The court emphasized the necessity for impartiality in arbitration, ruling that automatic appointments of arbitrators undermined the arbitration clause, rendering the award invalid.

JUDGMENT :

JASMEET SINGH, J.

1. This is a petition under Section 34 of the Arbitration and Conciliation Act, 1996 challenging the ex-parte Award passed by the learned Sole Arbitrator on 13.12.2017 (hereinafter referred to as the „Impugned Award‟) received by the petitioner on 15.12.2017.

2. By virtue of the impugned Award, the learned Sole Arbitrator was pleased to allow and award the counter-claims filed by the respondent.

Facts

3. The brief facts encapsulating the present matter are that:-

a. The petitioner is a company incorporated under the Companies Act, 2013 engaged in execution of works contract. The respondent is a Digitally Signed joint venture of National Thermal Power Corporation and Steel Authority of India Ltd.

b. The petitioner was awarded the work of “Civil works for raising of Ash dyke (Lagoon-A from 231M to 235M for Rourkela CPP- II (2 X 60 MW)” by the Respondent vide Letter of Acceptance dated 06.12.2005. The duration for completion of the work was 12 months and the contract value was Rs. 2,59,43,975/-.

c. The petitioner submits that there was delay attributable to the respondent since amongst others delays, the work site was not handed over in time, drawings were provided late and the rate of additional quantities of work were not finalized therefore the respondent granted extension of time but recovered liquidated damages from the petitioner.

d. The respondent on 23.08.2008 terminated the contract. The petitioner being aggrieved by the termination invoked arbitration under Clause 56 of the GCC, being the Arbitration Clause.

e. As per the Arbitration Clause, the General Manager/Business Unit Head was the named Arbitrator to adjudicate the disputes between the parties. Since he was the supervising/controlling authority with regard to the contract in question, held various meetings with the petitioner reviewing the progress of the work and was the authority that took the decision to terminate the contract, the petitioner requested for appointment of an independent Arbitrator for adjudication of the disputes. However, the respondent on 20.12.2010 emphasized that in terms of clause 56 of the GCC, only the General Manager/Business Unit Head can be appointed as the Sole Arbitrator to adjudicate the disputes.

f. The petitioner vide letter dated 14.06.2011 once again requested the respondent for appointment of an independent Arbitrator for adjudication of the disputes due to the direct involvement of the named Arbitrator however Shri Debasis Sarkar, the General Manager & Business Unit Head, NSPCL (NTPC-SAIL Power Company Limited), Rourkela entered reference on 12.07.2011 while rejecting the request of the petitioner for appointment of an independent Arbitrator.

g. On 26.07.2011, the petitioner once again requested for appointment of an independent Arbitrator for adjudication of disputes, which was rejected by the Arbitrator on 26.08.2011.

h. Aggrieved by the said action, the petitioner filed an Arbitration Petition No. 59/2011 before Hon‟ble High Court of Orissa, Cuttack under Section 11 of the Arbitration & Conciliation Act, 1996 seeking appointment of an independent Arbitrator.

i. On 05.10.2012, the Hon‟ble High Court of Orissa, Cuttack kept the arbitration proceedings in abeyance, which was subsequently clarified on 10.03.2017 to state that there was no stay in the matter and the Arbitrator may proceed.

j. Post the order dated 10.03.2017, the petitioner did not file the Statement of Claim and the respondent filed the Counter-Claim on 16.08.2017.

k. On transfer of Shri