BHAGAWATI GASES LIMITED (BGL) Vs. HINDUSTAN COPPER LIMITED

JUDGEMENT

(1.) This application under Section 11 of the Arbitration and Conciliation Act, 1996 (for short, 'the Act of 1996') has been filed by M/s Bhagawati Gases Limited, Jhunjhunu, inter-alia, with prayer that sole arbitrator be appointed for resolving its dispute with the non-applicant Hindustan Copper Limited.

(2.) Facts of the case are that an agreement was entered into between the applicant and non-applicant on 05.05.2005 with the former agreeing to supply gaseous oxygen and liquid oxygen to the latter at their Khetri Copper Complex Smelter Plant. Clause 15 of the agreement provided for reference of the dispute between the parties to the sole arbitrator or a person appointed jointly by the Chairman of HCL and the applicant-BGL. It was further stipulated that the provisions of the Act of 1996 shall apply and that the award of the arbitrator shall be final. The Arbitrator shall be competent to decide whether any matter, dispute or difference referred to him falls within the purview of arbitration.

(3.) A dispute arose between the parties when the applicant claimed payment from the non-applicant for balance amount of minimum off-take guarantee for the period from 12.02.2009 to 12.02.2010 and the minimum off-take guarantee for the period from 12.02.2010 to 13.09.2011. The petitioner has been raising debit notes every month on account of the amount due by the respondent for minimum off-take guarantee. When the respondent denied the payment, the petitioner, by letter dated 19.10.2011 requested the respondent to appoint arbitrator in terms of arbitration agreement. The respondent, by letter dated 17.09.2011, denied the claim of the petitioner inter-alia contending that no dispute existed relating to minimum off-take guarantee and further denied to refer the dispute to the arbitrator. The respondent thereupon instituted a civil suit titled Hindustan Copper Limited Vs. Bhagwati Gases Limited before the City Civil Court, Kolkata, in which he prayed for declaration that the notice dated 19.10.2011 sent by the petitioner (defendant in the suit) is void-ab-initio and nullity. Further prayer was also made for permanent injunction restraining him from giving any further effect to the said letter/notice dated 19.10.2011.