2017 Supreme(Online)(DEL) 1720
IN THE HIGH COURT OF DELHI AT NEW DELHI % Judgment delivered on: 24.04.2017 + O.M.P. (T) (COMM.) 22/2017& IA Nos. 3579-3580/2017 HRD CORPORATION (MARCUS OIL AND CHEMICAL DIVISION) ..... Petitioner versus GAIL (INDIA) LIMITED (FORMERLY GAS AUTHORITY OF INDIA LTD.) ..... Respondent AND O.M.P. (T) (COMM.) 23/2017& IA Nos. 3581-3582/2017 HRD CORPORATION (MARCUS OIL AND CHEMICAL DIVISION) ..... Petitioner versus GAIL (INDIA) LIMITED (FORMERLY GAS AUTHORITY OF INDIA LTD.) ..... Respondent Advocates who appeared in these cases:
For the Petitioner : Mr Arvind K. Nigam, Senior Advocate with Mr Shailendra Swarup, Ms Bindu Saxena and Ms Aparajita Swarup.
For the Respondent : Mr Abhisaar Bairagi.
CORAM:
HON'BLE MR. JUSTICE VIBHU BAKHRU
JUDGMENT
VIBHU BAKHRU, J
1. HRD Corporation (Marcus Oil and Chemical Division) (hereafter „HRD‟), a Corporation organised and existing under the laws of the State of Texas, USA, has filed the present petitions under Section 14 and 15 of the Arbitration and Conciliation Act, 1996 (hereafter „the Act‟), inter alia, seeking termination of the mandate of Justice Tejinder Singh Doabia (Retired), Justice K.K. Lahoti (Retired) as arbitrators comprising of arbitral tribunal of three members. According to HRD, circumstances exist which give rise to justifiable doubts as to the independence and impartiality of the said arbitrators. It is also claimed that the arbitrators are ineligible under Section 12(5) of the Act and this would warrant termination of the mandate of the said arbitrators and appointment of two other arbitrators in their place.
2. Briefly stated, the relevant facts necessary to address the controversy are as under:-
2.1 The respondent (hereafter „GAIL‟) issued a notice inviting tender for sale and supply of Wax (a waste by-product) generated at GAIL‟s HDPE/LLDPE Plant at Petro Chemical Complex at Pata, Uttar Pradesh for a period of 20 years on an exclusive basis. HRD successfully tendered for the said contract and the parties entered into an agreement dated 01.04.1999 (hereafter „the Agreement‟). Certain disputes arose between the parties in connection with the Agreement. HRD claimed that GAIL had wrongfully withheld the supplies of Wax. Consequently, HRD invoked the arbitration clause, as included in the Agreement.
2.2 The disputes between the parties were referred to arbitration (being Arbitration Case No. 1001/2004-ICADR) (hereafter „the first arbitration‟) before the Arbitral Tribunal comprising of Justice Late A.B. Rohatgi (Retired), presiding arbitrator, Justice J.K. Mehra (Retired) and Justice N.N. Goswamy (Retired). The said tribunal made and published an award on 08.04.2006 (hereafter „the 2006 award‟) directing specific performance of the Agreement dated 01.04.1999. The 2006 award was not challenged and has become final.
2.3 After the 2006 award was rendered, certain disputes arose mainly with respect to the price to be charged for Wax for the period of 13.07.2007 to 12.07.2010. The said disputes were also referred to arbitration before an arbitral tribunal comprising of the same members as in the first arbitration: Justice N.N. Goswamy (Retired), Justice J.K. Mehra (Retired) and Justice A.B. Rohatgi (Retired) as the presiding arbitrator.
2.4 HRD claims that GAIL supplied Wax at the prices determined by the arbitral tribunal.
2.5 The disputes in relation to the period 13.07.2010 to 12.07.2013 were also referred to the same arbitral tribunal (being Arbitration Case No. 38 of 2010-ICADR). While the proceedings were pending, Justice N.N. Goswamy (Retired) expired. Thereafter, in a petition filed under Section 15 of the Act, the Supreme Court, by an order dated 23.03.2012, appointed Justice Tejinder Singh Doabia (Retired), a former Judge of the Jammu and Kashmir High Court, to fill the vacancy caused by the demise of Justice N.N. Goswamy (Retired).
2.6 Subsequent thereto, Justice A.B. Rohatgi (Retired) tendered his resignation on 17.02.2013 as the presiding arbitrator, on account of ill health. The vacancy so caused was filled on 28.02.2013 with Justice Doabia and Justice Mehra jointly nominating Justice S.S. Chadha (Retired) as the presiding arbitrator. These arbitral proceedings culminated into two separate awards dated 22.07.2015: one determining the price for Wax and the other determining the scope of supply of Wax under the Agreement.
2.7 HRD has filed a petition under Section 34 of the Act (OMP No.
525/2015) assailing the said award, which is pending before this Court.
2.8 In respect of the period commencing 13.07.2016 to 31.12.2019, GAIL claims that a price of ₹83,000/- per metric tonne of Wax was payable, on the basis as fixed in the 2006 award. This was disputed and HRD filed a petition under Section 9 of the Act,