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HIGH COURT OF DELHI
Date of order : 10th March, 2023
M/S MUBARAK OVERSEAS PRIVATE LIMITED ..... Petitioner
Through: Mr. Jai Sahai Endlaw, Mr. Gaurav Aggarwal and Ms. Mahima Misra, Advocates
Through: Mr. Harish Vaidyanathan Shankar, CGSC with Mr. Srish Kumar
Mishra, Mr. Sagar Mehlawat and Mr. Alexander Mathai Paikaday, Advocates for UOI
Mr. Saubhagya Chauriha, Advocate
CHANDRA DHARI SINGH, J (Oral)
JUDGMENT
1. The instant petition under Section 11(6)(C) read with Section 43(4) of the Arbitration and Conciliation Act, 1996 (hereinafter "The Act, 1996"), has been filed on behalf of petitioner seeking the following relief:-
2. Learned counsel for the petitioner submitted that the present petition arose as a result of setting aside the Arbitral Award dated 31st October 2021 passed by Dr. Padmini Singh, the Learned Sole Arbitrator, whereby she was pleased to dismiss the claim of the petitioner and allow the counter-claim of the respondent without any evidence being led by the respondent in support of losses which they suffered, by learned District Judge(Commercial Court)-02, Patiala House Courts, New Delhi vide Order dated 28th September 2022. It is further submitted that the issue now remains unresolved and inconclusive and the requirement of another Arbitral Tribunal has arisen to adjudicate the disputes between the parties.
3. Learned counsel for the petitioner further submitted that the RFP bearing no. 62501/Q/1/RFP/2017-18/NeML (Rice)/2017/APO was issued on 13th June, 2017, inviting Online bids for the supply of cumulative 16900 MT of Sharbati Rice to be delivered between 20th July 2017 and 19th August 2017 to various consignee depots of the respondent in specified quantities.
4. Learned counsel for the petitioner further submitted that the petitioner was a participant in the aforesaid tender and its bid of INR 80,57,700 was accepted for the supply/delivery of 200 MT Sharbati Rice to be delivered to Officer Commanding, Supply Depot, ASC Suratgarh. It is also submitted that the delivery period specified in the Notice of acceptance of tender dated 28th July 2017 was provided as 1st August 2017 to 30th August 2017.
5. Learned counsel for the petitioner submitted that among other things one of the conditions for the supply of rice was for the petitioner to furnish a performance bank guarantee of INR 8,57,770 in the form of a bank guarantee/FDR on or before 7th August 2018 and that the petitioner furnished the aforesaid amount towards performance bank guarantee bearing no. 3101417BG0000009 dated 3rd August 2017.
6. Learned counsel for the petitioner further submitted that the petitioner supplied the entire supply of 200 MT of rice at Suratgarh and was later informed by Major Khush Mishra that the rice supplied by the petitioner’s company had been rejected by CFL, Delhi without communicating the reasons for rejection. It is also submitted that the report of the CFL was also not supplied to the petitioner.
7. Learned counsel for the petitioner submitted that on 19th September 2017, the petitioner was reminded by Major Khush Mishra that the period for filing the appeal has expired and the petitioner is required to take back the unfit stock by 20th September 2017 in accordance with the terms and conditions of the Contract otherwise the same would be destroyed.
8. Learned counsel for the petitioner further submitted that vide letter dated 30th October 2018, the respondent terminated the Contract on account of the failure of the petitioner to supply the said amount of quantity of rice, and the Bank Guarantee was also forfeited by the respondent.
9. Learned counsel for the petitioner further submitted that the petition under Section 9 namely OMP(I)(Comm) No. 464/2017 was filed by the petitioner seeking a restraining order against the invocation of Bank Guarantees by the respondent. This Court was pleased to grant an interim stay till the disposal of Arbitral Proceedings before the Learned Arbitral Tribunal. It is also submitted that Bank Guarantee is still alive.
10. Learned counsel for the petitioner submitted that that petitioner filed another petition under Section 11 of the Act, 1996 bearing Arb. P. No. 100/2018 seeking appointment of Sole Arbitrator. It is submitted that the respondent made a statement before this Court that the respondent had already appointed a Sole Arbitrator in accordance with the Agreement between the parties leading to the Petition being disposed of.
11. Learned counsel for the petitioner further submitted that the learned Sole Arbitrator appointed by the respondent couldn’t adjudicate the matter and that the petitioner approached this Court under Sections 14 and 15 read with Section 29 seeking the termination of the mandate of the learned Sole Arbitrator and the same was rejected by the Court. It is submitted that a Special Leave Petition was filed against the order of the High Court during the pendency of which the respondent appointed Dr. Padmini Singh, Addl. Legal Adviser for Ministry of Law and Justice as the learned Sole Arbitrator to which the petitioner consented before the Hon’ble Supreme Court of India.
12. Learned counsel for the petitioner submitted that the Arbitration Proceedings were initiated and parties were given opportunities to file their claims, counter-claims, respective evidence and written submissions.
13. Learned counsel for the petitioner further submitted that on 31st December 2021, the learned Sole Arbitrator passed the Award whereby the claim of the petitioner was dismissed and the counter-claim of the respondent was allowed without any evidence being led by the respondent.
14. Learned counsel for the petitioner further submitted that the petitioner being aggrieved by the decision of the learned Sole Arbitrator challenged the Impugned Award before the learned District Judge (Commercial Court)-02, Patiala House Courts, New Delhi, and the same was set aside by the Learned District Judge.
15. Learned counsel for the petitioner further submitted that it is abundantly clear that the conflict between both parties remained unsolved and therefore, the need for the appointment of another Arbitrator has arisen to adjudicate the dispute between the parties.
16. During the course of arguments, learned counsel for the respondents agreed with the prayer of the petitioner and consented to the appointment of a Sole Arbitrator for adjudicating the aforementioned dispute.
17. Heard learned counsel for the parties.
18. As agreed on behalf of the parties, it is evident that the parties intend the Court to refer the disputes to arbitration, by appointing a sole arbitrator. In view of the request made by the parties, the said disputes and differences arising between the parties are referred to arbitration, by appointing an arbitral tribunal. Hence, the following Order: ORDER
(i) Ms. Radhika Biswajit Dubey, Advocate is appointed as a sole arbitrator to adjudicate the disputes which have arisen between the parties;
(ii) The learned sole arbitrator, before entering the arbitration reference, shall ensure the compliance of Section 12(1) of the Arbitration and Conciliation Act, 1996;
(iii) The learned sole arbitrator shall be paid fees as prescribed under the Delhi International Arbitration Centre (DIAC) (Administrative Cost and Arbitrators Fees) Rules, 2018 as amended vide notification dated 15th November, 2022;
(iv) At the first instance, the parties shall appear before the learned sole arbitrator within 10 days from today on a date which may be mutually fixed by the learned sole arbitrator;
(v) All contentions of the parties are expressly kept open.
19. The petition is disposed of in the aforesaid terms along with pending application, if any.
20. The order be uploaded on the website forthwith. A copy of the order be forwarded to the learned sole arbitrator on the following address: Ms. Radhika Biswajit Dubey F-18, 3rd Floor Geetanjali Enclave, New Delhi – 110017 Ph. No. – 9810982927.