SupremeToday Landscape Ad
Back
Next
Judicial Analysis Court Copy Headnote Facts Arguments Court observation
Listen Audio Icon Pause Audio Icon
judgment-img

2021 Supreme(AP) 941

IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI
C. PRAVEEN KUMAR, B. KRISHNA MOHAN, JJ.
B.S.N. Joshi and Sons Limited – Appellant
Versus
Rashtriya Ispat Nigam Limited and Ors. – Respondent
Civil Revision Petition Nos. 3142 of 2019 and 3148 of 2019
Decided On : 02-09-2021

Advocates:
Advocate Appeared:
For the Appellant : V.R.N. Prashanth
For the Respondents: W.B. Srinivas

Headnote:

Constitution of India, 1950 - Article 226 - Arbitration and Conciliation Act, 1996 - Section 12(2), 12(5), 13, 14(2), 34 - Petitioner filed an application under Section 14(2) of Arbitration and Conciliation Act, 1996 before Commercial Court questioning constitution of Arbitral Tribunal with 2nd Respondent as its Sole Arbitrator by 1st Respondent, as illegal and violative of provisions of Act - Whether petition under Section 14(2) of Act seeking termination of mandate of arbitrator before court is maintainable, when such a challenge was rejected by tribunal under Section 13(2) – Held, once authority/person/employee who falls under Seventh Schedule is ineligible to act as an arbitrator, such ineligible person could not have appointed another as an arbitrator, since, such appointment goes to root of matter - Only exception is that parties "after arising of disputes" shall agree for such recourse, which is lacking in present case - Appointment of 2nd Respondent by 1st Respondent is void by operation of law in terms of Section 12(5) read with Seventh Schedule - Civil Revision Petition allowed.

ORDER :

C. Praveen Kumar, J.

1. Civil Revision Petition No. 3142 of 2019 is filed by the Petitioner, aggrieved by the Order of the Special Judge for Trial and Disposal of Commercial Disputes at Visakhapatnam in G.R. No. 133 of 2019, dated 03.06.2019, while Civil Revision Petition No. 3148 of 2019 is filed challenging the extension of time for passing the award in C.A.O.P. No. 18 of 2019. As both the Civil Revision Petitions are interconnected, they are disposed off by this common order.

2. The Petitioner herein filed an application under Section 14(2) of the Arbitration and Conciliation Act, 1996 ['Act'] before the Commercial Court at Visakhapatnam, questioning the constitution of Arbitral Tribunal with the 2nd Respondent as its Sole Arbitrator by the 1st Respondent, as illegal and violative of the provisions of the Act.

3. The facts, which lead to filing of the present application, are as under:

    (i) Originally, the Petitioner herein filed an application under Section 14(2) read with Fifth Schedule of the Act before the Arbitral Tribunal for termination of the mandate of the arbitrator, which was dismissed. Challenging the same, the Petitioner filed W.P. No. 46299 of 2018 before this court. By an Order, dated 12.03.2019, [to which one of us CPK, J was a member] rejected the application on the ground that the appropriate remedy for the Petitioner would be to challenge the order in the appeal filed under Section 34 of the Act, after the award is passed. It was further held that the order passed under Section 13(2) of the Act is not amenable to the extraordinary jurisdiction of the High Court under Article 226 of the Constitution of India.

(ii) Pursuant to the Order passed by the Division Bench of this court, an application under Section 14(2) of the Act came to be filed before the Commercial Court, for termination of the mandate of the Arbitrator. The Commercial Court rejected the application, primarily, on the ground that the challenge to the appointment of the arbitrator was made under Fifth Schedule and not under Seventh Schedule. The Court mainly relied upon paragraph "O" of the petition filed under Section 14, which is evident from paragraph no. 9 of the Order impugned in the present case. Apart from that, the Court also dealt with the issue as to whether an application under Section 14 can be filed before the court when once an order has been passed by the Arbitral Tribunal under Section 12(2) for the same relief and by this court exercising its jurisdiction under Article 226 of the Constitution of India. Challenging the same, these two Civil Revision Petitions are filed.

4. Heard Sri. V.R.N. Prashanth, learned Counsel for the Petitioner and Sri. W.B. Srinivas, learned Counsel appearing for the Respondents, through Blue Jeans video conferencing APP and with their consent, the Civil Revision Petitions are disposed of.

5. Relying upon the judgments in Bharat Broadband Network Limited v. United Telecoms Limited (2019) 5 SCC 755; TRF Ltd. v. Energo Engineering Projects Ltd., (2017) 8 SCC 377 and HRD Corporation (Marcus Oil and Chemical Division) v. GAIL (India) Limited (formerly Gas Authority of India Limited) (2018) 12 SCC 471 Sri. V.R.N. Prashanth, learned Counsel for the Petitioner, would contend that the order is illegal and contrary to the provisions of the Act. According to him, there is a specific plea in paragraph 'q' 't', 'u' and 'v' of the application filed under Section 14 challenging the appointment of the 2nd Respondent as arbitrator as violative of Section 12(5) read with Seventh Schedule. That being so, he submits that the finding of the Trial Court that the application was only under Fifth Schedule is erroneous. He further submits that the Trial Court was carried away by the earlier filed application under Section 12(2) read with 13 of the Act and Fifth Schedule and the orders passed therein. He further submits that since 2nd Respondent falls in one of the category specified in Seventh Schedule, he is ineligible to ac

                  Click Here to Read the rest of this document
                  1
                  2
                  3
                  4
                  5
                  6
                  7
                  8
                  9
                  10
                  11
                  SupremeToday Portrait Ad
                  supreme today icon
                  logo-black

                  An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers

                  Please visit our Training & Support
                  Center or Contact Us for assistance

                  qr

                  Scan Me!

                  India’s Legal research and Law Firm App, Download now!

                  For Daily Legal Updates, Join us on :

                  whatsapp-icon Back to top