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2017 DIGILAW 1743 (JHR)

Prem Chandra Singh v. Union of India through General Manager, South Eastern Railway, Kolkata

2017-10-06

APARESH KUMAR SINGH

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ORDER : APARESH KUMAR SINGH, J. This application has been filed under Section 11(6)(C) of the Arbitration and Conciliation Act, 1996 for appointment of an arbitrator invoking Clause 64 of the agreement dated 22nd February 2007. As a matter of fact an Arbitral Tribunal had been constituted for adjudication of the dispute between the parties in terms of the relevant arbitration clause under the agreement by the respondents-railways themselves by order dated 12th May 2011 comprising the following persons :— (1) Mr. Kanhaiya Kumar (Sr.DMM/HYB/SCR) (Ex Dy CMM/D/SER/GRC) Presiding Arbitrator (2) Mr. N.K. Das now retired (Ex Sr.DFM/ADA/SER) (3) Mr. Amit Roy working as Dy CSTE (CON)/SER/GRC (Ex Dy CSTE (Survey)/SER/GRC) Both Co-Arbitrator. 2. This arbitral panel replaced the erstwhile tribunal due to termination of their mandate. Petitioner made an application on 30th December 2016 to the General Manager, South-Eastern Railways, Garden Reach, Kolkata (Annexure-7) stating that the argument in the arbitration proceedings had concluded on 4th March 2016 and stamp paper was submitted for making and publishing the award, yet the award had not been published despite his reminder dated 28th June 2016 also. In such circumstances, the petitioner conveyed his intension to approach this Court for appointment of an arbitrator in terms of the amendment of the Arbitration Act, if the matter is not disposed of within a year. 3. The respondents appeared in the matter. By order dated 11th August 2017 the respondent railways were allowed time to file their response positively. The same has been filed after some delay on 14th September 2017. 4. Learned counsel for the respondents has adverted to the averments made therein and submitted that the arbitral panel was constituted on 12th May 2011 itself and has delivered its award on 1st August 2017 which is Annexure-A/1 to their counter affidavit. The Arbitral Tribunal had not been terminated because of the transfer or retirement of any of the members of the Arbitral Tribunal who of course are the employees of the railways. The petitioner has at no point of time alleged any lack of independence or impartiality on the part of the arbitral panel earlier. The petitioner himself admits that the hearing of the proceedings had been concluded earlier and the award was to be delivered. The petitioner has at no point of time alleged any lack of independence or impartiality on the part of the arbitral panel earlier. The petitioner himself admits that the hearing of the proceedings had been concluded earlier and the award was to be delivered. Learned counsel also points out to the minutes of the hearing held in the arbitration proceedings on 4th March 2016 (Annexure-5) wherein claimant and the respondents both have mutually agreed to extend time for making and publishing the award to which the arbitrators were also agreed. 5. In such circumstances, it is submitted that no occasion has arisen for appointment of an Arbitral Tribunal under the agreement between the parties nor the amended provisions of the Arbitration and Conciliation Act, 1996 (Amendment Act 3 of 2016) would apply to the facts of the instant case. Therefore, the application is without merit and deserves to be dismissed. 6. Petitioner on his turn has alleged delay in the conclusion of the arbitral proceedings despite the constitution of the Tribunal in May 2011 itself and the hearing concluded on 4th March 2016. Petitioner, however, has not been able to show that the arbitral panel comprising three arbitrators constituted by order dated 12th May 2011 had ever been terminated due to retirement or transfer of any of the arbitrators till date. 7. In this regard it is apposite to rely upon the judgment rendered by the Hon'ble Supreme Court in the case of Aravali Power Company Pvt. Ltd. v. Era Infra Engineering Ltd. reported in 2017 (11) Scale 265 . In the said case also the arbitrator was appointed on 19th August 2015 well before 23rd October 2015 i.e. the date on which the Amendment Act was deemed to have come into force. The Apex Court, therefore, held that the statutory provisions that would govern the present controversy were those that were in force before the Amendment Act came into effect. It was also held that the terms of agreement ought to be adhered to and/or given effect to as closely as possible. The fact that the named arbitrator happened to be an employee of one of the parties to the arbitration agreement had not by itself, before the Amendment Act came into force, rendered such appointment invalid and unenforceable. It was also held that the terms of agreement ought to be adhered to and/or given effect to as closely as possible. The fact that the named arbitrator happened to be an employee of one of the parties to the arbitration agreement had not by itself, before the Amendment Act came into force, rendered such appointment invalid and unenforceable. The Apex Court found that after the appointment of the Chief Executive Officer by the appellant as the sole arbitrator on 19th August 2015 parties appeared on 7th October 2015 and the hearing was fixed on 9th April 2016. No objection was raised by the respondent regarding continuation of the arbitration proceedings. The respondent had made a prayer seeking extension of time to file statement of claim on 4th December 2015. The Amendment Act, 2015 gazetted on 1.1.2016 was deemed to have come into force on 23rd October 2015. After rejection of the objection of the respondent by the learned arbitrator it approached the High Court for appointment of an independent arbitrator under Section 11(6) of the 1996 Act. The Delhi High Court set aside the appointment of the arbitrator and directed the appellant to suggest names of three panel arbitrators. It was also observed by the High Court that the arbitrator being Chief Executive Officer of the appellant, the apprehension entertained by the respondent was reasonable and not a vague or general objection. The Apex Court however held that there was nothing on record which could raise justifiable doubts about the independence or impartiality of the named arbitrator. The appointment of the arbitrator therefore could not be termed to be illegal or unenforceable. Consequently, the appeal was allowed. 8. The relevant factual matrix of the present case discussed herein above, also shows that the Arbitral Tribunal constituted on 12th May 2011 continued without any allegations of impartiality or lack of independence and in fact concluded its hearing in March 2016 itself. Merely because of the delay in publishing of the award the petitioner seems to have sought appointment of a fresh Arbitral Tribunal. Merely because of the delay in publishing of the award the petitioner seems to have sought appointment of a fresh Arbitral Tribunal. However, in view of the ratio rendered by the Apex Court in the case of Aravali Power Company Pvt. Ltd. (supra) the plea for appointment of a fresh Arbitral Tribunal relying upon the provisions of Section 12 of the Amendment Act 3 of 2016 as incorporated in the Act of 1996, is not tenable in law or on facts. The petitioner has, therefore, failed to make out a case for appointment of a fresh Arbitral Tribunal. The Arbitral Tribunal having rendered its award on 1st August 2017 (Annexure-A to the counter affidavit), it is up to the petitioner to assail it in an appropriate proceedings, if aggrieved there from. However, no relief can be granted in the present application which is accordingly dismissed.