VIDYAWATI CONSTRUCTION CO. v. UNION OF INDIA (UOI)
2002-03-15
SUDHIR NARAIN
body2002
DigiLaw.ai
SUDHIR NARAIN, J. ( 1 ) THE applicant has prayed that Sri P. K. Sharma, who was earlier appointed as Umpire may be treated as the Presiding Arbitrator of the Arbitral Tribunal. ( 2 ) BRIEFLY, the facts are that the applicant filed Civil Misc. (Arbitration) Application No. 36 of 1998 for appointment of arbitrators under Section 11 (4) of the Arbitration and Conciliation Act. 1996 (in short the Act ). The application was allowed by this Court on 26. 8. 1998 appointing Smt. Taneja Pandey. Deputy F. A. and C. A. O. /core/a. L. D. and Sri O. P. Narang. Deputy Chief engineer (Retired) Track Machines, Northern Railway, G-101, Prayag Kunj Apartments, 3, stratchy Road, Allahabad as arbitrators. ( 3 ) THE applicant also filed another Application No. 47 of 1998 for appointment of an Umpire. This application was disposed of on 1. 11. 1999 and Sri P. K. Sharma as agreed between the parties, was appointed as Umpire. ( 4 ) IN the present application, it has been stated that Sri P. K. Sharma be treated as Presiding arbitrator instead of as an Umpire. ( 5 ) LEARNED counsel for the applicant submitted that under Section 10 of the Act, 1996. the parties are free to determine the number of Arbitrators, provided that such number "shall not be an even number". Similarly. Section 29 of the Act provides that in arbitration proceedings with more than one arbitrator, the decision of the Tribunal shall be made by a majority of its members. A reading of both the sections clearly indicates that the Arbitral Tribunal cannot consist of an even number of arbitrators and the composition of a Tribunal contrary to these provisions could be one of the grounds for setting aside the Arbitral award as provided under Section 34 of the Act. This Court had passed an order appointing Sri P. K. Sharma as Umpire and there is no provision under 1996 act to appoint an Umpire but a Presiding Arbitrator of the Tribunal can be appointed. It is submitted that Sri P. K. Sharma be treated as Presiding Arbitrator of the Arbitral Tribunal instead of appointing him as Umpire. ( 6 ) LEARNED counsel for the respondent urged that the provisions of the Arbitration Act, 1940, would be applicable in the present proceedings as the new Act came into force on 22. 8. 1996 vide notification dated 22.
( 6 ) LEARNED counsel for the respondent urged that the provisions of the Arbitration Act, 1940, would be applicable in the present proceedings as the new Act came into force on 22. 8. 1996 vide notification dated 22. 8. 1996. The applicant is alleged to have given the notice on 18. 5. 1996 and therefore, the arbitral proceedings shall be deemed to commence on 18. 5. 1996 prior to the coming into force of the Act and therefore, the provisions of the Arbitration Act, 1940, would be applicable. The 1996 Act was preceded by three Ordinances, the first of which was promulgated on 16. 1. 1996 to be effective from 25. 1. 1996. The second Ordinance came into force on 26. 3. 1996 and it was replaced by a third Ordinance on 26. 6. 1996. All these three Ordinances were made effective from 25. 1. 1996. The first Ordinance Itself had repealed the Act of 1940. The new Act numbered as 26 of 1996 received the assent of the President on 16. 8. 1996 and was published in the Gazette on 19. 8. 1996. The notification reads as under : "in exercise of the powers conferred by Sub-section (3) of Section 1 of the Arbitration and conciliation Act, 1996 (26 of 1996) the Central Government hereby appoints the 22nd day of august, 1996, as the date on which the said Act shall come into force. " ( 7 ) AS the old Act stood repealed w. e. f. 25. 1. 1996 and the Ordinances referred to above, were effective, the arbitral proceedings shall be deemed to have been commenced under the Act of 1996 and the provisions of 1996 Act will be applicable. The controversy has now been settled by the decision of the Apex Court in Fuerst Day Lawson Ltd. v. Jindal Exports Ltd. , (2001) 6 SCC 356 , wherein the award was given on 13. 8. 1996 and, thereafter the execution proceedings were commenced. It was urged that as the award was given on 13. 8. 1996, the Act of 1940 was applicable. Their Lordships of the Supreme Court held that the Act of 1996 was a continuation of the Ordinance and deemed to have been effective from 25. 1. 1996 and the execution application under the Act of 1996 was applicable.
It was urged that as the award was given on 13. 8. 1996, the Act of 1940 was applicable. Their Lordships of the Supreme Court held that the Act of 1996 was a continuation of the Ordinance and deemed to have been effective from 25. 1. 1996 and the execution application under the Act of 1996 was applicable. ( 8 ) LEARNED counsel for the respondent has placed reliance upon the decision in Shettys construction Co. v. Konkan Railway Construction and others, 1998 (5) SCC 599 , wherein it was held that if the request is made prior to the commencement of Act of 1996, then the proceedings could be governed by the old Act. In this case, it was not shown that the proceedings were started after 25. 1. 1996. This case has no application to the facts of the present case. In the facts and circumstances of the present case, the Act of 1996 shall be applicable. ( 9 ) SRI P. K. Sharma was appointed as Umpire by this Court-There was no dispute regarding the proposal of his name. He shall now be treated as Presiding Arbitrator of the Tribunal instead of umpire. ( 10 ) THE application is accordingly, allowed and the parties shall bear their own costs.