Once the fee has been fixed with the consent of the parties, they are bound to pay the same. Issues relating to the conduct of the arbitration and/or arbitral fees are not relevant for the purpose of Section 29A.

JUDGMENT

Sachin Datta, J.

IA No. 9213/2023 (Exemption)

Allowed, subject to all just exceptions.

Application stands disposed of.

O.M.P.(MISC.)(COMM.) 147/2023

1. The present petition under Section 29A (4) and (5) of the Arbitration and Conciliation Act, 1996 [hereinafter referred as "the Act"] seeks extension of time for completion of arbitral proceedings and for making the arbitral award.

2. The arbitration proceedings commenced pursuant to the order dated 20.09.2021 passed on an application under Section 8 of the Act filed in CS (COMM) 409/2021. The said order, inter alia, states as under:

"IA No. 12200/2021 and 12230/2021

1. Issue notice.

2. Learned counsel for the plaintiff accepts notice.

3. IA No. 12200/2021 is filed by the defendant seeking an order referring the dispute between the parties to arbitration in view of Section 8 of the Arbitration and Conciliation Act, 1996 and in view of the arbitration clause in the Agreements dated 20.12.2018 and 08.01.2019. An order is also sought to vacate the interim order passed by this court on 03.09.2021. IA No. 12230/2021 also seeks somewhat similar reliefs.

4. Learned counsel for the plaintiff and learned counsel for the defendant submit that they have no objection in case this court were to refer the disputes between the parties to an arbitrator appointed by this court, preferably a retired judge of this court.

5. In view of the request of the learned counsel for the parties, Mr. Justice Manmohan Sarin (Retd.), (Mobile No. 9818000210) is appointed as an Arbitrator to adjudicate the dispute between the parties. The Ld. Arbitrator may fix his own fees.

6. The interim order passed by this court on 03.09.2021 shall continue to operate until the same is upheld/modified/vacated by the learned Arbitrator as per law......."

3. The learned arbitrator entered upon the reference on 23.09.2021. Proceedings were held before the learned arbitrator on 25.09.2021 wherein certain directions were issued to the parties to make their respective initial deposit towards fees alongwith secretarial and administrative expenses.

4. Over several dates of hearing, the learned arbitrator considered the application seeking interim measures. Although the respondent paid the initial deposit of Rs.5 lakhs as directed by the arbitrator vide order dated 25.09.2021, the respondent failed to comply with the subsequent direction of the learned sole arbitrator, made vide order dated 11.10.2021, regarding payment of an additional amount of Rs.2.5 lakhs. The said direction was reiterated by the learned arbitrator vide orders dated 27.11.2021 and 13.12.2021.

5. Subsequently, an application came to be filed by the respondent before the learned arbitrator raising a grievance with regard to the fees sought to be charged by the arbitrator which came to be dismissed on 31.01.2022. Since the controversy with regard to the fees persisted, vide order dated 16.02.2022, learned arbitrator, inter alia, directed as under:

"......

3. The Arbitrator was to fix its own fee. Ld. Counsel for the Respondent submits that the Respondent has suffered losses but would like to pursue its Counterclaims which are in the range of Rs.3.5 Crores. He prays that the Tribunal may fix the Arbitral fee as per the 4th Schedule or reasonable fee per hearing. This is a matter involving several contentious issues. Besides, it entails evidence with regard to marketing expenses, sales, Excise Duty liabilities and numerous accounting entries ancl record.-The matter has been discussed with both the Counsel, who have obtained instructions from the Respondent. Given the nature of the controversy, evidence involved as well as the financial constraints pleaded, the Arbitral fee per hearing is fixed at Rs.75,000/- each for the Claimant and the Respondent exclusive of the Administrative and Secretarial expenses for session of 2 to 2.5 hours each. The above is acceptable to the Claimant and Respondent, after seeking instructions from their respective clients have confirm the