ORDER : Ram Mohan Reddy, J. 1. The Chief Traffic Manager of the respondent entered into an agreement dated 18th August, 2008, Annexure-A with the petitioner, an advertising agency, over advertisement rights on Suvarna buses operated to Bangalore International Airport, whereunder it was agreed that any dispute arising out of the terms and conditions of the tender or contract, the decision of the Managing Director of Bangalore Metropolitan Transport Corporation ('BMTC for short) shall be final and binding on both the parties. Certain disputes having arisen, petitioner instituted W.P. Nos. 7759 and 7760 of 2010, arraigning the respondent represented by its Managing Director, whence a learned Single Judge, by order dated 24th September, 2012, Annexure-B, directed the respondent-Corporation to issue an endorsement over what amounts petitioner is entitled to in respect of security deposit and after deducting the licence fee arrears etc., to refund the balance to the petitioner, while reserving liberty to the petitioner if aggrieved by the deductions, to approach the jurisdictional forum for redressal of grievance as per law. In that proceeding the respondent-Road Transport Corporation advanced a plea that Clause 36 of the agreement, an arbitration clause, over disputes/differences arising out of the terms and conditions of the agreement to be adjudicated by the Managing Director, BMTC as the sole Arbitrator. 2. It appears that the petitioner through learned Counsel issued notice dated 24-7-2013, Annexure-C invoking Clause 36 of the agreement dated 18-8-2008, Annexure-A and proposing to nominate Justice R. Jayasimha Babu (retired) as sole Arbitrator to arbitrate upon the disputes between the parties. That was responded to by learned Counsel for BMTC by way of a reply notice dated 22-8-2013, Annexure-D, clearly indicating that respondent-Corporation was not liable to make any payment and refuting the claim of the petitioner that the Managing Director representing BMTC whose decision would be final and binding between the parties, though arraigned as first respondent in W.P. Nos. 7759 and 7760 of 2010, is not an interested party in the transaction and therefore, declined to nominate an Arbitrator as proposed by the petitioner. In addition, it was contended that the disputes and differences do not relate to the terms and conditions of the contract. 3. 7759 and 7760 of 2010, is not an interested party in the transaction and therefore, declined to nominate an Arbitrator as proposed by the petitioner. In addition, it was contended that the disputes and differences do not relate to the terms and conditions of the contract. 3. Petitioner aggrieved by the failure on the part of the respondent to nominate an Arbitrator, has presented this petition, inter alia contending that the Managing Director of BMTC through learned Counsel responded to the legal notice dated 18-12-2009 seeking refund of Rs. 3,29,00,000/- (Rupees Three Crores Twenty-nine Lakhs only), by way of reply notice dated 25-1-2010, Annexure-E1 indicating that the denial of petitioner's claim was at the instance of the BMTC represented by its Managing Director coupled with the fact that he represented the first respondent in W.P. Nos. 7759 and 7760 of 2010 whence in the statement of objections denied petitioner's claim, has created a reasonable apprehension about the impartiality or independence of the said Managing Director, hence, seeks intervention of this Court under Section 11 of the Arbitration and Conciliation Act, 1996 not to appoint the Managing Director but a person other than the said Managing Director as an Arbitrator. 4. Petition is opposed by filing statement of objections, inter alia contending that one Syed Zameer Pasha, was the Managing Director from 16-6-2008 to 18-5-2011 while another K.R. Srinivasa from 18-5-2011 to 24-9-2012 and thereafter, presently is one Anjum Parvez and as there are no allegations of bias against the present Managing Director coupled with the fact that arbitration clause provides for appointment of Arbitrator by name, petitioner is disentitled to an appointment of any other person as Arbitrator. In addition, it is contended that the reply notice Annexure-El by itself and nothing more does not create a reasonable apprehension that the present Managing Director is not likely to act independently or impartially. 5. Sri Aditya Sondhi, learned Counsel for petitioner, reiterating the averments in the memorandum of writ petition submits that the Managing Director of BMTC having denied the claims of the petitioner in the reply by way of reply notice as well as statement of objections to W.P. Nos. 7759 and 7760 of 2010, the petitioner's apprehension about impartiality or independence of the Managing Director is reasonable. 7759 and 7760 of 2010, the petitioner's apprehension about impartiality or independence of the Managing Director is reasonable. In addition, learned Counsel submits that even if the present Managing Director is appointed as an Arbitrator, would have to over-rule, perhaps, the earlier Managing Director's rejection of petitioner's claim in the reply notice, Annexure-El, as well as statement of objections to W.P. Nos. 7759 and 7760 of 2010. Learned Counsel points to sub-section (8) of Section 11 of the Act and the observations of the Apex Court at paragraphs 14 and 15 in Indian Oil Corporation Limited and Others v. M/s. Raja Transport (Private) Limited, (2009) 8 SCC 520 : 2009 AIR SCW 7354, followed in Bipromasz Bipron Trading Sa v. Bharat Electronics Limited (BEL), (2012) 6 SCC 384 , to contend that in circumstances where there is reasonable apprehension about the impartiality or independence of the agreed or named Arbitrator, the Court need not appoint the said person as an Arbitrator, but could do so by appointing some other person. 6. Per contra, Sri R.V. Jayaprakash, learned Counsel for the respondent-BMTC reiterates the averments in the statement of objections, to submit, that in the first place, though Annexure-E1/reply notice makes reference to instructions issued by the Managing Director of BMTC, nevertheless, it was the Chief Law Officer who instructed the learned Counsel. In addition, it is submitted that the present Managing Director against whom no allegations of bias having been made, would have to be appointed as an Arbitrator in terms of the arbitration Clause 36 in the agreement whereunder both parties agreed that the decision of the Managing Director would be final and binding. 7. Having heard the learned Counsel for the parties, perused the pleadings, the question for decision making is: "Whether in the facts and circumstances, petitioner has made out a case of reasonable apprehension about the impartiality or independence of the Managing Director, the agreed Arbitrator and that the Court has the discretion not to appoint him as an Arbitrator?" 8. Regard being had to the undisputed facts that Clause 36 of the agreement, Annexure-A is an arbitration clause, whereunder the decision of the Managing Director is final and binding between the parties, in the normal course, parties would be bound by that arbitration clause and it would be the Managing Director alone who is to be appointed as an Arbitrator. Regard being had to the undisputed facts that Clause 36 of the agreement, Annexure-A is an arbitration clause, whereunder the decision of the Managing Director is final and binding between the parties, in the normal course, parties would be bound by that arbitration clause and it would be the Managing Director alone who is to be appointed as an Arbitrator. The justifiable apprehension, as contended by the petitioner, in the appointment of the Managing Director, as an Arbitrator, is buttress by the admitted fact that BMTC was represented by its Managing Director arraigned as first respondent in W.P. Nos. 7759 and 7760 of 2010 over a dispute that arose out of terms and conditions of the agreement, Annexure-A. So also, the reply notice Annexure-El, dated 25-1-2010 indicating that the said notice is issued at the instance of BMTC represented by its Managing Director, denying the petitioner's claims. A perusal of the contents of the reply notice, Annexure-El, as also contentions advanced by the Managing Director, BMTC in statement of objections to W.P. Nos. 7759 and 7760 of 2010, it cannot be said that apprehension of the petitioner over the impartiality of the Managing Director is unreasonable. Even assuming that the Managing Director who caused the reply notice during January 2010 and advanced contentions in the statement of objections to W.P. Nos. 7759 and 7760 of 2010 through legal Counsel, is no more in the services of the BMTC as Managing Director, nevertheless, the present Managing Director, it cannot be said would have an unbiased view, more so, since he would have to, perhaps, reject the reply, if the petitioner is entitled to the benefits or otherwise, which obviously, means an inherent bias that the present Managing Director too may carry and therefore, will be unable to render an unbiased award. 9. Sub-section (8) of Section 11 of the Act invests in this Court a jurisdiction that, if circumstances exist giving rise to justifiable doubts as to the independence and impartiality of the person nominated, or if other circumstances warrant appointment of an independent Arbitrator by ignoring the procedure prescribed, the Chief Justice or his designate may, for reasons to be recorded, ignore the designated Arbitrator and appoint someone else. 10. The observations of the Apex Court in Indian Oil Corporation Limited's case in the circumstances is apposite: "14. 10. The observations of the Apex Court in Indian Oil Corporation Limited's case in the circumstances is apposite: "14. There can however be a justifiable apprehension about the independence or impartiality of an employee-arbitrator, if such person was the controlling or dealing authority in regard to the subject contract or if he is a direct subordinate (as contrasted from an officer of an inferior rank in some other department) to the officer whose decision is the subject-matter of the dispute. Where however the named Arbitrator, though a Senior Officer of the Government/statutory body/Government company, had nothing to do with execution of the subject contract, there can be no justification for anyone doubting his independence or impartiality, in the absence of any specific evidence. Therefore, Senior Officer/s (usually Heads of Department or equivalent) of a Government/statutory corporation/public sector undertaking, not associated with the contract, are considered to be independent and impartial and are not barred from functioning as Arbitrators merely because their employer is a party to the contract. 15. The position may be different where the person named as the Arbitrator is an employee of a company or body or individual other than the State and its instrumentalities. For example, if the Director of a Private Company (which is a party to the arbitration agreement) is named as the Arbitrator, there may be valid and reasonable apprehension of bias in view of his position and interest, and he may be unsuitable to act as an Arbitrator in an arbitration involving his company. If any circumstance exists to create a reasonable apprehension about the impartiality or independence of the agreed or named Arbitrator, then the Court has the discretion not to appoint such a person. ........... 21. In the light of the above discussion, the scope of Section 11 of the Act containing the scheme of appointment of Arbitrators may be summarized thus: (i) to (vi) ..... (vii) If circumstances exist, giving rise to justifiable doubts as to the independence and impartiality of the person nominated, or if other circumstances warrant appointment of an independent Arbitrator by ignoring the procedure prescribed, the Chief Justice or his designate may, for reasons to be recorded ignore the designated Arbitrator and appoint someone else." 11. The aforesaid decision was followed in Bipromasz Bipron Trading Sa's case, hence unnecessary to extract the observations made therein. 12. The aforesaid decision was followed in Bipromasz Bipron Trading Sa's case, hence unnecessary to extract the observations made therein. 12. Regard being had to the facts and circumstances noticed supra, it is needless to state that petitioner's apprehension of impartiality or independence of the Managing Director is justified, well-found hence need not be appointed as an Arbitrator to arbitrate upon the disputes between the parties arising out of the agreement, Annexure-A. In the result, this petition is allowed in part. Justice V. Jagannathan, retired Judge of this Court is requested to enter upon reference and arbitrate over the disputes between the parties and conduct the arbitration proceedings at the Arbitration Centre in terms of the Arbitration Centre -- Karnataka (Domestic and International) Rules, 2012.