The main legal point established is the applicability of the Act as amended with effect from 23rd October 2015 and the disqualification of the appointed Arbitrator under Section 12(5) of the Act.

1. This is a petition by Ratna Infrastructure Projects Pvt. Ltd. under Section 11(6) of the Arbitration & Conciliation Act, 1996 (‘Act’) seeking the appointment of an Arbitrator to adjudicate the disputes between the Petitioner, Ratna Infrastructure Projects Private Limited and the Respondent, Meja Urja Nigam Private Limited in Arbitration Case Nos. 1 of 2013 and 1 of 2014.

2. The facts are that the Respondent is a joint venture of National Thermal Power Corporation (‘NTPC’) and Uttar Pradesh Rajya Vidyut Utpadan Nigam Limited. The Chief Executive Officer (‘CEO’) of the Respondent is the appointing authority authorized to appoint an Arbitrator.

3. The Petitioner was awarded the work of “Site Levelling and Infrastructure Works Package for Meja Thermal Power Project” (2 X 660 MW) by a letter of Award (‘LoA’) on 18th May 2010. A formal contract was entered into between the parties in respect of the aforesaid LoA on 21st September 2010. The contract has a mechanism for dispute resolution by way of arbitration. This is contained in Clause 56 of the General Conditions of Contract (‘GCC’) which reads as follows:

“56.Except where otherwise provided for in the contract all questions and disputes relating to the meaning of the specifications designs drawings and instructions herein before mentioned and as of the quality of workmanship or materials used on the work or as to any other question, claim, right, matter or thing whatsoever in any way arising out of or relating the contract designs, drawing specifications, estimates, instructions orders or these conditions of otherwise concerning the work or the execution or failure to execute the same whether arising during the progress of the work or after the completion or abandonment thereof shall be referred to the sole arbitration of the General Manager of NTPC Limited (formerly National Thermal Power Corporation Ltd.), and if the General Manager is unable or unwilling to act, to the Sole Arbitration of some other person appointed by the Chairman and Managing Director, NTPC Limited (formerly National Thermal Power Corporation Ltd.) willing to act as such Arbitrator. There will be no objection if the Arbitrator so appointed is an employee of NTPC Limited (formerly National Thermal Power Corporation Ltd) and that he had to deal with the matters to which the contract relates and that in the course of his duties as such he had expressed views on all or any of the matters in dispute or difference. The Arbitrator to whom the matter is originally referred being transferred or vacating his office or being unable to act for any reason as aforesaid at the time of such transfer vacation of office or inability to act, Chairman and Managing Director NTPC Limited (formerly National Thermal Power Corporation Ltd.) shall appoint another person to act as arbitrator in accordance with the terms of the Contract. It is also a term of this contract that no person other than a person appointed by CMD NTPC Ltd. as aforesaid should act as arbitrator and if for any reason that is not possible the matter is not to be referred to arbitration at all.

Subject as aforesaid the provisions of Arbitration Act 1940 or any statutory modification or re-enactment thereof and the rules made thereunder and for the time being in force shall apply to the arbitration under this Clause.”

4. By an Amendment No.1, the contract was amended as under:

“(A) the CMD NTPC stood replaced with CEO MUNPL,

(B) in the line 9, 10 and 11, it was mandated to replace "Shall be referred to ........ unable" with "Shall be referred to the Sole arbitration of the Project-in-Charge concerned of MUNPL and if the Project Incharge is unable ...... "

(C) Arbitration Act 1940 is to be read as Arbitration and Conciliation Act 1996 [necessary change may also be made in proforma contract agreement]."

5. Disputes arose during the pendency of the contract with the Petitioner claiming that it had to be paid Rs. 27,28,26,000/- as on 28th February 2013 together wi