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IN THE HIGH COURT OF DELHI
C. Hari Shankar, J.
JMC Projects (India) Ltd. - Appellant
Versus
Indure Private Limited - Respondent
O.M.P. (T) (COMM.) 33 of 2020 & I.As. 6023-25 of 2020
Decided On : 20-08-2020
| Table of Content |
|---|
| 1. petition under arbitration act. (Para 1) |
| 2. dispute from work order and arbitration clause. (Para 3 , 4 , 5) |
| 3. judicial decisions regarding arbitrator's ineligibility. (Para 8 , 10) |
| 4. grounds for challenge of arbitrator. (Para 9) |
| 5. ineligibility of arbitrator due to relationships. (Para 11 , 12 , 14) |
| 6. invocation of arbitration clause and arbitration notices. (Para 16 , 17) |
| 7. challenges to appointed arbitrators. (Para 18 , 19) |
| 8. limits on arbitrator's appointment powers. (Para 28 , 29) |
| 9. statutory incapacity of arbitrator and termination of mandate. (Para 38 , 39 , 41) |
| 10. conclusion on appointment and continuation of arbitration. (Para 42 , 44 , 46 , 47) |
(Video-conferencing)
1. This petition has been preferred under Section 14 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as "the 1996 Act"), seeking a declaration that the mandate of the learned Arbitrator, presently arbitrating on the dispute between the petitioner and the respondent, stands terminated under Section 14 (1) (a) of the 1996 Act, and to appoint a substitute arbitrator, in his place, to continue with the said arbitral proceedings and render award therein.
2. Given the nature of the controversy, any detailed reference to the dispute between the parties would be unnecessary, and a brief allusion would suffice.
3. The disputes between the parties emanate from a work order, dated 6th September, 2011, awarded by the respondent to the petitioner. The work order contained General Conditions of Contract (hereinafter referred to as "GCC"), Clause 14 of which contemplated resolution of disputes, relating to the contract, by arbitration, and read thus:
"14. Arbitration
Where any dispute is not resolved as provided for in the clause 13.5 then the following provisions shall apply:
a) The dispute shall be referred to arbitration at the request of either party upon written notice to that effect to the other party (a "Notice of Reference") in accordance with the Arbitration Rules of Indian Arbitration and Conciliation Act, 1996 in force at the date of the agreement. Where the rules do not deal with any issue arising in connection with the conduct and/or procedure of the arbitration such issue shall be resolved in accordance with the law of the place in which the arbitration is held and GCC clause 14 shall be construed accordingly.
b) Performance of the contract shall continue during any arbitration proceeding pursuant to the above clause unless the employer shall order the suspension thereof pursuant to GCC Clause 13.
c) Upon every or any such reference, the cost of and incidental to the reference and award respectively shall be on the direction of the Sole Arbitrator so appointed who may determine the amount thereof or direct the same as between party & parties by whom and in what manner the same is to be borne and paid.
d) The place of arbitration shall be Delhi and the language of the arbitration shall be English.
e) The parties agree that any arbitration award shall be final and binding upon the parties (to the fullest extent permitted by applicable law) and the parties waive their right to any form of appeal or other similar recourse to a court of law.
f) The arbitration will take place before a Sole Arbitrator who shall be nominated by Mr. N. P. Gupta, Chairman of Desein Private Limited, Desein House, Greater Kailash-II, New Delhi-110048."
4. Disputes arose between the petitioner and the respondent, resulting in the petitioner invoking the afore-extracted arbitration clause, vide paras EE and FF of communication dated 1st July, 2016, which read thus:
"EE. In these circumstances explained above and by way of the present notice and as per Clause 14 (f) of the General Condition of Contract for Civil Works provided in the Work Order dated 06.09.2011, entered into between the parties, JMC hereby invokes the Arbitration clause of the aforesaid Work Order. In view of this, please consider this as a `Notice of Referen
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