The main legal point established in the judgment is the mandatory duty of an arbitrator to disclose any circumstances likely to give rise to justifiable doubts as to his independence or impartiality, as per Section 12 of the Arbitration and Conciliation Act, 1996.

JUDGMENT - D.K. DESHMUKH, J.:---This is a petition filed under section 34 of the Arbitration and Conciliation Act, 1996 for setting aside the award dated 15th April, 1999. The facts that are relevant and material for deciding this petition are that the parties had entered into a charter party agreement dated 19th May, 1995 whereby the respondent chartered their vessel M.V. Prabhu Gopal to the petitioners to carry certain goods. The vessel discharged at two ports, the first was Vishakhapatnam where the vessel discharged part of the goods. The vessel discharged at the second port being Haldia, the balance of the goods. According to the respondents the vessel incurred demurrage charges at the discharge port for which the respondents made a claim amounting to Rs. 1,08,00,431/-. On this amount of demurrage charge, dispute arose between the parties.

2. In the agreement between the parties there was an arbitration clause. Therefore the disputes were referred to arbitration under the Act. The respondents invoked the arbitration clause and appointed Shri K.P. Patel as their arbitrator and also appointed Messrs Bhatt Saldanha, as Advocates to represent them in the arbitration proceedings. The petitioners appointed Ms. J.K. Bhatt as their arbitrator and the two arbitrators appointed Mr. N. Sukumaran as the Presiding Arbitrator.

3. During the pendency of this arbitration proceedings the petitioners came to know that the son of Shri K.P. Patel, the arbitrator appointed by the respondents, was a partner in the firm of Messrs Bhatt Saldanha, who were representing the respondents before the arbitrators. According to the averments in the petition they came to know of this fact on 5th February, 1999. They entered into correspondence with Messrs Bhatt Saldanha for confirmation of this fact and when the fact was confirmed that the son of arbitrator Shri K.P. Patel is a partner of Messrs Bhatt Saldanha, which was representing the respondents before the arbitrators the petitioners filed an application under sections 12 and 13 of the Act challenging the appointment of Shri K.P. Patel, as an arbitrator. That application was opposed by the respondents and the said application came to be decided by an order dated 23rd March, 1999.

4. In the proceedings for deciding the application Shri Patel did not take part but he signed the order rejecting the application. As the application was rejected further proceedings took place and finally an award was made by the arbitrators directing the petitioners to pay the amount of claim made by the respondents with interest. In the present petition the order passed the application under sections 12 and 13 of the Act as also the final award are challenged.

5. There is no dispute before me that son of Shri Patel, the arbitrator, is a partner in the firm of Advocates which represented the respondents before the arbitrator. The learned Counsel appearing for the petitioners submits that section 12 of the Act casts a duty on an arbitrator to disclose in writing any circumstance likely to give rise to justifiable doubt as to his independence or impartiality. According to the learned Counsel therefore a duty is cast on the arbitrator to disclose to the parties to the arbitration in writing any circumstance likely to raise justifiable doubts as to his independence. According to the learned Counsel Shri Patel, the arbitrator was duty bound to disclose to the parties to arbitration that his son is a partner in the firm of Advocates which represented the respondent before him. According to the learned Counsel the failure of Shri Patel to disclose this information amounts to breach of a statutory duty imposed on the arbitrator by section 12 of the Act. According to the learned Counsel section 12 of the Act incorporates a procedural safeguard. The duty imposed on the arbitrator to disclose is a mandatory duty and failure of Shri Patel to do so vitiates the entire arbitration proceedings. In support of his submission learned Co

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