsel for the respondent has no objection if an independent sole Arbitrator be appointed by this Court to adjudicate the disputes between the parties. He has also suggested few names on behalfof the respondent. In view thereof. Justice R.C. Chopra (Retd. Judge of this
Court) (Mobile No.9818097777/9971411226) is appointed as a sole
Arbitrator to adjudicate the disputes between the parties to be conducted under the aegis ofDelhi High Court Arbitration Centr-e! The fee shall be paid to the sole Arbihator as per rules maintained by Delhi High Court
Arbitration Centre. The petition stands disposed of.
A copy of this order be cormnrmicated to the learrred Arbitrator as well as the Secretary to the Arbitation Centre forthwith. Copies ofthe same be also given dasti to the learrred counselfor the parties.
Trvv^v cj. \r\ I MANMOHAN SINGH,J. ' MARCH 22,2013/jk
JUDGMENT