IN THE HIGH COURT OF JUDICATURE AT HYDERABAD FOR THE

STATE OF TELANGANA AND THE STATE OF ANDHRA PRADESH

ARB. APPL.No.84 of 2014

Between:

M/s. Pennar Engineered Building Systems Ltd.

…Applicant

And

Consolidated Construction Consortium

…Respondent

REJOINDER FILED BY THE APPLICANT

I, A.Bhaskar Rao S/o A. Sathyanarayana Rao, Aged 44 years, Occ:

Deputy Manager, Legal, R/o.9th Floor (West Wing), DHFLVC Silicon

Towers, Kondapur, Hyderabad, State of Telangana, do hereby solemnly

affirm and sincerely state on oath as follows:

1. I am the authorized representative of the Applicant Company and as such

I am well acquainted with the facts and circumstances of the case and able

to depose as follows.

2. It is submitted that all the averments made by the Respondent in the

Counter Affidavit are denied except those which are specifically admitted

hereunder.

3. It is submitted that despite the fact that the Applicant performed all its

obligations in accordance with the terms and conditions of the Supplier

Agreement dated 04.08.2011 and Supplementary Supply Agreement dated

 02.01.2012, the Respondent did not make any payment in respect of some of

the invoices raised by the Applicant.

4. It is submitted that the Applicant in fact tried to resolve the dispute

amicably before initiating the arbitration proceedings. The Applicant

continuously followed up with the Respondent and made repeated requests

to clear the pending amount for over one and half years. When the Applicant

sent several e-mail communications to the Respondent seeking payment of

dues under the Agreement, no proper reply was given or intention to pay the

amount due was ever conveyed to the Applicant. Copy of the email

communication is filed herewith as Annexure P-9. The Respondent showed

blatant disregard to the efforts of the Applicant to settle the dispute amicably

by not even responding to its communication properly, including notice

dated 25.01.2014. Therefore, no settlement with respect to the dispute was

reached.

5. Thereafter, the Applicant issued arbitration notice to the Respondent on

22.03.2014. However, the Respondent did not even reply to the said notice

after a lapse of one month and the Applicant was constrained to approach

this Hon’ble Court.

6. It is submitted that the arbitration clause in the Agreement provides that

the Director, Operations of the Respondent will be the sole arbitrator to

adjudicate the dispute. The Applicant is seeking appointment of a Sole

Arbitrator by the Hon’ble Court, inter alia, on the ground that the arbitration

clause provides for appointment of an Arbitrator whose relationship with the

Respondent gives rise to justifiable doubts as to his independence and

impartiality. There exists a strong likelihood of bias of the Arbitrator in

 favour of the Respondent which would severely cause prejudice and affect

the rights of the Applicant.

7. It is submitted that Mr. V.G. Janarthanam - Director, Operations of the

Respondent is evidently connected to the Respondent and has influence over

and is a part of the Respondent and its management. Therefore he cannot be

appointed as a Sole Arbitrator for adjudicating the dispute.

8. Without prejudice to the above, the para-wise response to the counter

affidavit filed by the Respondent is as follows. In response to para 1, it is

submitted that the same does not require to be replied as the contents of the

para is matter of record.

9. It is submitted that the averment made in paragraph 2 that it is a

premature application is without any merit and deserves to be rejected. The

Applicant attempted to resolve the dispute amicably but no response in this

regard was received from the Respondent.

10. It is submitted that paragraphs 3, 4 and 5 are formal in nature and hence

are not specifically traversed.

11. It is submitted that the contents of paragraph 6 are entirely denied as

false, baseless and untrue. It is specifically denied that the Applicant failed

to perform its obligations under the Agreement and that the Respondent

suffered losses. In fact it is submitted that the Respondent never raised any

issues with respect to the Applicant’s performance under the Agreement.

Nor did the Respondent deny its liability with respect to the invoices raised.

The averment that the Respondent raised issues with respect to the
 Applicant’s performance is denied as false and baseless and the Respondent

is put to strict proof of the same.

12. It is submitted that the averments in para 8 are denied in entirety as false

and baseless. It is specifically denied that the Applicant is seeking payment

of invoices without complying with the terms of the Agreements.

13. In response to para 9 to 11 it is submitted that the averments made by the

Respondent that the Applicant did not follow the mandatory procedure

stipulated in the Arbitration Clause under the Agreement is false, baseless

and without any merit. It is reiterated that the Applicant sent several

communications to the Respondent requesting payment but the Respondent

never replied to them properly. It is submitted that the present application

was filed only after the Parties failed to settle the dispute amicably. For over

a period of one and half years, the Applicant continuously followed up with

the Respondent on the dispute of non-payment of some invoices but it was

of no avail. The Respondent did not even properly reply to the

communication. In this backdrop, it cannot be said that no attempt was made

at all to settle the dispute amicably between the parties. Further, in any

event, without prejudice to the foregoing it is submitted that the requirement

to comply with the procedure in the arbitration clause is only directory and

not mandatory and it cannot act as a bar to initiate arbitration proceedings.

In view of the above, it is humbly submitted that this Hon’ble

Court may be pleased to allow the Arbitration Application filed by the

Applicant and grant relief as sought for in the main Application (ARB

APPL 84 of 2014) and pass further order or orders as this Hon’ble Court

deem fit and proper in the circumstances of the case.

Solemnly affirmed and signed DEPONENT
before me on this the 2nd day
of August, 2018.

VERIFICATION STATEMENT

I, A.Bhaskar Rao S/o A. Sathyanarayana Rao, Aged 44 years, Occ:

Deputy Manager, Legal, R/o.9th Floor (West Wing), DHFLVC Silicon
Towers, Kondapur, Hyderabad, State of Telangana do hereby affirm that
I have read the contents of the above affidavit and the same are true to the
best of my knowledge.

Hence verified before me on this the 2nd day of August, 2018

Counsel for the Applicant DEPONENT