The main legal point established in the judgment is the principle of waiver of time stipulation in an arbitration agreement, based on the conduct of the parties during the arbitration proceedings.

The petitioner has sought a declaration that as per the provisions of the arbitration agreement dated 13.12.1996, the mandate of the learned arbitrator, Respondent no.2 stood terminated as a result of efflux of time and that the learned arbitrator had become functus officio.

2. Respondent no.2 is the arbitrator and therefore only a formal party. The reference in this judgement to the Respondent will therefore be to Respondent no. 1.

3. That the time for making the award stipulated in the arbitration agreement has expired is admitted. The question is whether the petitioner had waived the condition stipulating the time within which the award was to be made. The determination of this question in turn raises the question as to when the arbitrator entered upon the reference for that is the starting point mentioned in the agreement for computing the period within which the award is to be made. Mr. Bharucha, the learned senior counsel appearing on behalf of the Respondent submitted that the arbitrator entered upon the reference on 19.4.2002. In the alternative he submitted that the arbitrator entered upon the reference on 28.5.2002. In the further alternative he submitted that the arbitrator entered upon the reference on 28.6.2002. Mr. Kamdar, the learned senior counsel appearing on behalf of the petitioner, on the other hand submitted that the arbitrator entered upon the reference on 16.10.2002. As I will demonstrate, irrespective of when the arbitrator is deemed to have entered upon the reference, the petitioner had waived the stipulation in the arbitration agreement as to the time within which the award is to be made. However as the matter has been argued on the basis of all these dates and submissions have been made on the basis of the arbitrator having entered upon the reference on each of these dates I will deal with the same.

4. The Respondent invited tenders for certain work. The petitioner was the successful tenderer. A work order dated 4.10.1996 was issued in favour of the petitioner. A formal agreement dated 13.12.1996 was entered into between the petitioner and the Respondent, clause 91 (b) whereof reads thus : -

"The award shall be made in writing and published by the Arbitrator within two years after entering upon the reference or within such extended time not exceeding further twelve months as the Sole Arbitrator shall by a writing under his own hands appoint. The parties hereto shall be deemed to have irrevocably given their consent to the Arbitrator to make and publish the award within the period referred to hereinabove and shall not be entitled to raise any objection or protest thereto under any circumstances whatsoever."

5. Disputes and differences having arisen between the parties the petitioner requested the Respondent to appoint an arbitrator. According to the petitioner the Respondent failed to do so in terms of the arbitration agreement. The petitioner therefore on 22.6.2000 filed Application No. 75 of 2001 under section 11 of the Arbitration and Conciliation Act, 1996. Thereafter Respondent no.1 appointed its executive director, Respondent no. 2 as an arbitrator. According to the petitioner the appointment was contrary to law. By an order dated 23.2.2001 in the above application Respondent no.2 was appointed. With the petitioner's grievance against this order I am not presently concerned.

6. At the first meeting before the arbitrator on 22.1.2002 formal directions regarding pleadings were passed. At the second meeting held on 19.4.2002 the petitioner moved an application under section 16 of the said Act contending that the appointment of the sole arbitrator was bad in law and that therefore he could not continue the arbitration proceedings. It was the petitioner's contention that the respondent not having appointed the arbitrator within thirty days of the request for the appointment of the arbitrator the subsequent appointment of Respondent no.2 is bad in law and that Respondent no.2 has no ju