JAYANT NATH, J.

I.A.No.7356/2017 (condonation of delay)

This application is filed under Section 5 of the Limitation Act seeking condonation of delay of 28 days in filing the accompanying petition. It is pleaded that there was delay in removing various objections in filing/re-filing and on seeking instructions/approval from the petitioners as they are under judicial custody since 12.07.2016. The application is allowed and the delay of 28 days in filing the accompanying petition is condoned.

OMP (COMM.) 254/2017 & I.A.No.7355/2017(stay)

1. This petition is filed under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as ‘the Act’) seeking to impugn the award/order dated 07.11.2016 and seeking restoration of the counter claim.

2. The petitioner does not give any details of the background facts which led to the invocation of the arbitration clause. It is stated in the petition that the respondent invoked the arbitration clause pursuant to which this court vide order dated 17.11.2011 appointed the presiding arbitrator. It is stated that on 10.03.2012, the tribunal fixed the fee of the arbitrators with regard to the claim petition as Rs.75,000/- per hearing to be paid by each of the party to each of the three arbitrators. In addition, Rs.2,500/- per hearing for secretarial assistance was fixed plus travel cost of one of the arbitrators who had to travel from Singapore for each hearing. The petitioners filed a counter claim on 27.11.2012. The same was taken on record. The arbitral tribunal on 08.04.2013 decided the fees of the counter claim as Rs.50,000/- per hearing to be paid by each of the parties to the arbitrators along with secretarial fees.

3. It is the case of the petitioners that he had been diligently making the payments of the fees of the arbitrators and has already paid Rs.61,50,000/- towards the counter claim for 41 hearings. In addition, it is stated that the petitioners have paid approximately Rs.2.50 crores towards the fees of entire arbitration for the claim/counter claim etc. On 07.11.2016 the arbitral tribunal terminated the counter claim of the petitioners in terms of the Section 38 of the Act on account of the default in payments of the fees by the petitioner.

4. I have heard the learned counsel for the parties.

5. The learned counsel for the petitioners has vehemently argued that they have paid in all a sum of Rs.2,60,02,710/- as fees for the arbitral tribunal for the claim petition and the counter claim. He submits that presently some of the directors of the petitioners are in judicial custody. On account of this hardship, the petitioners has been unable to pay the balance fees of the learned arbitral tribunal. He further submits that the matter was at the final stages as final arguments were going on when the learned arbitral tribunal has chosen to terminate the proceedings of the counter claim. He also submits that so far as the claim petition is concerned, the respondent has paid the share of the fees of the petitioners under Section 38 of the Act and now the learned arbitral tribunal has reserved its award on the claim of the respondent. He relies upon Section 38 of the Act to submit that at best in this background, the learned arbitral tribunal had the option to suspend the arbitral proceedings and ought to have exercised this option in the facts and circumstances of the case.

6. A perusal of the order dated 07.11.2016 of the Arbitral Tribunal would show that the arbitral tribunal has noted that on 05.11.2016 it has noted that the arbitration fee has not been paid in terms of the order passed by the Tribunal on 07.05.2015 and 01.08.2015. The respondents requested that the matter be adjourned for three months. Similarly, on 06.06.2016 one of the directors of the petitioners had given an undertaking to pay 50% of the share of the arrears of the arbitration fees within next 30 days. He had also undertaken to pay balance share of the 50% of the arrears of arbitration fees later