The main legal point established in the judgment is that the appointment of a new co-arbitrator must be in accordance with the specific provisions of the agreement, joint memo, or court order, and the absence of such provisions would render the appointment impermissible.

P.B. Bajanthri, J.

1. Application is under Section 15(2) of the Arbitration and Conciliation Act, 1996 (for short the Act) read with Section 151 of the Code of Civil Procedure, 1908. Applicant has sought for the following reliefs:

(i) Confirm the nomination of Mr. G.C. Tallur as the applicant's nominee to the Arbitration Proceedings pending between the parties to the present application.

(ii) To pass such other orders, it may deem fit to grant in the facts and circumstances of the case, in the interests of justice and equity.

2. The applicant Shapoorji Pallonji and Company Private Limited is a company incorporated under the Companies Act, 1913. The applicant are into the construction company in India providing services to Corporation's, Governments and International Clients across various sectors (for short applicant). The respondent AECOS Limited is a company incorporated under the laws of NEBADA in U.S.A. The respondent is engaged in the business of design, engineering, procurement, construction, commissioning and management (for short respondent).

3. A.P.I.M. No. 1/2016 was disposed on 27.02.2017 in terms of a joint memo filed by the claimant no. 1 applicant and respondent. Para 4 of the joint memo which empowers the arbitrators of the respective party to appoint the presiding arbitrator preferably from Bengaluru. Claimant no. 1 applicant appointed Mr. Ajith B. Pawar, former Secretary of the Government of Maharashtra as its arbitrator. Similarly, respondent's nominee appointed its arbitrator as Hon'ble Mr. Justice A.K. Patnaik (retired).

4. The aforesaid arbitrators appointed Justice N. Santosh Hegde, Retired Supreme Court Judge as presiding arbitrator. When the proceedings commenced, claimant no. 2 intended to come on record and it was opposed by the respondent it was ordered by the presiding arbitrator that leaving open the claimant no. 2's grievance. When things stood thus, claimant no. 1's arbitrator Mr. Ajith B. Pawar died. In this background, Applicant intends to appoint his substitute arbitrator one Mr. G.C. Tallur. This was communicated to the respondent as well as to Justice N. Santosh Hegde and Justice A.K. Patnaik. The respondent took a serious objection to the extent that Mr. G.C. Tallur cannot step into the arbitrator of applicant, as it violates para.4 of the joint memo read with agreement with the joint venture company. Even respondent opposed to implead the joint venture company. Thus, respondents did not accept the nomination of Mr. G.C. Tallur, Former Secretary, PWD and Government of Karnataka as the nominee arbitrator. The substitution of an arbitrator will have to be only in accordance with the rules applicable. Thereafter, certain correspondence was in vogue among claimant, respondent, Presiding Arbitrator, Arbitrator of the respondent and Mr. G.C. Tallur relating to appointing Mr. Tallur as arbitrator of applicant. On 27.07.2018, respondents communicated their objection in appointing Mr. G.C. Tallur as arbitrator of applicant. The respondents have taken the following contentions before the Presiding Arbitrator which reads as under:

(a) The nomination of late Mr. Ajit Pawar was done specifically with the consent of the Respondent. The consent was recorded in the Joint Memo dated 27 February 2018. The language employed in the Joint Memo at Clause 4 makes this apparent. The parties to the Joint Memo were the Claimant No. 1 and the Respondent alone.

(b) The Joint Memo was taken on record by the Hon'ble High Court Karnataka on 27 February 2018 and forms part of the order passed by the Hon'ble High Court of Karnataka. The parties were directed to abide by the terms of the Joint Memo. The Hon'ble Arbitral Tribunal was thus constituted pursuant to the orders passed by the Hon'ble Karnataka High Court.

(c) The procedure for constitution of the Hon'ble Arbitral Tribunal was at complete variance with the arbitration clause contained at clause 11 of the JV agreement.

Presiding Arbitrator forwarded a mail which rea