Full Judgment
GA No.1199 of 2014 AP No.492 of 2014 IN THE HIGH COURT AT CALCUTTA Ordinary Original Civil Jurisdiction Original Side PAM DEVELOPMENTS PVT.LTD.Versus STATE OF WEST BENGAL & ORS.Appearance Mr.Priyankar Saha, Adv.Mr.P.Sinha, Adv.BEFORE: The Hon'ble JUSTICE SANJIB BANERJEE Date : April 24, 2014.
The Court : Sufficient grounds have been made out as to why the petitioner was not represented on April 11, 2014 when AP No.492 of 2014 was dismissed for default.
The order dated April 11, 2014 is recalled and AP No.492 of 2014 is restored to the file.
The restoration application, GA No.1199 of 2014, is allowed as above without any order as to costs.
By consent of the parties, AP No.492 of 2014 is immediately taken up for hearing.
This is a request under Section 11 of the Arbitration and Conciliation Act, 1996 for the appointment of an arbitrator upon the appointing authority failing to make an appointment within reasonable time of receipt of the petitioner’s notice of invocation.
The petitioner says that the conduct of the respondents has been unfair, particularly, since an appointment has been sought to be made after the request was dismissed for default, though no appointment had been made despite due receipt of the notice of invocation of January 30, 2014.
The petitioner says that at least two adjournments had been obtained by the respondents when the petitioner was ready to pursue AP No.492 of 2014.
The petitioner contends that since the appointing authority has sought to overreach the Court by making an appointment with full knowledge that AP No.492 of 2014 had been merely dismissed for default and would be restored upon an application being filed in such regard, the appointment now made by the Chief Engineer, PWD, should be disregarded.
The petitioner is correct that AP No.492 of 2014 had been adjourned on at least two occasions prior to its dismissal.
The adjournments were sought on behalf of the State to ascertain whether service of the notice of invocation had, in fact, been effected before a responsible stand was taken on behalf of the State in Court.
It was, however, insinuated on behalf of the State that the notice may not have been served since the office of the Chief Engineer was shifted from Writers’ Buildings to Nabanna prior to the issuance of the notice of invocation.
The arbitration agreement does not stipulate any time within which the appointing authority should respond upon the arbitration agreement being invoked.
The relevant provision, Section 11(6) of the 1996 Act, is also silent in such regard.
However, it has been judicially interpreted that if a request is made to the appointing authority, the reasonable time for such appointing authority to constitute the arbitral tribunal should be regarded to be a period of 30 days from the date of receipt of such request.
Such judicial interpretation has been prompted by the reference to 30 days in a similar provision elsewhere in Section 11 of the 1996 Act.
However, it has also to be appreciated that if an appointment of an arbitrator is not made by the appointing authority within 30 days or even a year from the date of the receipt of the notice of invocation, but the party invoking the arbitration agreement does not complain in such regard, the appointing authority is not divested of the jurisdiction to make the appointment merely by reason of the delay.
However, if the appointing authority is aware of a request under Section 11 of the Act having been made upon the appointing authority not acting within reasonable time of the receipt of the notice of invocation, the appointing authority can no longer make the appointment.
But if the appointing authority were to make the appointment some six months after the receipt of the notice of invocation without the party invoking the arbitration agreement having filed a request under Section 11 of the 1996 Act till then, it cannot be said that the appointing authority had lost the jurisdiction to make the appointment.
In the present case, it was suggested on behalf of the State that the appointing authority may not have received the notice invoking the arbitration agreement as claimed by the petitioner.
However, a copy of the petition had been received by both the appointing authority and by the State.
Accordingly, the knowledge of the appointing authority qua the notice of invocation had to be reckoned from the date of knowledge of the petition even if the appointing authority had not been served the original notice of invocation.
In such circumstances, it cannot be said that the appointing authority has tried to overreach the Court by making the appointment after the request under Section 11 of the 1996 Act stood dismissed for default.
There was a theoretical possibility that the request may not be revived.
In such circumstances, it does not appear that there has been any act of unfairness or impropriety in the appointing authority securing the composition of the arbitral tribunal subsequent to the request made to the Chief Justice or his designate under Section 11(6) of the Act being dismissed for default.
The appointment was made before the respondents were served a copy of the restoration application.
As a consequence, though the request under Section 11 of the 1996 Act is restored, such request is now held to be of no effect since the appointment had already been made.
AP No.492 of 2014 is disposed of accordingly without any order as to costs.
A copy of the notice of appointment of April 11, 2014 should be retained with the papeRs.Certified website copies of this order, if applied for, be urgently supplied to the parties subject to compliance with all requisite formalities.
(SANJIB BANERJEE, J.) sg.