The unilateral appointment of an arbitrator does not invalidate the arbitration award if a valid waiver of objections is established properly in writing, affirming party autonomy.

JUDGMENT

NEENA BANSAL KRISHNA, J

1. The present Petitions under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the “Act, 1996”) have been filed by Bhadra International (India) Pvt. Ltd./Claimants (hereinafter referred to as Petitioners) and Airport Authority of India (hereinafter referred to as Respondent) to challenge the Arbitral Award dated 30.07.2018 passed by the learned Sole Arbitrator.

2. A Preliminary Objection has been taken on behalf of the Petitioner/ Claimant that since appointment of the Ld. Sole Arbitrator was made unilaterally by the Respondent/ Airport Authority of India, the Awards stand vitiated on this ground itself and further grounds need not be considered.

3. The present Order is confined to the Preliminary Objection: “whether the Awards are vitiated on the ground of unilateral Appointment of the Ld. Sole Arbitrator by the Respondent?”

4. Briefly stated, the parties entered into a License Agreement dated 29.11.2010, wherein the Respondent-Airport Authority of India (Licensee) had granted license to the Petitioners (Claimants) for Ground Handling Services on payment of royalty. Certain disputes arose inter se the parties leading to a Notice of Invocation of Arbitration dated 27.11.2015 being issued by the Petitioner requesting Respondent-Airport Authority of India to appoint the Sole Arbitrator. The Respondent consequently, in terms of the Clause 78 of the License Agreement dated 29.11.2010, appointed Mr. Justice Surinder Singh Nijjar, former Judge of Supreme Court of India as the Sole Arbitrator to adjudicate the disputes between the parties.

5. The Petitioners submitted to the jurisdiction of the Tribunal and filed their Statement of Claim on 03.05.2016 and actively participated in the arbitral proceedings. Eventually, the impugned Zero Award dated 30.07.2018, was passed by the learned Sole Arbitrator.

6. Aggrieved by the said Zero Award dated 30.07.2018, the Petitions under Section 34 of the Act, 1996 were filed, wherein the Award has been challenged on several grounds. Additionally, in the Amended Petition under Section 34 of the Act, the challenge has been made to the Award on the ground that the Sole Arbitrator was appointed unilaterally which is contrary to the settled law and the entire Award rendered is illegal and ab initio, being prohibited under Section 12(5) of the Act, 1996. Reliance is placed on Perkins Eastman Architect DPC & Anr. vs. HSCC (India) Ltd., 2019 SCC OnLine SC 1517; and Bharat Broadband Ltd. vs. United Telecoms Ltd., (2019) 5 SCC 755 .

7. It is explained that though the Objection of unilateral appointment had not been taken by the Petitioners initially in their Petition under Section 34 of the Act, 1996, but in the light of the Judgment of State of Chhattisgarh vs. Sal Udyog, 2021 SCC OnLine SC 1027, the petition was amended and an additional ground of unilateral appointment has now been taken on behalf of Petitioners. Further, the legal disqualification is a pure question of jurisdiction that goes to the root of the competence of the Arbitrator and can be raised at any stage of the proceedings, including at the stage of Section 34 of the Act, 1996.

8. It is further argued on behalf of the Petitioner that it is no longer res integra that the ineligibility of an Arbitrator can be waived only by an express Agreement in writing under Proviso to Section 12(5) of the Act, 1996 and cannot be inferred from the conduct of the parties as has also settled by the Apex Court in Govind Singh vs. Satya Group Pvt. Ltd. & Ors., (2023) 297 DLT 349. Mere participation in the arbitration proceedings would not amou