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In the High Court of Bombay at Nagpur
ANOOP V. MOHTA, J.
Abhijeet Infrastructure Ltd. & Others
Versus
State of Maharashtra & Others
Miscellaneous Civil Application (Arbitration) Nos. 142 of 2012, 791 of 2012 & 1090 of 2012
Decided on: 05-07-2013
When the scheme was framed it was probably on the foundation that the order would be administrative order and therefore certain costs or process fee is required to be paid by the applicant. But now if it is a judicial order [in view of 2006 (1) All MR 156 (SC)] and even otherwise, parties are entitled to invoke Section 11 of the Arbitration Act, the requisite Court fee and/or process fee need to be paid and/or deposited by the parties as per the respective rules. The question is requirement of direction to deposit the costs for processing.
Section 89 of Code of Civil Procedure also provides for appointment of arbitrator by Court being one of the alternative mode of settlement of dispute pending in the Court. There is nothing to show that such costs and/or process fee is required to be paid by the parties in those proceedings. Though scheme is different yet, the costs for processing for appointment of Arbitrator under Section 11 of the Arbitration Act is not contemplated under the Arbitration Act and/or even under the Court Fee Act and/or any specific rules except the Scheme of 1996, which had been framed prior to the judgment in S.B.P. & Co. case and not amended till date.
However, it is made clear that as on today, unless pointed out otherwise and as there is no challenge at any point of time to the orders passed by the Court directing the parties to deposit the process fee and as most of the parties have complied it, it cannot be said that the same is illegal and/or impermissible. However, an immediate attention is required from all sources to bring in force common scheme and/or rules to avoid further complications in the matter apart from delay in constituting the Tribunal for want of deposit of such process fee.
Since the identical issue arises in these miscellaneous civil applications, these applications are heard finally with the consent of the learned counsel for the parties.
These are applications under Section 11 of the Arbitration and Conciliation Act, 1996 (for short ‘Arbitration Act’), whereby applicants pray to appoint arbitrator pursuant to their agreements as the other side has failed to take steps and/or appoint arbitrator though demanded within prescribed period/time. In all these matters after hearing both the parties, the designate Judge has allowed the applications and appointed the arbitrators. However, all the applicants have been directed to deposit the process fee ranging from Rs.5,000/- to Rs.7,500/- in the respective matters.
2. In Miscellaneous Civil Application No.142/2012 order is dated 12.10.2012, in Miscellaneous Civil Application No.791/2012 order is dated 05.04.2013 and in Miscellaneous Civil Application No.1090/2012 order is dated 03.05.2013 by which, directions were issued to the applicants to deposit the process fees. In Miscellaneous Civil Application No.791/2012, both the parties have invoked Section 11 of the Act of 1996 arising out of same contract and the same arbitration clause between the parties. The Arbitrator has been, in fact, appointed by the consent of the parties. The learned counsel appearing for the parties, when inquired, referred the scheme for the “Appointment of the Arbitrator by Chief Justice of India Scheme, 1996 (published on 29.01.1996) which was in pursuance to subsection 10 of Section 11 of the Arbitration Act. The relevant clause is Clause 12, which is reproduced as under:
“12. Costs for processing requests.– The party making a request under this Scheme shall, on receipt of notice of demand from
(a) the Registry of the Court, where the Chief Justice makes the appointment of an arbitrator or takes the necessary measure, or
(b) the designated person or the institution, as the case may be, where such person or institution makes appointment of arbitrator or takes the necessary measure, pay an amount of Rs.15000/- in accordance with the terms of such notice towards the costs involved in processing the request.”
3. The similar scheme is also framed by the Chief Justice of Bombay High Court, which is referred as Appointment of Arbitrators by the Chief Justice of Bombay High Court Scheme, 1996 (published on 06.04.1996), which was also in pursuance to subsection 10 of Section 11 of the Arbitration Act. The relevant clause is Clause 12, which is reproduced as under:
“12. Costs for processing requests -
The party making a request under this Scheme shall, on receipt of notice of demand from, –
(a) the Registry of the Court, where the Chief Justice makes the appointment of an arbitrator or takes the necessary measure; or
(b) the designated person or the institution, as the case may be, where such person or institution makes appointment of arbitrator or takes the necessary measure; pay an amount not less than of Rs.3,000/- and not more than Rs.10,000/- as may be determined by the Chief Justice, in accordance with the terms of such notice towards the costs involved in processing the request.
4. Sub-Section 10 of Section 11 of the Arbitration Act provides for framing of such scheme and/or rules or regulations. There is nothing to show in the Act, whereby parties/applicants are liable to pay costs for processing request. The scheme was framed in the year 1996 principally along with the Arbitration Act which is brought into force on 28.08.1996. The scheme so referred has been framed even before the Arbitration Act brought into force. There is no other provision under the Act which deals with payment of costs for processing request and/or even for the Court fees. The respective rules of respective Courts based upon the Court Fees Act Central as well as State Act provide for requisite Court fee and/or process fee for filing any application in the Court and/or before the appropriate
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