Sr. No.25 IN THE HIGH COURT OF JAMMU & KASHMIR AND LADAKH AT JAMMU (Through Virtual Mode) Arb P No.95/2025 Rahil Gupta …Petitioner(s). Through: Mr. Pranav Kohli, Sr. Advocate, with Mr. Anany Gupta, Advocate. Vs. J&K Industries Dev. Corpn. and others. ….Respondent(s) Through: Ms. Nazia Fazal, Advocate, vice Mr. Dewakar Sharma, Dy.AG. CORAM: HON’BLE THE CHIEF JUSTICE O R D E R 31.10.2025 1. The present petition has been filed under Section 11(6) of the Arbitration and Conciliation Act, 1996, seeking appointment of an arbitrator. 2. The petitioner, being a sole proprietor, was allotted land measuring 04 kanals at Industrial Growth Centre, Samba Phase-III by respondent No. 03 vide Order No. SIDCO/ROJ/Proj/15/175/2013-19 dated 26.10.2017 for setting up a unit to manufacture Surgical Cotton, Bandage rolls, bandage cloth and absorbent gauze cloth. The petitioner deposited a total amount of Rs. 16,31,000/- which included the land premium @ Rs. 4 lacs per kanal, Rs. 30,000/- towards advance rent for two years and Rs. 1,000/- as processing fee. Subsequently, a lease deed dated 04.04.2018 came to be executed between the parties for a period of 40 years. The petitioner, however, is stated to have received the possession of the land only in the year 2019 after a gap of over 01 year. Upon taking the possession, the petitioner approached the respondents to provide the basic infrastructural facilities for the land, as the petitioner found the land lacked basic facilities such as road connectivity, water supply and drainage system which made him unable to establish the unit. Despite repeated requests, the respondents did not provide the basic amenities. It is stated that the establishment of the unit got further delayed due to COVID-19 pandemic in 2020 and by the time the petitioner could start establishing the unit, the stipulated period of two years in the lease deed for setting up the unit had expired. The petitioner, thereafter, approached the respondents for extension which was granted up to 30.06.2022. It is stated that the petitioner also applied for a bank loan, however, the same came to be rejected for the reason that the land lacked basic infrastructural facilities. It is stated that while the petitioner was in the process of making his unit functional, the respondents issued communication No. SIDCO/IGC/24/Sa/541-544 dated 10.09.2024, cancelling the allotment order dated 26.10.2017 and terminated the lease deed. Aggrieved of the cancellation order, the petitioner challenged the same under Section 9 of Arbitration and Conciliation Act, 1996 before the Principal District Judge, Samba, and the Court, in terms of the order dated 26.11.2024, stayed the operation of the communication dated 10.09.2024. The petitioner approached the respondents time and again for redressal of his grievances but to no avail. It is urged that clause 43 of the lease deed dated 04.04.2018 provides that the Managing Director / Chairman, SIDCO, would act as an arbitrator for adjudication of the disputes inter-se parties. However, in view of the provisions of Section 12 read with Seventh Schedule of Arbitration and Conciliation Act, 1996, the Managing Director/Chairman of the respondent corporation cannot act as an arbitrator being the head of the corporation, as such, having an interest in the dispute and is directly related to the affairs of the corporation. Accordingly, the petitioner served a notice dated 23.01.2023 upon the respondents seeking appointment of an independent arbitrator. Despite having received the notice the respondents have failed to appoint any arbitrator. 03. Heard. Notice. Page 3 of 3 04. Served with advance copy of the petition, Ms. Nazia Fazal, Advocate, present in Court, accepts notice. 05. The existence of the arbitration clause, as aforesaid, and its invocation by the petitioner vide notice dated 23.01.2023, is not disputed. 06. Thus, in the given circumstances, learned counsel for the respondent, as always, fairly submits that let an arbitrator be appointed. But since the claim that is sought to be made by the petitioner is vehemently disputed/ denied, it is submitted that respondent be granted liberty to raise all possible pleas/ objections before the arbitral tribunal/ arbitrator in this regard. 07. Accordingly, in the wake of the position sketched out above and in terms of the statements made by the learned counsel for the parties, the petition is allowed. And, with consent of learned counsel for the parties, Mr. U. K. Jalali, Sr. Advocate, High Court of Jammu & Kashmir and Ladakh, Jammu, is appointed as the sole arbitrator. Who shall proceed with the matter in accordance with the provisions of the Act. And to make an award within the time provided in the Act itself after charging the prescribed fee along with incidental expenses to be shared by the parties. The respondents are at liberty to raise all the objections as regards the subject matter before the learned Arbitrator. 08. Registry to send a copy of this order to the learned arbitrator. (ARUN PALLI) CHIEF JUSTICE Srinagar 31.10.2025 Abdul Qayoom, Secy. Abdul Qayoom Lone I attest to the accuracy and authenticity of this document 04.11.2025 12:13