2022 INSC 0011 NON­REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO(S).54  OF 2022    (Arising out of SLP(Civil) No(s). 28682 of 2019) M/S. DURGA WELDING WORKS ….APPELLANT(S) VERSUS CHIEF ENGINEER, RAILWAY  ELECTRIFICATION, ALLAHABAD & ANR. …..RESPONDENT(S) J U D G M E N T Rastogi, J. 1. Leave granted. 2. The instant appeal has been filed assailing the order dated 26 th July,   2019   declining   to   appoint   an   Arbitrator   in   exercise   of   its 1 power   under   Section   11(6)   of   the   Arbitration   and   Conciliation   Act, 1996(hereinafter being referred to as “the Act”). 3. The   seminal   facts   not   in   dispute   are   that   the   tender   of   the appellant   was   accepted   and   the   same  was  communicated   by  letter dated   30 th   November,   2006   in   reference   to   which   a   contract agreement was executed between the parties containing clauses 63 and 64 of the general conditions of contract containing the clause of arbitration   for   settlement   of   claims   and/or   disputes   between   the parties.     Since   there   were   claims   which   could   not   be   settled,   the appellant   served   a   legal   notice   dated   3 rd   August,   2009   for appointment   of   an   Arbitrator   and   for   settlement   of   claims. Although,   there   was   no   express   reference   made   of   clauses   63   and 64 in the notice, but the pith and substance of the notice dated 3 rd August, 2009 was for settlement of disputes through the process of arbitration   in   terms   of   the   clause   of   arbitration   under   general conditions   of   agreement   which   is   a   part   of   the   contract   agreement executed between the parties. 4. It   is   not   disputed   that   the   notice   dated   3 rd   August,   2009   was duly   served   upon   the   respondents.     It   is   alleged   that   since   the 2 respondents failed to appoint an arbitrator pursuant to notice dated 3 rd   August 2009, Arbitration Petition(ARBP No. 61 of 2009) came to be   filed   on   23 rd   October,   2009   in   the   High   Court   of   Orissa   for appointment of an Arbitrator under Section 11(6) of the Act. 5. It reveals from the record that just after filing of the arbitration petition,   the   appellant   has   completely   forgotten   of   taking   action   in furtherance thereto and it was never in notice of the respondents of such petition being filed since no notice was served at any stage.   6. In   the   meanwhile,   the   respondents   vide   letter   dated   28 th January,   2010,   in   response   to   the   letter   of   the   appellant   dated   3 rd August, 2009 asked the appellant to select two names from a panel of four persons. 7. It   is   alleged   that   immediately   thereafter,   on   17 th   February 2010,   Miscellaneous   Case   No.   4   of   2010   was   filed   in   Arbitration Petition   No.   61   of   2009   seeking   an   order   restraining   the respondents from appointing an Arbitrator and that application too remained  pending  and  no  action was  taken  up by   the appellant  to pursue   either   the   Arbitration   Petition   No.   61   of   2009   or   the Miscellaneous Case No. 4 of 2010 before the High Court. 3 8. In   the   meanwhile,   by   letter   dated   28 th   August   2010,   two officers from the panel suggested by the respondents were selected by   the   appellant   and   in   furtherance   thereto,   the   respondents constituted an Arbitration Tribunal by letter  dated 24 th   September, 2010.     The   appellant   thereafter   appeared   before   the   Arbitral Tribunal   on   25 th   October,   2010   and   preferred   statement   of   claim. The   respondents   also   submitted   their   statement  of   defence   on   15 th November, 2010. 9. The appellant thereafter appeared before the Arbitral Tribunal on   27 th   December,   2011   and   submitted   an   application   that   the Tribunal   has   not   been   nominated   within   the   stipulated   time   and hence,   the   constitution   of   the   Arbitral   Tribunal   is   not   valid   and further   submitted   that   the   Tribunal   should   not   proceed   with   the arbitration   proceedings.   The   fact   still   remains   that   the   arbitration petition   filed   by   the   appellant   on   23 rd   October,   2009   has   not   seen the light of the day except the fact that it was filed in the Registry of the High Court. 10. Since   the   Arbitral   Tribunal   was   constituted,   with   consent   of the   appellant,   the   Tribunal   proceeded   with   the   arbitration 4 proceedings and since the appellant failed to participate despite the opportunity   being   afforded,   ex­parte   award   came   to   be   passed   on 21 st  June, 2013 rejecting the claim of the appellant.  The fact is that finally in the arbitration petition filed by the appellant, notices were issued   to   the   respondents   by   the   High   Court   in   the   year   2016, almost 3 years after passing of the ex­parte award dated 21 st   June, 2013.     The   High   Court,   taking   note   of   such   peculiar   facts   and circumstances, dismissed the arbitration petition by an Order dated 26 th  July, 2019 with liberty to the appellant to submit its objections under Section 34 or 37 of the Act, if so advised. 11. We  have  heard   learned   counsel   for   the   parties   and  with   their assistance perused the material available on record. 12. The exposition of legal principles is indeed well settled by this Court in   Datar Switchgears Ltd. Vs. Tata Finance Ltd. & Anr. 1 followed  in   Punj  Lloyd   Ltd.   Vs.   Petronet   MHB   Ltd. 2   that   once   an application   under   Section   11(6)   of   the   Act   has   been   filed   for appointment   of   an   Arbitrator   before   the   High   Court,   the respondents   forfeited   their   right   to   appoint   an   Arbitrator   and   the 1 2000(8) SCC 151 2 2006(2) SCC 638 5 High   Court   alone   holds   jurisdiction   to   appoint   an   Arbitrator   in exercise of power under Section 11(6) of the Act.   Indisputedly, the appointment   of   an   Arbitrator   was   made   by   the   respondents   after arbitration petition was filed by the appellant under Section 11(6) of the Act in the Registry of the High Court on 23 rd  October, 2009. 13. This   Court   cannot   be   oblivious   of   the   peculiar   facts   and circumstances   brought   to   our   notice   that   after   filing   of   an arbitration petition on 23 rd  October 2009 in the Registry of the High Court,   the   appellant   completely   slept   over   the   matter   and   the respondents   were   never   served   of   any   notice   of   the   Arbitration Petition (ARBP No. 61 of 2009) filed before the High Court of Orissa. At the given time, when the respondents called upon the appellant to   suggest   and   select   two   names   out   of   the   panel   of   four   for constitution of the Arbitral Tribunal, the appellant vide letter dated 28 th  August, 2010 selected two officers from the panel suggested by the   respondents.     Pursuant   thereto,   the   Arbitral   Tribunal   was constituted   by   the   respondents   vide   letter   dated   24 th   September, 2010   and   the   appellant   thereafter   appeared   before   the   Arbitral Tribunal   on   25 th   October,   2010   and   submitted   his   statement   of 6 claim   and   in   furtherance,   statement   of   defence   was   submitted   by the respondents. 14. The fact still remains that except the letter being once sent by the   appellant   on   27 th   December,   2011   informing   of   the   arbitration petition   being   filed   under   Section   11(6)   of   the   Act   before   the   High Court,   no   steps   were   taken   thereafter   to   pursue   his   arbitration application and since the appellant had not participated before the Arbitral   Tribunal   after   filing   of   the   statement   of   claim,   ex­parte award   came   to   be   passed   by   the   Arbitral   Tribunal   on   21 st   June, 2013.   It may be noticed that notices were issued for the first time by the High Court of the arbitration petition filed by the appellant in the   year   2016   almost   3   years   after   passing   of   the   ex­parte   award dated 21 st  June, 2013. 15. In the given facts and circumstances, the High Court was not inclined to exercise its jurisdiction under Section 11(6) of the Act for appointment   of   an   Arbitrator   and   dismissed   the   petition   by   an Order dated 26 th   July, 2019 with liberty to the appellant to submit objections against the ex­parte award dated 21 st   June, 2013 under Section 34 or 37 of the Act, if so advised. 7 16. In   our   considered   view,   so   far   as   the   question   of   law   is concerned,   certainly   being   settled   that   after   the   application   has been   filed   for   appointment   of   an   Arbitrator   under   Section   11(6)   of the Act, before the High Court the respondents forfeited their right to   appoint   an   Arbitrator   under   the   clause   of   arbitration   thereafter but   from   the   narration   of   facts   which   has   been   noticed   by   us,   we are   of   the   view   that   no   error   was   committed   by   the   High   Court   in dismissing   the   petition   filed   under   Section   11(6)   of   the   Act   for appointment of an Arbitrator by an Order dated 26 th  July, 2019. 17. Consequently, the appeal fails and accordingly dismissed. 18. Pending application(s), if any, stand disposed of. ……………………………..J. (AJAY RASTOGI) …………………………….J. (ABHAY S. OKA) NEW DELHI JANUARY 04, 2022 8