INDIAN INSTITUTE OF TECHNOLOGY MADRAS Vs. MIDWAY SERVICES

JUDGEMENT

(1.) The petitioner is the Indian Institute of Technology-Madras (in short, "IIT-M"?) and it invoked Section 11(4) of the Arbitration and Conciliation Act, 1996 (in short, "the Act") for appointment of a Sole Arbitrator to resolve the disputes and differences arising between the parties under the Open Tender No.OEC/RAJ/07/2016, dated 02.09.2016 and the Purchaser Order No.OEC/RAJI/2016/1156/SPLX/ 825, dated 27.02.2017. (in short, "PO"?).

(2.) Earlier, the same petitioner has invoked the jurisdiction of this Court by filing an application under Section 9 of the Act seeking a direction to the respondent to furnish security to the tune of Rs.1,42,09,690/-, which application, after contest, was dismissed by this Court on 12.02.2019. While dismissing the same, this Court had directed the petitioner to refer the matter to arbitration within a period of 30 days and once the notice is issued to refer the matter to Arbitrator, the respondent, on receipt of the same, immediately make its response and if both the parties agreed for an appointment of a Sole Arbitrator, the proceedings can go on with the appointment of a Sole Arbitrator, or otherwise, a Tribunal consisting of three Arbitrators, as set out / discussed in the said order can be constituted immediately. Admittedly, there is no challenge to the said order and it attained finality.

(3.) After the dismissal of the said application on 12.02.2019, there was a notice issued by the learned counsel for the petitioner on 11.03.2019, which is a notice of appointment of an Arbitrator based on the PO dated 27.02.2017 issued in pursuance to the Open Tender dated 04.11.2016, wherein, the name of one Mr.K.D.Arcot, Member of the Indian Institute of Technical Arbitrators (IITA), was proposed to be appointed as the sole Arbitrator to resolve the disputes calling upon the respondent herein to confirm the same within a period of thirty days. On receipt of the said notice, a reply notice dated 01.04.2019 was sent by the learned counsel for the respondent vehemently denying the notice issued under Section 21 of the Act, firstly, alleging that there was no material breach, fraud or any overt act as alleged and secondly, denying the applicability of the arbitration clause. A rejoinder dated 19.04.2019 to the said reply was once again issued by the learned counsel for the petitioner stating that as the respondent had not agreed for appointment of a Sole Arbitrator, the Arbitral Tribunal comprising of a three Arbitrators in accordance with the arbitration agreement contained under Clause 21 of the Tender Document could be appointed.