The need for specific instances of bias and the option to challenge the final award under Section 34 of the Arbitration & Conciliation Act, 1996.

V. KAMESWAR RAO, J.

IA 2133/2016 in O.M.P. (T) (COMM.) 7/2016 and IA 2135/2016 in O.M.P. (T) (COMM.) 8/2016 (filed by petitioner seeking exemption from filing certified copies, dim annexures and typed copies of documents) Exemption allowed subject to all just exceptions.

Applications stand disposed of.

O.M.P. (T) (COMM.) 7/2016 & O.M.P. (T) (COMM.) 8/2016

1. These petitions under Section 14 of the Arbitration & Conciliation Act impugnes order dated September 25, 2015 received by the petitioner on October 23, 2015 passed by the learned Arbitrator whereby the learned Arbitrator has rejected the application filed by the petitioner herein, in two proceedings i.e. Claim Petition No. 1/2015, (M/s Olympic Oil Industries Ltd vs. M/s Shiv Vani Oil and Gas Exploration Services Ltd) and Claim Petition No. 03/2015, i.e. Comet Overseas Pvt. Ltd. vs. M/s Shiv Vani Oil and Gas Exploration Services Ltd challenging the jurisdiction of the Tribunal in terms of Section 12, 13 & 14 of the Arbitration & Conciliation Act, 1996 read with Section 23 and 24 of the Indian Contract Act, 1872.

BRIEF FACTS:-

2. The primary challenge of the petitioner in this case, is that the arbitration clause, which empowers the respondent No.1 to unilaterally appoint an Arbitrator is void to the limited extent that under Section 23 of the Indian Contract Act, such clause should be read down to constitute an independent Arbitral Tribunal. Otherwise, for all practical purposes, judicial remedy will become illusionary, and this will lead to strong arm tactics by stronger parties against the weaker parties and this unilateral appointment should be deemed to fall under the bar of newly inserted Section 12 (1) directly or indirectly to give rise to justifiable doubts as to the Arbitrator’s independence. Learned counsel for the petitioner would rely upon the following judgments:-

(i) (2012) 2 SCC 759 Denel (Proprietary) Limited vs. Ministry of Defence;

(ii) (2012) 6 SCC 384 Bipromasz Bipron Trading SA vs. Bharat Electronics Limited (BEL);

(iii) 2013 AD (Delhi) 162 MFAR Construction Pvt. Ltd. (M/s) vs. Director General (Married Accommodation Project);

(iv) 2008 (1) Arb L.R 393 (Delhi) Alcove Industries Ltd. vs. Oriental Structural Engineers Ltd and Anr.;

(v) Judgment dated April 15, 2004 of this Court in Arb. Petition No. 377/2012, Indo Arya Logistics vs. Central Warehousing Corporation.

3. He would also state, that even though the present proceedings have been initiated, much before the amendment act has come, the amendments so inserted need to be followed in these proceedings and in that regard, he would rely upon the judgment of the Supreme Court reported as 1999 (6) Scale 441 Thyssen Stahlunion GMBH vs. Steel Authority of India Ltd.

4. On the other hand, leaned counsel for the respondent No.1 would state that the petitioner is precluded from challenging the clause relating to arbitration wherein the power to appoint Arbitrator has been vested with the respondent No.1 only on the ground that the said agreement was entered with open eyes by the petitioner and if there is an apprehension of bias of the learned Arbitrator, the petitioner was within its right to file an application under Section 12, 13 and 14 of the Arbitration & Conciliation Act, which in fact was invoked, resulting in the impugned order.

5. It is his submission, that an apprehension of the petitioner is without any basis and has rightly been rejected as the apprehension must be based on cogent material. In this regard, he would rely upon the judgments of this Court in 2013 II AD (Delhi) 460 Priknit Retails Ltd. vs. Aneja Agencies; AIR 1988 SC 2232 Secretary to Government, Transport Deptt., Madras vs. Munuswamy Mudialiar & Anr.; AIR 2007 SC 1764 Ace Pipeline Contracts Pvt. Ltd. vs. Bharat Petroleum Corpn. Ltd.; AIR 2012 SC 817 Denel (Proprietary Ltd.) vs. Govt. of India, Ministry of Defence. He would state the petitioners cannot wriggle out of the Arbitration Clause only on an apprehension that a pers