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2017 DIGILAW 1007 (JHR)

NIZAMIA CONSTRUCTION PRIVATE LIMITED v. JAMSHEDPUR UTILITIES & SERVICES COMPANY LIMITED

2017-06-30

APARESH KUMAR SINGH

body2017
JUDGMENT : APARESH KUMAR SINGH, J. 1. Heard learned counsel for the applicant and respondent. 2. On an application made by the present claimant/applicant himself in Arbitration Application No. 4 of 2015 with specific grounds of unnecessary delay being made in conclusion of the arbitration proceeding by erstwhile Arbitrator, after hearing the respondent, the following order was passed by learned Single Judge (Hon'ble Mr. Justice D. N. Patel) under the provisions of Arbitration and Conciliation Act, 1996. "(1) This Arbitration Application has been preferred mainly for the reason that the Arbitrator already appointed has caused too much delay in deciding the dispute between the parties. Arbitration proceedings were assigned to the Arbitrator on 24th December, 2011 as submitted by the counsel for the applicant, but, the arbitration proceedings have not been concluded by the arbitrator, who is an employee of the respondent. (2) This type of employee should be avoided to be appointed as Arbitrator, especially, looking to sub-section (5) of Section 12 to be read with 7th Schedule of the Arbitration and Conciliation Act, 1996. Therefore, a notice was also given by this applicant dated 21st January, 2015. (3) Learned counsels for both sides have agreed to appoint Mr. Gunendra Mohan Mishra, residing at 304B, Bansal Palaza, Station Road, Ranchi, who is a Practising Advocate of this Court, as an Arbitrator to resolve the disputes between the parties. (4) In view of the joint submission of the Advocates for both sides and as the applicant has no objection to the arbitrator, I hereby, appoint Sri Gunendra Mohan Mishra, Advocate, as an arbitrator to resolve the disputes between the parties. The arbitration proceedings will be continued from the stage from which it is stopped. (5) The records and proceedings of the arbitration proceedings will be handed over to the newly appointed Arbitrator by the earlier Arbitrator within a period of one week from today. This process will be completed efficiently by the respondent so that new Arbitrator can complete the arbitration proceedings as early as possible and practicable, preferably within a period of six months from the first date of hearing before him. Counsels for both sides jointly submitted that they shall cooperate the hearing and they shall not ask for any unnecessary adjournment. (6) Registrar General of this Court is hereby directed to supply copy of this arbitration application along with counter affidavit to the newly appointed Arbitrator. Counsels for both sides jointly submitted that they shall cooperate the hearing and they shall not ask for any unnecessary adjournment. (6) Registrar General of this Court is hereby directed to supply copy of this arbitration application along with counter affidavit to the newly appointed Arbitrator. (7) Arbitration Application is allowed and disposed of." 3. Thereafter, the newly appointed Arbitrator, Mr. G. M. Mishra issued notice to the claimant by order dated 9th May, 2016. The matter was taken up thereafter on 23rd May, 2016 before learned Arbitrator. The claimant had serious reservation about import of the order dated 11th March, 2016, where it was clearly observed that arbitration proceeding will be continued from the stage from which it was stopped and also in respect of proceedings of 10th and 11th hearing held on 10th January, 2015 and 31st January, 2015 respectively before erstwhile Arbitrator. These issues were raised before newly appointed Arbitrator, Mr. G.M. Mishra on 23rd May, 2016. The learned Arbitrator after taking note of the submission of counsel representing rival parties passed the following order: "1. Pursuant to the notice dated 9th of May, 2016 both the parties are present along with their representative/Advocate. On behalf of the claimants M/s Nizamiya Construction Pvt Ltd a further letter of authorization in continuation of letter dated 03.05.2016 has been filed, whereby Mr. Saibal Mitra, Advocate has also been authorized to appear and represent the claimants in the pending Arbitration proceedings aforesaid. This is taken on record. 2. Four files in sealed cover which were taken from the erstwhile Arbitrator, by the representative of Jusco as per the list sent to the Tribunal, these sealed cover were opened in presence of the parties and after both the parties verified the contents of four files as per the list submitted to the Tribunal, in token of the confirmation regarding the contents of the files representatives of both the parties put their signatures on the said list which is taken on record. 3. 3. In the notice dated 9.5.2016 from the Tribunal, referred to above it has been mentioned as follows: "On behalf of the claimants the letter dated 03.05.16 has been addressed to the undersigned inter alia mentioning therein that the cross examination of the claimants' witness is to be done." In the background of the aforesaid communication from the claimants, the claimants were directed to make available the witness concerned for cross examination' 4. However, the learned Advocate Sri Shyamal Kumar Choudhary assisted by Mr. Pallav drew the attention of the Tribunal to the minutes of the 9th, 10th and 11th hearing held on 14.06.14, 10.01.15 and 31.01.15 respectively and submitted that vide para5 of the minutes of the 11th hearing, "the witness of the claimants is hereby discharged being unable to be cross examined". Therefore, the question of further cross examination is not called for. He further pointed out that on behalf of the claimants that cross examination of the witness is to be done, as per their letter dated 3.5.2016 is not correct and accordingly further cross examination of the claimants witness is not required. 5. The learned Advocate Mr. Saibal Mitra, however pointed out that the claimants were not present in the so called 10th and 11th hearings and in fact after the 9th hearing which was held on 14.06.14 the claimants decided not to participate further before the erstwhile Arbitrator Sri B.R. Swen Sharma. As such in the absence of the notice to the claimants regarding the subsequent hearings i.e. 10th and 11th hearing the question of discharging the witness does not arise. 6. After hearing both the parties the Tribunal felt it necessary that the copies of the minutes of 10th and 11th hearing may be supplied to the claimants, which was done. The claimants are given opportunity to make their written submission with reference to the contents of the minutes for the proceeding together with their explanation with regard to the impact and effect of the direction given by the erstwhile Arbitrator vis-a-vis the direction of the Hon'ble Court dated 14.03.16 inter alia to the effect "the Arbitration proceeding will be continued from the stage from which it is stopped." 7. The parties were also heard on the point of fee of Arbitrator, which has been deferred to be decided in the next hearing. The claimants have already deposited the sum of Rs. The parties were also heard on the point of fee of Arbitrator, which has been deferred to be decided in the next hearing. The claimants have already deposited the sum of Rs. 5,000/in cash to meet the secretarial expenses. The respondents, however stated that the respondents will be depositing the amount of Rs. 5,000/- vide cheque or D.D at the earliest. 8. The travelling expenses of Rs. 3,500/- of the Arbitrator for attending the Arbitration hearing at Jamshedpur from Ranchi and back by hired Innova Car bearing No. JH05T5129 is to be equally shared by both he parties. The respondents have already paid a sum of Rs. 1,750/their share of hire charges, the claimants however failed to pay the same, which has to be remitted at the earliest. 9. The claimants are directed to submit the written submission on the points stated above with copy to the respondents within 15 days i.e. by 10th of June, 2016 and thereafter within 10 days the respondents will submit their reply if any. The aforesaid exercise is to be completed on or before 25.06.2016. With the consent of both the parties the next hearing will take place on 9th of July, 2016 at 11.30 AM at the same venue. No further notice will be given to the parties in this regard. Gunendra Mohan Misra Sole Arbitrator" 4. As it is apparent from perusal of the instant order, learned Tribunal felt it necessary that the copies of minutes of 10th and 11th hearing be supplied to the claimants, which was, in fact, done also and opportunity be given to make their written submission with reference to the contents of the minutes of the proceeding together with their explanation with regard to the impact and effect of the direction given by the erstwhile Arbitrator vis-a-vis the direction of Hon'ble Court dated 14.03.16 inter alia to the effect " the arbitration proceeding will be continued from the stage from which it is stopped." Learned Arbitrator thereafter directed the claimant to submit written submission on the points stated above with copy to the respondents and also with opportunity to the respondent to submit their reply. 5. 5. The claimant has thereafter rushed to the Court seeking termination of mandate of learned sole Arbitrator and for substitution of another Arbitrator as per provision of section 15 of the Arbitration and Conciliation Act, 1996 by directing him to start Arbitration Proceeding from the stage when lastly both the parties were present before the first sole Arbitrator. The claimant has also made an alternative prayer to interpret the order dated 11th March, 2016 passed in Arbitration Application No. 04 of 2015 " the arbitration proceedings will be continued from the stage from which it is stopped" by "the arbitration proceeding will be continued from the stage when both the parties have lastly appeared before learned sole Arbitrator." Parties are on antepodal stand on the issue of commencement of the proceedings from the stage from which it was stopped as intended by learned Single Judge in the order dated 11th March, 2016. The claimant has contended that the proceedings after 9th meeting i.e. 10th and 11th remained unattended by the claimant before the erstwhile Arbitrator, therefore, proceedings need to commence from the stage of 9th meeting onwards. 6. Learned counsel for the respondent has strongly objected to such interpretation of the direction of this Court passed in the earlier Arbitration Application No. 04 of 2015 categorically stating on the basis of enclosed Arbitration Application No. 4 of 2015 (Annexure-F) to their counter affidavit) that though the direction was passed specifically to commence the proceedings from the stage from which it has stopped in the presence of the claimants, no such issue was raised or agitated before this Court on the previous occasion by the claimant. 7. From the order at Annexure 9 quoted here in above, it is apparent that after issuance of notice at Annexure 7, the new Arbitrator, Mr. G. M. Mishra has also given opportunity to the claimant to make his written submission with reference to the contents of the minutes of the proceedings of 10th and 11th hearing as also the order dated 14th March, 2016. There is no reason to interpret the specific directions passed by this Court in the order dated 11th March, 2016 to the effect that the arbitration proceedings will be continued from the stage from which it is stopped. There is no reason to interpret the specific directions passed by this Court in the order dated 11th March, 2016 to the effect that the arbitration proceedings will be continued from the stage from which it is stopped. No occasion or justification arises for claimant to invoke the provisions of Section 15 of the Act of 1996 seeking termination of mandate of the newly appointed Arbitrator. 8. Therefore, without observing anything further on the merits of the contention of the parties lest it may prejudice the arbitration proceeding before newly appointed Arbitrator, this Court does not find any tenable grounds on facts or law to accede to the prayer made by the applicant herein. Accordingly, the instant petition is dismissed.