An appointment made by an ineligible person as an arbitrator is void, and waiver of objection under Section 12(5) of the A&C Act requires an express agreement in writing after the disputes have arisen.

ORDER

Vibhu Bakhru, J. (Oral). - The petitioner has filed the present petition under Sections 14 and 15 of the Arbitration and Conciliation Act, 1996 (hereafter 'the A&C Act'), inter alia, praying that the mandate of Mr Harsh Kumar, learned Sole Arbitrator, be terminated and another Arbitrator be appointed in his place.

2. The respondent company issued a Notice Inviting Tenders (NIT) dated 26.04.2018 inviting tenders for publishing and distribution of "On- Board Magazine for Indian Railways-Rail Bandhu". The petitioner submitted its bid pursuant to the said NIT along with the earnest money of Rs. 2,00,000/-. The said bid was accepted by a Letter of Award (LOA) dated 14.08.2018 and the petitioner was awarded the contract for publishing and distribution of "On- Board Magazine for Indian Railways-Rail Bandhu." (hereafter the 'Contract')

3. Certain disputes have arisen between the parties in connection with the Contract. On 12.03.2019, the respondent terminated the Contract. Thereafter, on 15.05.2019, the petitioner issued a notice under Section 21 of the A&C Act invoking the Arbitration Agreement as embodied in Clause 10 of the Terms and Conditions as applicable to the Contract.

4. The petitioner states that pursuant to the notice invoking arbitration, the Chairman-cum-Managing Director of the respondent proceeded to unilaterally appoint the learned Arbitrator by a letter dated 14.06.2019. The learned Arbitrator appointed by the respondent, is a former employee of the Railways and at the time of his superannuation, was holding the post of the Financial Advisor, Northern Railways.

5. It is stated that the petitioner did not file any application under Section 13 of the A&C Act to challenge the appointment of the learned Arbitrator. The petitioner did not object to his appointment at the material time and participated in the arbitral proceedings before the learned Arbitrator. However, the petitioner has filed the present petition in view of the decisions rendered by the Supreme Court in TRF Limited v. Energo Engineering Project Ltd.: (2017) 8 SCC 377 and Perkins Eastman Architects DPC and Anr. v. HSCC (India) Ltd.: 2019 SCC Online SC1517.

6. Mr Majithia, learned counsel appearing for the respondent, states that the Arbitrator was appointed prior to the decision of the Supreme Court in Perkins Eastman Architects DPC and Anr. v. HSCC (India) Ltd. (supra) and therefore, the said appointment cannot be challenged. He also referred to Section 4 of the A&C Act and submitted that since the petitioner had not raised any objection at the material time, it is precluded from challenging the appointment of the Arbitrator.

7. This Court is of the view that the controversy as raised is squarely covered by the decision of the Supreme Court in Bharat Broadband Network Limited v. United Telecoms Limited: (2019) 5 SCC 755. hi that case, the respondent had invoked the arbitration clause by a notice dated 03.01.2017, whereby it had called upon the Chairman cum Managing Director (CMD) of Bharat Broadband Network Limited (BBNL) to appoint an independent and impartial arbitrator. Pursuant to the aforesaid notice, the CMD of BBNL had proceeded to appoint one Mr Khan as the sole arbitrator to adjudicate the disputes between the parties. The parties had thereafter, participated in the arbitral proceedings without any reservation. However, subsequently, BBNL filed an application before the arbitral tribunal requesting the learned arbitrator to withdraw from the proceedings. BBNL contended that the learned arbitrator had become dejure unable to perform his functions as he was ineligible to do so in view of the decision of the Supreme Court in TRF Limited v. Energo Engineering Project Ltd. (supra). The said application was rejected by the learned arbitrator. Aggrieved by the same, BBNL filed a petition under Sections 14 and 15 of the A&C Act before this Court praying that the mandate of the learned arbitrator be terminated. This Court did not accept BBNL's contention.