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IN THE HIGH COURT OF JUDICATURE AT MADRAS
N.SATHISH KUMAR
Sundaram Finance Limited – Appellant
Versus
S.M. Thangaraj – Respondent
ORDER :
1. Challenging the order of the Executing Court/II Additional Subordinate Judge, Coimbatore, dated 14.11.2024, suo motu, dismissing the Execution Petition in E.P.No.640 of 2018 in Arbitration case No. CP No.RJ/SF/302/2017, the decree holder has come up with the present revision petition.
2. The revision petitioner is the claimant and the respondents are the respondents in the arbitration case in CP No.RJ/SF/302/2017 arose out of a dispute over a loan transaction. The revision petitioner, a financial institution, referred the matter to the sole arbitrator to adjudicate the dispute that arose between the respondents and themselves. The sole arbitrator passed an award on 13.02.2018 whereby the respondents were directed to pay to the revision petitioner a sum of Rs.1,68,047.26 together with interest from 31.07.2017 till date of realization of the said amount in full and also to pay a sum of Rs.1700/- towards arbitrator's fee and a sum of Rs.800/- towards expenses incurred by the arbitrator. On the basis of the award, the revision petitioner initiated an execution proceedings to get executed the award which was taken on file by the learned II Additional Subordinate Judge, Coimbato
Executing courts cannot annul arbitral awards based on unilateral appointment of arbitrators if the parties do not challenge it; such awards remain valid until set aside as per legal procedure.
The unilateral appointment of an arbitrator does not render an arbitral award a nullity unless formally challenged; such challenges are to be made under Section 34 of the Arbitration and Conciliation....
The executing court cannot dismiss an execution petition based on unilateral appointment of an arbitrator without a challenge from a party, and an arbitral award is enforceable unless set aside under....
An arbitral award remains executable unless challenged under Section 34 of the Arbitration and Conciliation Act, 1996, even if the arbitrator was unilaterally appointed.
An arbitral award resulting from a unilaterally appointed Arbitrator is void for lack of inherent jurisdiction, allowing the executing court to refuse enforcement.
A unilateral appointment of an arbitrator by a party interested in the dispute is null and void under Section 12(5) of the Arbitration and Conciliation Act, 1996, as amended in 2015.
Unilateral appointment of a sole arbitrator violates equal treatment principles and renders the award void ab initio under the Arbitration and Conciliation Act, 1996.
An award obtained through a unilaterally appointed arbitrator lacks enforcement validity; mutual consent in appointment is essential.
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