O.M.P. 396/2011

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IN THE HIGH COURT OF DELHI AT NEW DELHI

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Date of Decision: 08.08.2011

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O.M.P. 396/2011 & I.A. No.8432/2011

RAJESH BATRA

..... Petitioner

Through:

Mr.

Sandeep

Sharma

and

Ms.Kanika Singh, Advocates

versus

RANBIR SINGH AHLAWAT

..... Respondent

Through:

Mr. H.S. Kohli, Advocate

Mr. Deepak Arora, Arbitrator

CORAM:

HON'BLE MR. JUSTICE VIPIN SANGHI

1.Whether the Reporters of local papers may

be allowed to see the judgment?

:

No

2.To be referred to Reporter or not?

:

Yes

3.Whether the judgment should be reported

in the Digest?

:

Yes

VIPIN SANGHI, J. (Oral)

1.

By this petition under Section 34 of the Arbitration and

Conciliation Act, the petitioner assails the award dated 12.02.2011

passed by Sh. Deepak Arora, Advocate, sole arbitrator made by him in

favour of the respondent and against the petitioner.

2011:DHC:4004

O.M.P. 396/2011

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2.

The parties entered into collaboration agreements dated

24.03.2008 and 30.03.2008. Both these agreements contain a dispute

resolution clause, which provides for arbitration by “a mutually

appointed arbitrator”. The respondent sought to invoke the arbitration

agreements and nominated Mr. Deepak Arora, Advocate as the sole

arbitrator. Pertinently, there was no mutual consent given to his

appointment as the arbitrator, at any stage, by the petitioner.

3.

The learned arbitrator assumed jurisdiction on the unilateral

nomination made by the respondent, without even bothering that

there was no consent to his appointment, given by the petitioner, and

started the proceedings by issuing notice to the parties; requiring the

respondent to file its statement of claim, and; also requiring the

petitioner to cause appearance before him.

4.

The petitioner did not put in appearance despite repeated

notices, and for the first time, put in appearance on 01.09.2010. The

proceedings recorded by the arbitrator show that the proxy counsel for

the petitioner sought time to file their reply. On 11.09.2010, the

petitioner filed the Vakalatnama and the proceedings recorded are that

the petitioner sought further time to file the reply. The petitioner’s

defence was, however, struck off by the arbitrator on the same date.

5.

On 07.10.2010, the petitioner served a notice on the arbitrator

challenging his authority to proceed in the matter, as the arbitrator

2011:DHC:4004

O.M.P. 396/2011

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had not been appointed by mutual consent. The arbitrator replied to

the said notice on 11.10.2010. In his reply, he shies away from the

petitioner’s assertion that there was no mutual agreement between

the parties to nominate him as the arbitrator. He states in his reply,

and this is so stated by him in court as well, that the respondent had

sent a legal notice dated 03.02.2010 informing the petitioner regarding

reference of disputes under the two collaboration agreements to the

arbitrator, and despite receiving the notice, the petitioner did not raise

any objection to the appointment of the arbitrator. Therefore, his stand

is that there was an implied consent given to his appointment by the

petitioner.

6.

Both the learned arbitrator as well as learned counsel for the

respondent, who has argued the matter without filing the reply despite

opportunity, have submitted that the petitioner did not object to the

respondent’s nomination of the arbitrator and, consequently, the

mutual consent is taken as impliedly granted by the petitioner, to the

appointment of the arbitrator. It is also argued that the petitioner

participated in the proceedings on 01.09.2010, 11.09.2010 and again

18.09.2010, and did not object to the appointment of the arbitrator. It

is argued by learned counsel for the respondent that the plea of the

arbitrator having no jurisdiction in the matter was raised only when his

defence was struck off by the learned arbitrator.