High Court of Punjab and Haryana, Chandigarh
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M/S GEETIKA PLASTICS. v. PUNJAB LAND DEVELOPMENT AND RECLAMATION - CR-2104-1998  RD-P&H 175 (17 January 2006)
IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
C.R. No. 2104 of 1998.
Date of Decision: 1.2.2006.
M/s Geetika Plastics. ...Petitioner.
Punjab Land Development and Reclamation Corporation Ltd.
CORAM: HON'BLE MR. JUSTICE HEMANT GUPTA.
Present: Shri P.S. Rana, Advocate,
for the petitioner.
None for the respondent.
The petitioner is aggrieved against the orders passed by the Courts below, whereby its application for appointment of arbitrator in terms of Section 20 of the Arbitration Act, 1940 (hereinafter for short referred to as `the Act'), has been declined.
It is the case of the petitioner that on 3.7.1985 the petitioner was awarded a contract for the supply of 2 lacs of HDEP bags. In pursuance of such agreement, the petitioner Corporation has given delivery C.R. No. 2104 of 1998. (2)
schedule from time to time. In terms of such delivery schedule, the petitioner has prepared the bags for the supply to the respondent. On 24.10.1985 the delivery schedule was given for supply of the bags but on 6.3.1987 without receiving the entire contracted quantity of bags, the contract was cancelled. Since the contract was cancelled in violation of the terms of the contract, the petitioner communicated to the Corporation that the cancellation of the contract is against the terms of the Act and that 37500 bags have been despatched to Hanumangarh for delivery on 31.1.1986. Therefore, the petitioner demanded the refund of the security amounting to Rs. 57500/- and also called upon the respondent to lift the said bags within 10 days failing which the same would be sold either by public auction or private sale and the short-fall in the price will be recovered from the respondent.
The petitioner has raised the dispute and sought appointment of arbitrator by moving an application under Section 20 of the Act. It has been held by the learned trial Court that the petitioner has sought to raise dispute after the security has been withdrawn and, therefore, no dispute exists between the parties and the arbitrator is not liable to be appointed.
The said finding has been affirmed by in appeal as well.
Learned counsel for the petitioner has vehemently argued that the finding recorded that the petitioner has sought appointment of an arbitrator after the security has been refunded, is incorrect. The contract C.R. No. 2104 of 1998. (3)
was cancelled on 6.3.1987. The petitioner has sought filing of the agreement and to refer the dispute to the arbitrator vide an application under Section 20 of the Act filed on 26.3.1987. The petitioner demanded to refund the security during the pendency of the said petition on 6.6.1987 and therefore, the reasoning given by the Courts below is factually incorrect.
A perusal of the record shows that on 6.3.1987, the contract was cancelled by the respondent on the ground that the petitioner has failed to supply the bags. Soon thereafter, the petitioner has sought the intervention of the Court for filing of the arbitration agreement and for referring the dispute between the parties to the arbitrator on 27.3.1987 itself.
It is during the pendency of the said petition that the request was made for the refund of the security. Therefore, the reasoning given by the Courts below that the petitioner has sought the filing of the agreement and reference of the dispute to the arbitrator after withdrawal of the security, is clearly not borne out. Both the Courts have committed factual mistake in returning the finding against the petitioner. Therefore, the orders passed by the Courts below are not sustainable in law.
Consequently, the present revision petition is allowed. The orders passed by the Courts below are set aside.
The petitioner through its counsel is directed to appear before the learned Civil Judge Senior Division, Chandigarh on 6.3.2006 for further proceedings in accordance with law. It shall be open to the learned Civil C.R. No. 2104 of 1998. (4)
Judge (Senior Division) Chandigarh, to entrust the case to any other Court of competent jurisdiction.
1.2.2006 (Hemant Gupta)
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