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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
G.S. KULKARNI, ADVAIT M. SETHNA
R.B. Krishnani – Appellant
Versus
STEM Water Distribution and Infrastructure Com. Pvt. Ltd. – Respondent
JUDGMENT :
G.S. KULKARNI, J.
1. This appeal under Section 37 of the Arbitration and Conciliation Act, 1996 (for short, “ACA”) is directed against the judgment and order dated 16 May 2023 passed by the Commercial Court at Thane whereby the respondent’s application under Section 34 of the ACA for setting aside the arbitral award dated 29 September 2020 passed by the learned sole arbitrator is allowed, as aconsequence of which, the arbitral award rendered by the learned sole arbitrator stands quashed and set aside.
2. The only ground on which the arbitral award is set aside by the Commercial Court is to the effect that the learned arbitrator was the Managing Director of the respondent, hence, in view of the provisions of Section 12(5) of the ACA, he was ineligible to act as an arbitrator. Also referring to the provisions of Sections 14 and 15 of the ACA, the Commercial Court felt that on such count the arbitral award suffered a patent illegality so as to set aside the same by applying Section 34(2A) of the ACA.
3. Thus, the issue as urged in the present appeal is a pure question of law, namely: ‘when the learned sole arbitrator was appointed by consent of the parties, and who happened to
Parties can waive objections to an arbitrator's ineligibility by express agreement after disputes arise, as per Section 12(5) of the Arbitration and Conciliation Act.
Parties can waive objections to an arbitrator's eligibility by consenting to their appointment and participating in proceedings, as per Sections 12(5) and 34 of the Arbitration and Conciliation Act.
Participation in arbitration without objection constitutes a waiver of the right to challenge the appointment of the arbitrator, as per Sections 4 and 12 of the Arbitration and Conciliation Act.
Point of law: Arbitration -in the absence of an express agreement between the petitioner and the respondent subsequent to arising of disputes whereby the parties expressly agreed to waive the applica....
A unilateral appointment of an arbitrator by one party contravenes Section 12(5) of the Arbitration and Conciliation Act, rendering the arbitral award void ab initio and against public policy.
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