High Court Of Delhi
SANJIV KHANNA
DHARAM PRAKASH - Appellant
Versus
UNION OF INDIA - Respondents
WRIT PETITION (CIVIL) 16003 Of 2006
Decided On : 02/08/2007
Sections 13(3), 13(4), 13(5) & 34 - Validity of - Challenge to the provision being violative of Articles 14 & 21 of -Constitution of India on the ground that there is no provision for removal of arbitrator after his appointment - Bias of arbitrator, available as one of the . grounds to challenge the• arbitration award u/s 34 of the Act Enactment of Act on the basis of Model Law adopted by United Nations - Challenge to the provisions of the Act held not sustainable - Provisions of the Act held to be legal and constitutional.
[Para 6]
MUKUNDAKAM SHARMA, CJ.
( 1 ) BY filing this petition, the petitioner has challenged the constitutional validity of the provisions of Section 13 (4) and Section 34 of the Arbitration and Conciliation Act, 1996 as being violative of Articles 14 and 21 of the constitution of India.
( 2 ) IN the writ petition, the petitioner has incorporated an additional prayer for issuance of a direction to the respondents No. 1 and 2 to club the cases of similar nature to be decided by the same Arbitrator preferably by a retired judge of this court rather than giving these matters for adjudication to different Arbitrators. The writ petition is contested by both Union of India and Mahanagar Telephone Nigam Limited.
( 3 ) WE have also heard the learned counsel appearing for the parties on the aforesaid pleas.
( 4 ) IT is submitted on behalf of the petitioner that there are six different contracts and that the said contracts revolve around similar issues of facts and law and, therefore, the said issue should have been referred to a sole arbitrator instead of referring the same to different Arbitrators. The next submission of the counsel appearing for the petitioner was that the provisions of Section 13 and Section 34 are ultra vires to the Constitution of India. In order to buttress this contention, the counsel particularly referred to sub-section (4) of Section 13 and sub-section (5) of Section 13. According to the counsel, Section 13 does not provide for court intervention during the arbitration proceeding in the event of a negative decision of the Arbitral tribunal on a challenge to an Arbitrator. The submission was that even when there is a challenge to the appointment of an Arbitrator, in that event also the arbitrator would continue the arbitral proceedings even in case of negative decision and that he would make an arbitral award and only thereafter the challenging party would be able to file an objection before a court only as a regular action for setting aside the award as provided for under Section 34 of the Arbitration and Conciliation Act. Next submission was that even under section 34 of the Act, no specific provision has been made to file an objection against an action of the aforesaid nature in the event of negative decision by the Arbitrator.
( 5 ) WE have considered the aforesaid submission of the learned counsel for the petitioner. It is to be noted that the aforesaid Act is enacted mainly in the pattern of the Modern Law adopted by the United Nations Commission on international Trade law. The object and the reasons of the Act clearly indicate that the intention of the Act is to lay emphasis on speedy disposal of arbitration proceedings. The Act also seeks to minimise judicial intervention in the progress and completion of arbitration proceedings, which is crystal clear from a bare reading of Section 5 of the Act which provides that no judicial authority would intervene except where so provided in the Act. Consequently, the bar on court interference on challenging the arbitral tribunal during the pendency of the arbitration proceeding was meant to minimise judicial intervention at that stage as any interference at that stage would be against the spirit with which the Act was enacted. Sub-section (5) of Section 13 of the act lays down that challenging an arbitral award is permitted even on the grounds taken by the aggrieved party on which the challenge to the arbitral tribunal was made. There is no provision in the Act which would enable the court to remove an Arbitrator during the arbitration proceedings. But, at the same time the party having grievance against an Arbitrator cannot be said to be without a remedy and the said remedy becomes available as soon as the arbitral award is made by the Arbitrator or the arbitral tribunal. A similar challenge to the provisions of Section 13 was made in the Delhi High Court in the case of bharat Heavy Electricals Ltd. v. C. N. Garg and Ors. reported as 2001 (57) DRJ 154 (DB ). In the s
REFERRED TO : Bharat Heavy Electricals Ltd. v. C.N. Garg and Ors.
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