An arbitrator cannot rely on his personal knowledge to make an award without giving the parties an opportunity to respond, as this constitutes legal misconduct and vitiates the award.

1. THE petitioner in this application under Section 34 of the Arbitration and Conciliation Act, 1996 (hereafter the Act) calls in question an award dated May 16, 2007 of the arbitrator, which was made in relation to the dispute between the parties arising out of hiring of premises no.13, Camac Street, Kolkata (hereafter the said premises) by the respondent no.1.

2. THE 6th, 7th, 8th and 9th floors of the said premises (hereafter the leasehold area) were let out in favour of the respondent no.1 at a monthly lease rental of Rs.22,224/- for a term of two years w.e.f. December 1, 1971 in pursuance of a deed of lease of even date executed by and between the petitioner and the President of India. The deed contained a condition for renewal. Despite expiry of two years w.e.f. December 1, 1971, the respondent no.1 did not seek renewal of the lease. It also did not vacate any portion of the leasehold area. The lease rent was also not increased.

The lease deed provided for arbitration in the event of disputes and differences arising between the parties. The power to appoint arbitrator rested with the Secretary, Government of India, Ministry of Defence.

3. DISPUTES and differences having arisen between the parties, the Secretary, Government of India, Ministry of Defence on November 26, 1982 appointed Mr. K. Anantharaman, Additional Director General, Defence Land and Cantonments as arbitrator. The petitioner claimed de-hiring of the leasehold area and revision of rent in respect thereof at the market rate for the period from December 1, 1975 as also mesne profit.

4. THE arbitrator made his award on March 30, 1984. The claim of the petitioner for de- hiring was rejected. However, the arbitrator allowed revision of rent at fresh rates from June 1, 1977 till June 11, 1984 and also directed payment of interest. It was further observed by the arbitrator that rent w.e.f. June 12, 1984 may be determined in terms of Government of India, Ministry of Defence's letter dated June 2, 1984.

Feeling aggrieved by the award, the petitioner challenged the same by filing an application under Sections 30 and 33 of the Arbitration Act, 1940 before this Court, giving rise to Matter No.777/1985. The application was allowed by judgment and order dated January 25, 1990. The respondent no.1 carried the same in appeal, giving rise to Appeal No.65 of 1990. By judgment and order dated November 12, 1998, the Division Bench of this Honourable Court was pleased to dispose of the said appeal by setting aside the impugned award in so far as it related to the right of the petitioner to claim rent at enhanced rate for the period subsequent to June, 1984 as also the petitioner's right to claim municipal rates and taxes. The Division Bench was further pleased to direct the Secretary, Ministry of Defence to appoint an arbitrator in terms of the arbitration agreement between the parties for deciding the disputes with regard to the claim of the petitioner for enhancement of rent in respect of the leasehold area for the period subsequent to June, 1984. The arbitrator was required to decide the dispute, in terms of the said order, within a period of 4 weeks from the date of entering on the reference.

5. AN application for modification of the appellate order followed at the instance of the petitioner. The said application was disposed of by judgment and order dated May 19, 2000 without granting modification as prayed for.

6. DESPITE direction of the Division Bench dated November 12, 1998, no arbitrator was appointed. Ultimately, an application under Section 11 of the Act was filed by the petitioner before this Court giving rise to A.P. No.408 of 2006. During its pendency, the petitioner was informed of appointment of Sri V.K. Srivastava, Additional Director General, Defence Estate as the sole arbitrator.

It is not in dispute that the arbitrator, newly appointed, apart from receiving from the petitioner its statement of claim and from the respondent no.1 letters dated January