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2005 DIGILAW 35 (PAT)

N. R. Construction Pvt. Ltd. v. Project Engineer

2005-01-12

R.S.GARG

body2005
Judgment 1. Heard learned counsel for the parties. 2. The applicant made an application before this Court for appointment of a substitute Arbitrator as the Arbitrator Hon ble Mr. Justice P.S. Sahay who was earlier appointed by this Court has refused to proceed further in the matter and terminated the proceedings. 3. It appears from the proceedings recorded by Hon ble Mr. Justice P.S. Sahay that the parties were nor ready and willing to pay his fees and were not co-operating with him therefore out of sheer frustration he terminated the proceedings. This Court being little sensitive to the matter in issue requested Hon ble Mr. Justice P.S.Sahay to give his mind that whether he was ready and willing to continue as the Arbitrator. Hon ble Mr. Justice Sahay has written to this Court that if a direction for re-appointment is issued then he has no objection to continue with the proceedings provided both the parties agree and they also agree to deposit the advance fee. 4. The applicant through his counsel submits that he does not agree to re-appointment of Hon ble Mr. Justice P.S. Sahay though learned counsel for the State submitted that as no misconduct has been alleged against Hon ble Mr. Justice P.S. Sahay and the reasons for termination of the arbitrai proceedings are clear he can be re-appointed. 5. Referring to Section 15(1) and 15(2) of the Arbitration and Conciliation Act, 1996 learned counsel for the petitioner submits that if the authority of the Arbitrator came to an end or where the Arbitrator withdraws from the office for any reason then the mandate of an Arbitrator shall be terminated. According to him sub-section (2) of Section 15 clearly provides that where the mandate of an Arbitrator terminates, a substitute Arbitrator shall be appointed according to the rules, that were applicable to the appointment of an Arbitrator for being replaced. He submits that if sub-section (2) does not talk of re-appointment and obliges the authority to substitute the Arbitrator then the very same person whose authority has come to an end can not be re-appointed. 6. To this learned counsel for the State submits that substitution would not only mean a change or replacement but would also mean a re-appointment also. 7. 6. To this learned counsel for the State submits that substitution would not only mean a change or replacement but would also mean a re-appointment also. 7. After hearing learned counsel for the parties, I am of the considered opinion that once the mandate of an Arbitrator, stands terminated when he withdraws from the office for any reason then a substitute Arbitrator will have to be appointed by the court under the Act and the very same Arbitrator can not be allowed to continue. 8. Taking into consideration the totality of the circumstances, I hereby appoint Hon ble Mr. Justice B.N.P. Singh, the retired Judge of this Court to act as an Arbitrator in the matter. The procedure to be followed and the fee to be charged shall be within the sole discretion of the Arbitrator. It is further made clear that if the Arbitrator requires the parties to deposit the advance fee then the parties shall be obliged to deposit the advance fee. Let a request be made to Hon ble Mr. Justice P.C. Sahay that the records held by him are required to be transmitted to Hon ble Mr. Justice B.N.P. Singh. If it is not inconvenient to him he may remit the records of his own or in the alternative he may send the complete records to us so that the records are transmitted to the newly appointed Arbitrator. A request be also made to Hon ble Mr. Justice P.S. Sahay that if the parties have made any advance deposits for future hearing then the money may be refunded to the party which was deposited as advance fee. It is further made clear that if the parties agree then the hearing previously held may be repeated at the discretion of the arbitral tribunal and if both the parties do not agree to the said procedure then the Arbitrator shall go for de novo hearing. The parties shall appear before the learned Arbitrator on 7th February, 2005. The Arbitrator shall give proper opportunity of hearing to the parties and shall make his award in accordance with law.