The court emphasized the importance of arbitrators fulfilling the requirements of independence and impartiality as per the Act, and held that objections to the arbitrators' appointments could only be raised after the pronouncement of the award.

Rajiv Shakdher, J.

Caveat No. 999/2014

1. Since the caveator/ respondent has entered appearance, the caveat stands discharged.

IA No. 22016/2014 (Exemption)

2. Allowed subject to just exceptions.

Arb. P. 562/2014 & IA No. 22015/2014 (Stay)

3. This is a petition filed under Section 11(6) of the Arbitration & Conciliation Act, 1996 (in short the Act), for appointment of an independent and impartial sole arbitrator for adjudication of disputes between the parties. Before I proceed further, at the very outset, it is to be noticed that, two (2) arbitrators have already rescued themselves from the matter, and presently, the third arbitrator is seized, with the matter in issue. In order to adjudicate upon the petition, the following broad facts are required to be noticed.

4. The petitioner was awarded a contract for construction of a ROB on road No. 63, at Level Crossing No.III, on Delhi-Saharanpur Railway Line (hereinafter referred to as the ‘work’), pursuant to a tender issued on 11.11.2005. Apparently, during the course of the execution of the work in issue, disputes arose as between the parties herein and, consequently, the petitioner took recourse to the arbitration mechanism encapsulated in the contract entered into between the parties. The arbitration agreement is contained, admittedly, in clause 25 of the contract.

4.1 Pursuant to letters dated 21.01.2012 and 10.02.2012, the Chief Engineer of the respondent herein, who is the designated authority, appointed an arbitrator. A communication to that effect dated 09.04.2012 was issued by the Chief Engineer. A copy of this communication was sent to the arbitrator, as well. At this point in time, the arbitrator appointed was, one, Mr V.K. Malik. Notably, the claims adverted to in the petitioner’s letter of 21.01.2012, were referred to the arbitrator for adjudication.

4.2 Amongst the various claims referred, was claim no. 5, which reads as follows: “payment for escalation in prices/ wages, pursuant to contract provision”. Importantly, this claim was valued by the petitioner at Rs. 65 lacs. The Chief Engineer referred this claim, along with other claims, for the value indicated by the petitioner.

4.3 Pertinently, Mr V.K. Malik was replaced by the Chief Engineer, with one, Sh. S.R. Pandey, ADG (Retd.), CPWD, as the sole arbitrator vide communication dated 24.04.2012. The claims referred to Sh. S.R. Pandey were the same as those which were referred to the earlier arbitrator, i.e., Mr V.K. Malik. The record, as filed before me by the petitioner, shows that Sh. S.R. Pandey held the hearing on 19.05.2012, where both parties were represented. The learned arbitrator on that date, evidently, fixed a time schedule within which pleadings had to be filed and admission/ denial of document had to take place. The order sheet seems to indicate that parties had agreed that the next hearing in the matter would take place after pleadings were filed and, admission/ denial of documents was carried out.

4.4 As a consequence of the directions passed on 19.05.2012, the petitioner herein (i.e., the original claimant), under the cover of its letter dated 18.06.2012, filed its statement of claims with the learned arbitrator, i.e., Mr S.R. Pandey, with a copy to the respondent herein.

4.5 The statement of claims, so filed by the petitioner, included claim no.5 and, as indicated to the Chief Engineer of the respondent in its letter dated 21.01.2012, it continued to be valued at Rs. 65 lacs. In response to the petitioner’s statement of claims, a statement of defence was filed by the respondent on 17.08.2012.

4.6 In rebuttal, the petitioner also filed a rejoinder, when for the first time, the petitioner, evidently, sought to indicate that the valuation made qua claim no.5, was subject to detailed reconciliation after receiving complete details of the measurement book (MB). It was also averred that the claim was subject to upward increase in view of “merits and intent of the contract”.

4.7 Apparently, on 1