J&K Economic Reconstruction Agency v. Rash Builders India Private Limited
2024-07-08
JAVED IQBAL WANI
body2024
DigiLaw.ai
JUDGEMENT 1. The instant petition has been filed by the petitioner herein under Section 34 of the Jammu and Kashmir Arbitration and Conciliation Act, 1997 (for short the Act of 1997) seeking setting aside of award dated 15.01.2024 passed by sole arbitrator Hon'ble Mr. Justice Amitabh Roy Judge of the Supreme Court (Rtd.). 2. Upon coming of this petition for consideration and after counsel for the petitioner in brief narrated the grounds of challenge urged in the petition against the award under challenge, the counsel for the caveator respondent raised a preliminary objection that this court lacks jurisdiction to entertain the petition as the venue/seat of the arbitration had been at New Delhi and that the arbitration proceedings were conducted at New Delhi and even award under challenge came to be passed at New Delhi. Counsel for the petitioner would, however, oppose said objection and would contend that this court is possessed of the jurisdiction to entertain and adjudicate upon the petition as the initial petition for appointment of the arbitrator in the matter came to be filed in this Court and as such all subsequent proceedings arising out thereof are maintainable before this court under Section 42 of the Act, of 1997. 3. Having regard to the aforesaid preliminary objections it is deemed appropriate to address to the same in the first instance. 4. Perusal of the record would reveal that various disputes between the petitioner and the respondent herein arose out of four contracts pertaining to four different projects namely (i) “Kralgund-Ashpora-Qaziabad Road Project ('Kralgund Project') (ii) Handwara-Zachaldara-Wadder Road Project ('Handwara Project') (iii) Hubdipora-Kadar-Qaimoh Road Project ('Hubdipora Project') (iv) Shahdara-Kamalkote Road Project ('Shahdara Project'), which disputes had to be settled through arbitration and owing to the differences between the parties qua the nomination of the arbitrator/s in the matter, the caveator respondent herein filed four separate petitions before the Hon'ble Chief Justice of this Court being AA Nos. 09/2014, 10/2014, 11/2014 and 12/2014 under Section 11 of the Act of 1997 for appointment of arbitrator/s and in terms of the common order dated 30.07.2015 passed therein the said petitions Shri Javed Ahmad Kawoosa District and Sessions Judge (Retd.) came to be appointed as a sole arbitrator, and aggrieved whereof the petitioner herein preferred civil appeal no.
09/2014, 10/2014, 11/2014 and 12/2014 under Section 11 of the Act of 1997 for appointment of arbitrator/s and in terms of the common order dated 30.07.2015 passed therein the said petitions Shri Javed Ahmad Kawoosa District and Sessions Judge (Retd.) came to be appointed as a sole arbitrator, and aggrieved whereof the petitioner herein preferred civil appeal no. 14167-14170 of 2015 before the Apex Court and in terms of order dated 07.12.2015 passed by the Apex Court with the consent of appearing counsel for the parties, Hon'ble Shri. Justice S.S. Nijjar (Retd.) Judge of the Apex Court came to be appointed as sole arbitrator considering the fact that four independent contracts are involved in the case as also in view the value of the said contracts and the Apex Court accordingly modified and set-aside the part of the aforesaid impugned order dated 30.07.2015 and the sole arbitrator so appointed by the Apex Court thereafter entered upon the reference and concluded the arbitration proceedings as well as hearing and reserved the matters for passing of award/s, however, before passing the same, the said arbitrator passed away on 26.03.2021, whereafter the respondent caveator herein filed CM No. 2676/2021 under Section 14 of the Act of 1997 before the Hon'ble Chief Justice of this Court for substitution of the arbitrator in accordance with Section 15(2) of the Act of 1997 and consequently in presence of the appearing counsel for the parties the said CM came to be disposed of on 17.09.2021 substituting Shri Justice Amitabh Roy Judge of the Supreme Court (Retd.) in place of Shri Justice S.S. Nijjar, the deceased sole arbitrator, providing further in the order that the substituted arbitrator shall enter upon the arbitration forthwith and complete the proceedings in accordance with law keeping in mind the consent of the parties, in accordance with the provisions of Section 15(3) of the Act of 1997, whereafter the said sole arbitrator continued arbitration proceedings and consequently passed the award under challenge at New Delhi on 15.01.2024. 5. Record indisputably reveals that the petitions filed by the caveator respondent under Section 11 of the Act of 1997 for appointment of arbitrator have been initially dealt with and disposed of in terms of order dated 30.07.2015 by the Designated Hon'ble Judge, not being a “court” as defined under Section 2(1)(e) of the Act of 1997.
5. Record indisputably reveals that the petitions filed by the caveator respondent under Section 11 of the Act of 1997 for appointment of arbitrator have been initially dealt with and disposed of in terms of order dated 30.07.2015 by the Designated Hon'ble Judge, not being a “court” as defined under Section 2(1)(e) of the Act of 1997. A reference in this regard to the judgment of the Apex Court passed in case titled as “State of West Bengal and Ors. Vs. Associated Contractors” reported in 2015 (1) SCC 32 wherein at para 25 it has been held as under: 25. Our conclusions therefore on Section 2(1)(e) and Section 42 of the Arbitration Act, 1996 are as follows: (a) Section 2(1)(e) contains an exhaustive definition marking out only the Principal Civil Court of Original jurisdiction in a district or a High Court having original civil jurisdiction in the State, and no other court as “court” for the purpose of Part I of the Arbitration Act, 1996. (b) ........... (c) However, Section 42 only applies to applications made under Part I if they are made to a court as defined. Since applications made under Section 8 are made to judicial authorities and since applications under Section 11 are made to the Chief Justice or his designate, the judicial authority and the Chief Justice or his designate not being court as defined, such applications would be outside Section 42. A further reference to the judgment of the High Court of Bombay passed in case titled as “Afcons Infrastructure Ltd. Vs. Konkan Railway Corporation Ltd.”, reported in 2020 SCC OnLine Bom. 681, wherein at para 19 following has been held:- 19. As indicated above, with the amendment brought about by the Amendment Act, 2015, the power is now vested in the Supreme Court or High Court or its delegate instead of the Chief Justice or his delegate. This legislative change, however, does not seem to have any bearing upon the well recognized proposition that the bar under section 42 of the Act does not apply to the authority which is vested with the power to appoint Arbitrator under section 11 of the Act, 1996.
This legislative change, however, does not seem to have any bearing upon the well recognized proposition that the bar under section 42 of the Act does not apply to the authority which is vested with the power to appoint Arbitrator under section 11 of the Act, 1996. It is plain that the Supreme Court or High Court or its delegate while exercising power under section 11 of the Act cannot be equated with the "Court" contemplated by section 42 of the Act, 1996 which has a definite and exhaustive meaning under section 2(1)(e) of the Act, 1996. 6. Further perusal of the record available on the file manifestly tends to show that the arbitral proceedings in the matter admittedly have been conducted by the arbitrator at New Delhi though online with the agreement of the parties in tune with the provisions of the Section 20 of the Act of 1997, which position also gets authenticated and corroborated upon closer examination of the record that the parties have participated in the arbitral proceedings through their respective counsels at New Delhi having filed their respective pleadings as well through their said counsels at New Delhi and the award under challenge also has been passed and signed by the arbitrator on 15.01.2024 at New Delhi. A reference to the judgement of the Apex court passed in case titled as “[1]BGS SGS SOMA JV Vs. NHPC Limited” reported in 2020 (4) SCC 234 would be advantageous hereunder wherein at para 82 following has been laid down: - 82.......further, the fact that the arbitral proceedings “shall be held” at a particular venue would also indicate that parties intended to anchor arbitral proceedings to a particular place, signifying thereby, that that place is the seat of the arbitral proceedings. This, coupled that there being no other significant contrary indicia that the “seat and venue is merely a “venue” and not the “seat” of the arbitral proceedings, would then conclusively show that such a clause designates a “seat” of the arbitral proceedings. 7.
This, coupled that there being no other significant contrary indicia that the “seat and venue is merely a “venue” and not the “seat” of the arbitral proceedings, would then conclusively show that such a clause designates a “seat” of the arbitral proceedings. 7. Having regard to the aforesaid facts and circumstances obtaining in the matter inasmuch as the position of law noticed and referred in the preceding paras the recourse taken by the petitioner herein against the arbitration award under challenge before this Court in the instant petition is not legally tenable on the ground of jurisdiction as a consequence whereof the preliminary objection raised by counsel for the respondent/caveator herein succeeds and the instant petition accordingly is ordered to be returned back to the petitioner to be presented before competent court at New Delhi. 8. Disposed of.