IN THE HIGH COURT OF BOMBAY
D.K. Deshmukh, J.
Cotton Corporation of India Ltd...... Petitioner.
Versus
Sharad Shetkari Soot Girni Niyamit..... Respondent.
Arbitration Petition No. 214 of 1999, decided on 23-12-1999.
Advocates appeared :
Bipin Gandhi, for petitioner.
Girish Godbole, for respondent.
2.The learned counsel for the petitioner first submits that the appointment of Shri Chari as an Arbitrator was contrary to the provisions of the Act and therefore, according to the learned Counsel, the award passed by the Arbitrator is liable to be set aside. He relies on the provisions of sections 2(e), 8, 11 of the Act as also Clause 10.2 of the agreement between the parties. The learned Counsel appearing for the respondent, on the other hand, submits that under section 8 of the Act, as a judicial authority, the learned Civil Judge, Senior Division, Solapur can refer the parties to arbitration and the parties were free by consent to appoint any person as an Arbitrator. The learned counsel submits that the petitioner themselves went to the Court and made an application, requesting that Shri Chari should be appointed as an Arbitrator, the respondent acceded to that request and therefore, Shri Chari was appointed as an Arbitrator. According to the learned Counsel, therefore, in substance the appointment of Shri Chari as an Arbitrator is not made by the Civil Judge, Senior Division, Solapur but by both the parties by consent. He submits that as the appointment of Shri Chari as an Arbitrator was made by consent, there is no question of provisions of section 11 coming into play. The learned Counsel submits that though Clause 10.2 of the agreement between the parties provides for appointment of Arbitrator by the Chairman-cum-Managing Director of the respondent, it is clear from Clause 11.4 of the agreement that parties are free to modify or vary the terms of the contract by mutual consent. The learned counsel submits that the proceedings before the Civil Judge, Senior Division, Solapur clearly show that the parties to the contract viz. the petitioner and the respondent modified Clause 10.2 of the agreement when they mutually agreed to appoint Shri Chari as Arbitrator. The learned counsel therefore submits that there is nothing illegal or even irregular in the appointment of Shri Chari as an Arbitrator.
3.Now if in the light of these rival submissions, the record of the case is perused, it becomes clear that according to Clause 10.2 of the agreement between the parties, the disputes or differences between the parties were to be referred to arbitration of an Arbitrator to be appointed by the Chairman-cum-Managing Director of the respondent. Clause 11.4 provides that the parties can by agreement vary or modify any of the terms of the contract. The respondent filed a suit for a money decree against the petitioner. In that suit, the petitioner on its own made an application for referring the dispute to the arbitration and suggested the name of Shri Chari as an Arbitrator. It is clear from the order passed by the Civil Judge, Senior Division, Solapur dated 26th September, 1997 that this application was not opposed by the respondent. This clearly means that the respondent not only agreed to the referring of the dispute raised in the suit to an Arbitrator but they also consented to the appointment of Shri Chari as an Arbitrator. Perusal of the provisions of section 8 of the Arbitration Act shows that a judicial authority, before which an action is brought in a m
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