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IN THE HIGH COURT OF ALLAHABAD
ROHIT RANJAN AGARWAL, J.
Amit Agarwal – Petitioner
Versus
Atul Gupta and Another – Respondents
Matters Under Article 227 Nos. 11263, 11273 of 2023
Decided On : 01-12-2023
| Table of Content |
|---|
| 1. background of arbitration disputes and applications under article 227. (Para 1 , 2 , 8 , 10) |
| 2. arguments regarding jurisdiction and undue delay in arbitration. (Para 12 , 16 , 18 , 26) |
| 3. court's considerations on jurisdiction and conduct of arbitrator. (Para 20 , 22 , 24 , 30) |
| 4. final conclusions on termination of arbitrator's mandate. (Para 23 , 36) |
| 5. final decision and dismissal of writ petitions. (Para 38) |
JUDGMENT :
ROHIT RANJAN AGARWAL, J.
1. These two writ petitions have been filed under Article 227 of the Constitution of India assailing the judgment and order dated 14.09.2023 passed by Commercial Court No. 1, Meerut in Arbitration Case No. 142 of 2022 (Old No. 22 of 2016) and Arbitration Case No. 143 of 2022 (Old No. 72 of 2015) (Atul Gupta vs. Amit Agrawal & Anr.) allowing the application filed by respondent No. 1 under Section 14 (2) of Arbitration & Conciliation Act, 1996 (hereinafter called as “Act of 1996”).
2. The facts in brief giving rise to the present petitions are that the petitioner Amit Agrawal entered into business of real estate in the year 1983. Respondent No. 1 joined his business and both the petitioner and respondent No. 1 carried on the business for quite a long time. In the year 2006, the dispute arose between them. The matter was referred to the sole arbitrator Pradeep Sharma on 25.01.2007.
3. An interim award was passed on 27/28.01.2007. Respondent No. 1 challenged the interim award under Section 3 4 of the Act of 1996 before the District Judge, Meerut. Vide order dated 12.07.2018 the said application under Section 3 4 of Act of 1996 being Arbitration Case No. 24 of 2007 was allowed. The petitioner filed First Appeal From Order No. 3932 of 2018 challenging the said order before this Court. Respondent No. 1 had filed Arbitration Case Nos. 55 of 2007, 56 of 2007 and 65 of 2007 (Atul Gupta vs. Amit Kumar Agarwal & Anr.) under Section 9 of the Act of 1996 before District Judge, Meerut, which was dismissed on 07.11.2007.
4. The Sole Arbitrator on 03.10.2014, as an interim measure, passed an order under Section 17 of the Act of 1996, which was received by respondent No. 1 on 08.10.2014, against which an appeal under Section 37 (2)(b) of the Act of 1996 was filed by respondent No. 1 being Appeal No. 8 of 2015.
5. Respondent No. 1 on 13.10.2014 sent a letter to respondent No. 2/the Sole Arbitrator stating therein that after making an award on 27/28.01.2007, neither he had taken any steps nor proceeded with the matter as such, in view of Section 14 (1)(a) of Act of 1996, the mandate has come to an end. It was further stated that he should withdraw from the arbitral proceedings otherwise respondent No. 1 will be compelled to move application under Section 14 (2) of the Act of 1996.
6. The Arbitrator kept the matter pending from 13.10.2014 to 13.08.2015 and on 13.08.2015, respondent No. 1 received a notice from the Sole Arbitrator wherein 30.08.2015 was fixed for final award.
7. Respondent No. 1 on 20.08.2015 filed an application under Section 14 (2) of the Act of 1996 before the District Judge, Meerut which was numbered as Arbitration Case No. 72 of 2015 (new number 143 of 2022). In the said case, respondent No. 1 on 04.09.2015 filed an application supported by an affidavit for restraining the Sole Arbitrator from proceedings further in the arbitral proceedings. The Sole Arbitrator on 24.09.2015 delivered the final award at Mumbai.
8. Respondent No. 1 filed another application under Section 14 (2) of the Act of 1996 on 31.05.2016, which was numbered as Arbitration Case No. 22 of 2016 before the District Judge, Meerut with the prayer that respondent No. 2 does not have mandate to decide application under Section 33 (4) of the Act of 1996. The said application was thereafter numbered as Arbitration Case No. 142 of 2022.
9. The sole arbitrator proceeded to pass additional award on 27.9.2016 and corrected award on 28.12.2016.
10. As both the Arbitration Case Nos.142 of 2022 and 143 of 2022 are in rega
Excessive delay by an arbitrator of over eight years justifies the termination of their mandate under Section 14(2) of the Arbitration and Conciliation Act, 1996.
The Arbitrator's prolonged inaction over eight years constituted undue delay, justifying the termination of his mandate under Section 14(2) of the Arbitration and Conciliation Act, 1996.
The main legal point established in the judgment is that the application under section 11(6) of the Act, 1996 is not maintainable when the sole Arbitrator is appointed by mutual consent and in the ab....
Point of Law : There was concurrent jurisdiction conferred on the courts ceased with subject matter in dispute and the courts where arbitration was carried out.
The jurisdictional seat of arbitration was Panchkula in Haryana, and not Delhi, as the arbitrator had fixed the jurisdictional seat under Section 20(2) of the Act before any party had moved the court....
The jurisdiction for appointing an arbitrator lies with the court where the principal agreement was executed, as per Section 11(6), despite a venue specified in an ancillary agreement.
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