PACL INDIA LTD Vs. RAJENDRA SINGH KHETASAR

JUDGEMENT

(1.) THE applicant, a company incorporated, has preferred this application for appointment of an arbitrator to resolve the dispute between it and the respondent arising under the arbitration agreements dated 12.3.2006 and 28.10.2006. The arbitration agreement provides a dispute resolution mechanism in the terms that "any dispute or difference, whatsoever, arising between the parties out of or in relation to the construction, meaning, scope, operation or effect of the agreement or the validity or the breach thereof, shall be referred for arbitration to any retired judicial officer who shall be appointed by mutual consent, as the sole arbitrator, shall be settled in accordance with Arbitration And Conciliation Act, 1996 or any statutory modification or re -enactment thereof for the time being in force, and the award made in pursuance thereof, shall be final and binding on the parties, or in alternative appointment of arbitrator would be in accordance with Arbitration And Conciliation Act, 1996".

(2.) THE facts necessary to be noticed for disposal of the application are that the applicant company is involved in the business of developing waste land for agricultural, horticulture and farming activities including herbal farming. For the purpose aforesaid the company was in need of huge agriculture land in the districts of Jodhpur, Jaisalmer, Barmer, Jalore, Bikaner, Churu and Nagaur in the State of Rajasthan. Respondent Shri Rajendra Singh Khetasar (now represented by his legal representatives), a property consultant, entered into two agreements dated 12.3.2006 and 28.10.2006 to procure agriculture land in the districts aforesaid at the rates to be mutually decided by the parties according to its quality and location. It was agreed between the parties that the respondent shall procure/ transfer/ sell scheduled lands by way of registered sale deeds in favour of the applicant company or its nominees/agents and the company shall pay Rs.1000/ - per bigha to the respondent for the services rendered. According to the applicant, the applicant company paid an amount of Rs.213 crores to the respondent through banking channels and the respondent furnished 1523 sale deeds relating to purchase of more than one lac bighas of land. The applicant company shocked to notice that the lands purchased by the respondent were in close proximity to Indo -Pak Border in the districts of Barmer, Jaisalmer and Jalore and were located within the notified/restricted areas covered under a notification dated 12.3.2006 issued by the Ministry of Home Affairs, Government of India. The substantial part of lands purchased were not in the name of the respondent or its nominee(s) but in the name of family members, relatives, associates and nominees of the respondent. The applicant by a notice dated 13.3.2008 called upon the respondent to refund the amount paid to him, but of no consequence. A notice as per Section 11 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as 'the Act of 1996'), thus, was given to invoke the arbitration clause in the agreements dated 12.3.2006 and 28.10.2006. The respondent responded the notice and denied the defaults and breaches alleged by the applicant company. As per the respondent, there was no dispute and no cause of action for invoking arbitration agreement. On being failed to get the arbitrator appointed, the applicant has preferred this application.

(3.) ACCORDING to the applicant the respondent has violated the terms and conditions of arbitration agreement and, therefore, a dispute exists between the parties that deserves to be adjudicated through arbitral proceedings.