JUDGMENT :

Shekhar B. Saraf, J.

1. The instant application has been filed by the petitioner, West Bengal Housing Board (‘award debtor’), under Section 34 of the Arbitration & Conciliation Act, 1996 (hereinafter referred to as ‘the Act’ and/or the ‘the principal Act’) seeking to set aside an arbitral award dated December 21, 2018 passed by the sole arbitrator Mr. Santanu Basu Rai Chaudhuri.

2. The respondent in the instant application is M/s. Abhisek Construction (‘award holder’).

3. At the very outset, it would be prudent on my part to mention that the instant application has been argued on inherent jurisdictional issues pertaining to the eligibility of the arbitrator to enter reference in the first place. The petitioner / award debtor has prayed for setting of the arbitral award on the ground that the award was passed by a unilaterally appointed arbitrator. It is to be noted that the challenge under the aforesaid ground was not present when the instant application was originally filed on March 15, 2019 and becomes available subsequently due to judicial interpretations on the position of law. The said challenge was vehemently opposed by the respondent, and hence, in this judgment, I have only dealt with the point of maintainability of this Section 34 application.

Facts

4. I have mapped the factual matrix of the present lis below :

a. A notice inviting tender was issued by the respondent/award debtor for “Construction of roads with pavered blocks, driveways, pathways & open garages of M.I.G. and L.I.G. clusters of chequered tiles at Eastern High/Grove/Nook Housing Project of West Bengal Housing Board at New Town, Kolkata”. The bid of the respondent/award holder, in this regard, was accepted by the petitioner/ award debtor vide its letter dated April 30, 2010. A formal agreement in this regard was executed between the parties on May 19, 2010 and the work order was issued by the Joint Director (EW-1) of the award debtor on the same day.

b. Subsequently, on account of disputes having arisen between parties, the respondent vide letter dated March 12, 2012 addressed to the Deputy Director (EW), Eastern Housing Project, West Bengal Housing Board, Rajarhat, Kolkata raised several claims and requested the petitioner to make payment of the said claims within 15 days. On March 16, 2012, the petitioner rejected the claims raised by the respondent in the aforesaid letter.

c. By another letter dated March 28, 2012, the respondent requested the petitioner’s Director (Engineer) for appointment of an arbitrator in terms of clause 25 of the contract between the parties. The petitioner vide its letter dated April 20, 2012 nominated Shri Santanu Basu Rai Chaudhuri, retired Engineer-in-Charge, PWD and ex officio Secretary as the sole arbitrator.

d. The sole arbitrator concluded the arbitral proceedings on November 23, 2018 and published the award on December 21, 2018. The arbitrator awarded the respondent a sum of INR 41,82,385/-(Indian Rupees Forty One Lakhs Eighty Two Thousand Three Hundred Eighty Five only) along with simple interest at the rate of 10% per annum from the date of award till the date of payment.

e. On March 15, 2019, the award debtor filed the instant application challenging the aforesaid award under Section 34 of the Act.

Submissions

5. Mr. Rohit Banerjee, counsel for the petitioner/ award debtor made oral submissions and challenged the said arbitral award on the ground that unilateral appointment of the sole arbitrator is impermissible under Section 12(5) read with Schedule VII of the Act. I have reproduced his submissions below :

a. The counsel submitted that the sole arbitrator was appointed unilaterally by the award debtor at the request of the award holder. The counsel further submitted that the arbitrator lacked the inherent jurisdiction to pass the said award as he was appointed by an interested party. In light of the same, the cou