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IN THE HIGH COURT OF DELHI
C. Hari Shankar, J.
H.S. Oberoi Buildtech Pvt. Ltd. - Appellant
Versus
Mahamaya Infrastructure Pvt. Ltd. - Respondent
Arb.P. 543 of 2021, I.A. 6866 of 2021
Decided On : 13-09-2021
| Table of Content |
|---|
| 1. petition for arbitration under section 11. (Para 1) |
| 2. objection regarding appointment of arbitrator. (Para 2 , 3) |
| 3. court's independence in arbitrator appointment. (Para 4 , 5 , 6) |
| 4. appointment of mr. gautam narayan as arbitrator. (Para 7 , 8 , 9) |
(Video-Conferencing)
1. This is a petition under Section 11 of the Arbitration and Conciliation Act, 1996 ("the 1996 Act") for reference of the disputes between the parties to arbitration.
2. The only objection, raised by Mr. Kapoor, learned Counsel for the respondent, is tethered on Clause 52.2.2 of the General and Special Conditions of Contract ("GSCC", in short). Clauses 52.2.1 and 52.2.2 of the GSCC may, for this purpose, be reproduced thus;
"52.2 Arbitration
52.2.1 Any dispute arising out of a Notified Claim of the Contractor include[sic] in the Final Bill of the Contractor in accordance with the provisions of Clause 52.1.2 hereof, and any dispute arising out of any Claim(s) of the Owner against the Contractor shall be referred to the arbitration of a Sole Arbitrator selected in accordance with the provisions of Clause 52.2.2 hereof. It is specifically agreed that the Owner may prefer its Claim(s) against the Contractor as counter-claim(s) if a Notified Claim of the Contractor has been referred to arbitration. The Contractor shall not, however, be entitled to raise as a set-off defense or counter-claim any claim which is not a Notified Claim included in the Contractor's Final Bill in accordance with the provisions of Clause 52.1.1 hereof.
52.2.2 The Sole Arbitrator referred to in Clause 52.2.1 hereof shall be selected by the Contractor out of a panel of 3 (three) persons nominated by the Owner for the purpose of such selection, and should the Contractor fail to select an arbitrator within 30 (thirty) days of the panel of names of such nominees being furnished by the Owner for the purpose, the Sole Arbitrator shall be selected by the Owner out of the said panel."
Admittedly, there was a default, on the part of the petitioner, in selecting a contractor out of the panel of three persons nominated by the respondent. This would bring into operation the second part of Clause 52.2.2 which envisages selection of the arbitrator by the Owner. This part of the Clause is, however, inoperable in view of the law laid down by the Supreme Court in Bharat Broadband Network Ltd. vs. United Telecoms Ltd., (2019) 5 SCC 755 and Perkins Eastman Architects DPC & Anr. vs. HSCC (India) Limited, (2020) 20 SCC 760 as well as of this Court in Proddatur Cable TV Digi Services vs. SITI Cable Network Limited, (2020) 267 DLT 51.
3. Mr. Kapoor's submission is that, though he has no objection to an arbitrator being appointed by this Court, in view of the default on the part of the petitioner in selecting an arbitrator out of the panel of three arbitrators provided by the respondent, compliance with the protocol contemplated by Clause 52.2.2 would require this court to appoint an Arbitrator from the said panel.
4. The submission is merely required to be stated to be rejected. The power of this Court to appoint an arbitrator, under Section 11 (6), cannot be hedged in by any panel of arbitrators suggested by one party or the other. Once Section 11 (6) of the Arbitration Act applies, it is for the Court to appoint an Arbitrator, as per its best judgment. There is no question of requiring this Court to appoint the Arbitrator out of the panel of arbitrators suggested by the respondent.
5. The opening part of Clause 52.2.2 applies only to provide a choice of arbitrators to the petitioner. It does not provide a choice of arbitrators to the Court. Once the petitioner has not chosen an arbitrator out of the said panel, and the second part of Clause 52.2.2 cannot be worked on account of the law laid down in the aforesaid decisions, this Court has to appoint the arbitrator independently of Clause 52.2.2.
6. The submission of Mr. Kapoor, learned Counsel, that the Court should a
The Court has the independent authority to appoint an arbitrator under Section 11 of the Arbitration Act regardless of the parties' proposed panel of arbitrators.
The power of the court to appoint an arbitrator under Section 11(6) of the Arbitration Act cannot be restricted by any panel of arbitrators suggested by one party or the other.
A sole arbitrator can be appointed by a party if the opposing party defaults on arbitrator appointment, per arbitration clause and judicial precedent.
The appointment of the arbitrator must be in accordance with the arbitration agreement and must satisfy the provisions of the arbitration act.
The court's authority to appoint an arbitrator in cases where the parties are unable to agree, in accordance with the law laid down by the Supreme Court and the provisions of the Arbitration & Concil....
The court has jurisdiction to appoint an arbitrator when parties cannot agree, reaffirming the necessity to comply with provisions of the Arbitration and Conciliation Act, 1996.
Failure to give notice invoking the arbitration Clause renders the application under Section 11 premature.
The main legal point established in the judgment is the ineligibility of the appointed arbitrator under Section 12(5) read with Schedule VII of the Arbitration Act and the requirement for a panel of ....
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