The court may appoint a Sole Arbitrator when a party's prolonged failure to reconstitute the Arbitral Tribunal frustrates the arbitration process.

JUDGMENT

[VIA VIDEO CONFERENCING]

Sanjeev Narula, J. (Oral):--Frustrated with never-ending arbitration proceedings, the Petitioner has filed the present petition under Section 11 (6) of the Arbitration and Conciliation Act, 1996, [hereinafter `the Act'] for the appointment of an independent Sole Arbitrator for adjudication of disputes that arose 16 years ago on account of alleged illegal termination of a contract. The facts noted hereinafter reveal a highly worrying and disappointing situation that makes a mockery of arbitration proceedings.

2. The Competent Authority of Northern Railways (being the Respondent herein) vide letter of acceptance dated 15th July, 2003 accepted the Petitioner's bid in respect of its tender for `Water supply arrangements including construction of new underground tank and its connection with existing pump house and other allied works for new washing lines at New Delhi yard (Lahori Gate area)' [hereinafter `Work']. The said contract incorporates by reference an arbitration agreement contained in Clause 64 of the General Conditions of Contract-1999 issued by Railway Board.

3. The Work was rescinded, and the contract was terminated on 3rd March, 2004. The Petitioner raised claims on the Respondent for loss and damages. On 3rd July, 2004, the Respondent also raised a counter-claim for liquidated damages. The Petitioner invoked arbitration vide letter dated 11th August, 2004 and called upon the Respondent to appoint an Arbitrator to adjudicate the disputes. This led to the eventual constitution of the first Arbitral Tribunal consisting of three members, comprising of serving officers of the Respondent (railways).

4. It turns out that the Arbitral Tribunal had to be re-constituted multiple times on account of resignation, retirement or transfer of the officers who were appointed as arbitrators. Thus, the proceedings dragged along and the sixth Arbitral Tribunal came to be constituted on 8th March, 2017. It also emerges that this Arbitral tribunal lost track of the proceedings, and as a result, the situation has reached a complete stalemate.

5. With the intent to complete the long-drawn arbitration proceedings, the Respondent vide letter dated 19th July, 2019, called upon the Petitioner to consent to switch over to the provisions of the Arbitration and Conciliation (Amendment) Act, 2015, and for the applicability of Clause 64(3)(a)(i) of GCC-2018 for nomination of a Sole Arbitrator, as the total claim value was less than Rs. 1 crore. However, the Petitioner did not agree to the amended clause and as a result the proceedings continue to standstill.

6. In its reply to the petition, the Respondent now asserts that they had been requesting the sixth Arbitral Tribunal (vide several letters dated 17th December, 2019, 10th June, 2020 and 22nd June, 2020) to expedite the arbitral hearings. Furthermore, during the proceedings held on 25th May 2021 in this petition before the court, Mr. Neeraj Shukla, Executive Engineer of the Respondent, appeared and stated before this Court that the sixth Arbitral Tribunal is still in existence. This was controverted by the Petitioner by relying upon a letter dated 24th February, 2020 issued by the Deputy Chief Manager on behalf of the General Manager, Northern Railways, which suggested that the mandate of the Arbitral Tribunal has been terminated. In this background, Respondent was directed by the Court vide order dated 27th May, 2021, to filed an affidavit confirming the factual position. The affidavit, d