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2014 Supreme(Cal) 705

High Court of Judicature at Calcutta
I.P. MUKERJI, J.
Ram Chandra Rungta
Versus
Ram Swarup Rungta & Others
A.P.No. 662 of 2010 (Original Side)
Decided on : 02-12-2014

Advocates Appeared:
For the Petitioner:Pratap Chatterjee, Sr. Adv., Samrat Sen, Paritosh Sinha, K.K. Pandey, Sourav Gupta, Advocates.
For the Respondent:R1 to R4, Chayan Gupta, Nairita Dutta Chowdhury, Advocates.

Judgment :

I.P. Mukerji, J.

The Arbitration and Conciliation Act, 1996 contains some very remarkable provisions, like sections 14 and 15. In this case, only section 14 has been invoked by the petitioner. It stipulates the circumstances in which an arbitrator’s mandate is terminated. ‘De facto’ he becomes incapable of acting or ‘de jure’ he is unable to act. Or he unduly delays matters.

There is another provision in the Act which is relevant in this case. It is Section 15. It inter alia supports the contention that if an arbitrator is required to make an award within a particular time, his mandate is terminated by efflux of that time. That section has not been invoked in the cause title of this application, though, there are enough averments in the petition to show that a case under this section has also been made out.

On 9th May, 2006 an agreement was made between the petitioner and the first, second, third and fourth respondents. They are members of one family. They had several disputes amongst themselves relating to ownership and control of companies, joint family businesses, partition of joint family properties and so on. They appointed the fifth respondent as the arbitrator to resolve them. The arbitrator was named in this agreement.

Clause 15 of it stated that the arbitrator would make his award within a period of four months from the date of service of a copy of this agreement upon him. The arbitrator would have the power to extend the time from time to time with the consent of all the parties. That time expired on 8th September, 2006.

There is absolutely no dispute that this period of four months has long expired. Except a few sittings, nothing has happened before the arbitrator. Mr. Sen, learned Advocate for the petitioner submits that his client, not having extended the time period of four months, the authority of the arbitrator has been terminated by efflux of time. This court should make this declaration. He submits that this authority expired after 8th September, 2006.

Mr. Chayan Gupta, learned Advocate appearing for the above respondents has made submissions with great candour. He has taken just one point. It is waiver. He argued that in December 2006 several sittings were held by the arbitrator. These sittings were held after the expiry of time for making the award provided in the agreement. Therefore, the petitioner can be said to have waived his above right under the agreement.

The provision regarding waiver is contained in section 4 of the said Act. It is in the following terms:

“Waiver of right to object. – A party who knows that -

(a) any provision of this Part from which the parties may derogate, or

(b) any requirement under the arbitration agreement, has not been complied with and yet proceeds with the arbitration without stating his objection to such non-compliance without undue delay or, if a time limit is provided to stating that objection, within that period of time, shall be deemed to have waived his right to so object.”

Now, the facts need to be analysed.

They are very important for adjudication of this matter.

It appears from the documents appended to the affidavit-in-opposition affirmed by Ram Swarup Rungta on 16th December, 2010 that after execution of the above agreement a series of meetings was held by the parties and the arbitrator on 4th, 5th and 6th December 2006. It was after the expiry of the time stipulated by the agreement for making and publishing the award. These meetings were nothing of the kind held by specialist arbitrators to resolve legal disputes between the parties.

Business affairs were discussed. The parties put forward the facts and figures regarding their businesses. It appears that a general and informal discussion was held between the parties and the named arbitrator. Mr.Sen submitted that since these meetings were held after expiry of the time for the arbitrator to make and publish the award, they were of no moment or consequence. On expiry of the time the mandate o















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