ORDER
M.Y. Eqbal, J.
1. In the instant application filed under Section 11(6) of the Arbitration and Conciliation Act, 1996 (shortly ‘the said Act’) the petitioner has prayed for appointment of Arbitrator and for reference of the dispute between the parties for adjudication by the appointed Arbitrator.
2. Petitioner’s case is that pursuant to a tender notice floated by the respondents for transportation of earth for filing up of subsidence area, Bhurkunda Colliery. Pursuant to the tender notice dated 14.8.1996 the petitioner, being a registered contractor, participated in the said tender and its tender having been found to be lowest, was accepted vide concurrence letter dated 27.3.1997. Consequent thereupon, work order was issued under the signature of respondent No. 4, the Assistant General Manager, Central Coalfield Ltd. Bhurkunda, Hazaribagh accepting the offer of the petitioner for the work of transportation of 39,000 H-3 earth for filing SAM-B of Bhurkunda colliery. In terms of the tender notice the petitioner said to have deposited earnest money and also security money. It was mentioned in the work order that the funds of Rs. 4 lacks was approved in the capital budget for the financial years 1996-97. The petitioner alleged to have complied with the terms and conditions as mentioned in the work order and an agreement was entered into between the petitioner and the opposite parties on 23.5.1997. In terms of the agreement the petitioner commenced work on 17.4.1997 and requested the opposite party No. 3 to release its first running account bill amounting to Rs. 6.98 lacks in respect of the work already performed by the petitioner under the supervision of the concerned authority. By letter dated 25.6.1997 opposite party No. 3 communicated the petitioner that in view of the fact that funds to the extent of Rs. 4,00,000/- was certified and, therefore, the bill for Rs. 6.89 lacs could not be accepted at this stage. The petitioner replied to the said letter pointing out that the total value of the work was Rs. 17.55 lacs and, as such the bill covering a sum of Rs. 6.98 lacks cannot be detained and, accordingly, requested the opposite parties to release the fund. Inspite of series of letters and representations made by the petitioner time to time the opposite parties did not release the fund. Lastly, it is contended by the petitioner that although it completed work but it was not paid any amount in spite of submission of running account bill. The petitioner then sent legal notice through his lawyer to the opposite parties for payment of the amount. However, on great persuasion the opposite parties released a sum of Rs. 8.16 lacks out of the total amount of Rs. 10.50 lacs. Thus the petitioner is still entitled to get the balance amount together with earnest and security money. The petitioner then filed a writ petition being CWJC No. 1181/2001 which was eventually dismissed as withdrawn. The petitioner, therefore, prayed to the Court to make appointment of an Arbitrator for adjudication of the dispute raised by the petitioner.
3. The respondents, in their counter affidavit, denied and disputed the averments made in the application. According to the respondents the petitioner executed only half of the work and two bills were prepared which was duly paid to the petitioner. The respondents have stated that nothing remained disputed, as the petitioner has received payment against the work executed by it.
4. I have heard Mr. A.K. Sahani, learned counsel for the petitioner and learned counsel for the respondents.
5. In course of argument, learned counsel appearing on behalf of the opposite parties submitted that the instant application under Section 11(6) of the said Act is not maintainable as because no notice was ever given by the petitioner for appointment of Arbitrator as per the arbitration clause or before invoking the provisions of Section 11(6) of the said Act.
6. Section 11 of the said Act of 1996 reads as under :
“11. Appointment of arbitrators.–(1) A person of any nationality may be an arbitrator, unless otherwise agreed by the parties.
(2) Subject to Sub-section (6), the parties are free to agree on a procedure for appointing the arbitrator or arbitrators.
(3) Failing any agreement referred to in Sub-section (2), in an arbitration with three arbitrators, each party shall appoint one arbitrator, and the two appointed arbitrators shall appoint the third arbitrator who shall act, as the presiding arbitrator.
(4) If the appointment procedure in Sub-section (3) applies and
(a) a party fails to appoint an arbitrator within thirty days from the receipt of a request to do so from the other party ; or
(b) the two appointed arbitrators fail to agree on the third arbitrator within thirty days from the date of there appointment,
the appointment shall be made, upon request of a party, by the Chief Justice or any person or institution designated by him
(5) Failing any agreement referred to in Sub-section (2), in an arbitration with a sole arbitrator, if. the parties fail to agree on the arbitrator within thirty days from receipt of a request by one party from the other party to so agree the appointment shall be made, upon request of a party, by the Chief Justice or any person or institution designated by him.
(6) Where, under an agreement procedure agreed upon by the parties
(a) a party fails to act as required under that procedure; or
(b) the parties, or the two appointed arbitrators, fail to reach an agreement expected of them under that procedure; or
(c) a person, including an institution, fails to perform any function entrusted to him or it under that procedure,
a party may request the Chief Justice or any person or institution designated by him to take the necessary measure, unless the agreement on the appointment procedure provides other means for securing the appointment.
(7) A decision on a matter entrusted by Sub-section (4) or Sub-section (5) or Sub-section (6) to the Chief Justice or the person or institution designated by him is final.
(8) The Chief Justice or the person or institution designated by him, in appointing an arbitrator, shall have due regard to-
(a) any qualifications required of the arbitrator by the agreement of the parties; and
(b) other considerations as are likely to, secure the appointment of an independent and impartial arbitrator.
(9) In the case of appointment of sole or third arbitrator in an international commercial arbitration, the Chief Justice of India or the person or institution designated by him may appoint an arbitrator of a nationality other than the nationalities of the parties where the parties belong to different nationalities
(10) The Chief Justice may make such scheme as he may deem appropriate for dealing with matters entrusted by Sub-section (4) or Sub-section (5) or Sub-section (6) to him.
(11) When more than one request has been made Sub-section (4) or subsection (5) or Sub-section (6) to the Chief Justice of different High Courts or their designates, the Chief Justice or his designate to whom the request has been first made under the relevant Sub-section shall alone be competent to decide on the request.
(12) (a) Where the matters referred to in Sub-sections (4), (5), (6), (7), (8) and (10) arise in an international commercial arbitrations, the reference to “Chief Justice in those Sub-sections shall be construed as a reference to the “Chief Justice of India.”
(b) Where the matters refer to in Sub-sections (4), (5), (6), (7), (8) and (10) arise in any other arbitration, the reference to “Chief Justice” in those Sub-sections shall be construed as reference to the Chief Justice of High Court within whose local limits the principal Civil Court referred to in Clause (e) of Subsection (1) of Section 2, is situate and, where the High Court itself is the Court referred to in that clause, to the Chief Justice of that High Court.”
7. On reading of the aforesaid provisions it is manifest that the parties are free to agree with the procedure that is to be adopted in the matter of appointment of Arbitrator. Sub-section (5) of Section 11, provides that if the parties to the agreement fail to comply the procedure and fail to agree to appoint an arbitrator, then on request of a party, appointment shall be made by the Chief Justice or any person or institution designated by him. Sub-section (6) of Section 11; provides that a party may make a request to the Chief Justice or any person or institution designated by him to pass appropriate order for appointment of an Arbitrator but before making such request it must be shown that the other party failed back as required under the procedure provided in the arbitration clause.
8. In the light of the aforesaid provisions I would like to refer the arbitration clause contained in the agreement entered into between the parties. The arbitration clause reads as under :
“All disputes or difference whatsoever arising between the parties relating to the construction meaning and operation or effect of this contract or breach thereof shall be settled by a sole arbitrator appointed by the CMD of CCL and the award of arbitrator shall be final and binding on the parties concerned. The arbitrator may from time to time with the consent of the parties, enlarge the time for making and publishing the award. The arbitration proceedings shall be in accordance with the Arbitration Act, 1940.”
9. There is no averment in the instant request petition made by the petitioner that it ever requested or called upon the Chair-man-cum-Managing Director of the respondents to appoint an Arbitrator for the purpose of deciding the dispute raised by it. Not only that even before invoking the provisions of Section 11(6) of the said Act, the petitioner did not give notice of his purported intention to make request to the Chief Justice for appointment of Arbitrator. There is no pleading to that effect in the instant request petition filed under Section 11(6) of the Act.
10. The very purpose of enactment of Section 11 of the Act, is that if a party fails to appoint an Arbitrator after receipt of notice then the Chief Justice shall appoint Arbitrator. If, within the statutory period after receipt of notice, the opposite party does not appoint Arbitrator, then it will be well within the rights of the parties to give notice to move before the Court for appointment of an Arbitrator and the Court assumes jurisdiction to appoint another Arbitrator. In my considered openion, therefore, before invoking the provisions of Section 11(6) of the Act, a party must give notice to the other party to the contract to make appointment in terms of the arbitration clause. It is only when the other party fails to appoint an arbitrator, a request can be made to the Chief Justice or any person designated by him to appoint an arbitrator in terms of Section 11(6) of the Act.
11. In the case of Datarswitch Gears v. Tata Finance Ltd and Anr., (2000) 8 SCC, 151 the Apex Court while considering a similar question observed :
“Sub-section (5) of Section 11 can be invoked by a party who has requested the other party to appoint an Arbitrator and the latter fails to make any appointment within thirty days from the receipt of the notice. Admittedly, in the Instant case, the appellant has not issued any notice to the 1st respondent seeking appointment of an Arbitrator. An application under Sub-section (6) of Section 11, can be filed when there is a failure of the procedure for appointment of an Arbitrator. This failure of procedure can arise under different circumstances. It can be a case where a party who is bound to appoint an Arbitrator refuses to appoint the Arbitrator or where two appointed Arbitrators fail to appoint the third Arbitrator. If the appointment of an Arbitrator or any function connected with such appointment is entrusted to any person or institution and such person or institution fails to discharge such function, the aggrieved party can approach the Chief Justice for appointment of an Arbitrator.”
12. In the instant application, as noticed above, neither there is any averment in the petition nor is there any document annexed therewith to suggest that the petitioner complied with the procedure provided in the arbitration clause or the provisions of Section 11 of the Act. Only a legal notice was alleged to have been sent by the petitioner stating therein that if the claim amount is not released then legal steps, both civil and criminal, shall be taken before appropriate forum for withholding of such amount.
13. For the aforesaid reasons, I am of the opinion that for non-compliance of requirements of law and procedure by the petitioner, the instant request petition for appointment of arbitrator is not maintainable which accordingly, dismissed.