Ami Corporation v. Mitraprem Co-Operative Housing Society Limited
2024-01-03
BHARATI DANGRE
body2024
DigiLaw.ai
JUDGMENT : Bharati Dangre, J. - CARBPL/29596/23 and CARBPL/29598/23 fled under Section 29A of the Arbitration and Conciliation Act, 1996 seek extension of mandate of the sole Arbitrator and the reasons in support of such a request are comprised in the Petitions, which have set out the sequence of the proceedings before the Arbitral Tribunal. The two references were made to the Arbitrator, which arose out of the two different Agreements in form of Construction Agreement and a Lease Agreement. Under the Construction Agreement, the Petitioner/ Ami Corporation was appointed to execute work of construction and redevelopment of the Respondent/Co-Operative Housing Society situated at Village Bandra, Taluka Andheri, Mumbai Suburban District. The Construction Agreement dated 13/06/2010 was further modified by a Supplemental Agreement dated 01/06/2017. Another Agreement in form of Lease Agreement dated 13/06/2010 was executed between the Petitioner and the Respondent for lease in respect of the commercial premises in the proposed building to be constructed on the piece of land belonging to the Respondent. Certain disputes arose between the parties out of the two Agreements and as a result of which, the jurisdiction of this Court was invoked by fling the Petition under Section 9 and an Application under Section 11 of the Arbitration and Conciliation Act. By order dated, 04/09/2020, Senior Advocate of this Court was appointed as a sole Arbitrator and the first meeting was scheduled by the Arbitrator on 05/10/2020. The statement of claim came to be fled on 02/11/2020 and the statement of defence and counter claim was also fled by the Respondent on 15/03/2021. A rejoinder to the statement of defence and statement of defence to the counter claim was also fled on 31/05/2021 and as such on these dates, the pleadings in the arbitral proceedings were completed. 2. The Arbitrator issued minutes of meeting on 07/09/2021 and the various stages reached during the arbitration proceedings are set out in the Petitions and also in the affidavit-in-reply fled by the Respondent. Perusal of the said dates and events would disclose that, barring for a period of almost eight months, when the parties informed the Arbitrator that they are amidst settlement, the proceedings before the Arbitrator continued to progress. 3.
Perusal of the said dates and events would disclose that, barring for a period of almost eight months, when the parties informed the Arbitrator that they are amidst settlement, the proceedings before the Arbitrator continued to progress. 3. The Respondent in the above two Petitions has instituted CARBPL/35618/23 and CARBPL/35634/23 where it seek a relief of termination of mandate of the Arbitral Tribunal, as it also oppose the extension as prayed for in the Petitions fled by Ami Corporation. The tone and tenor of the pleadings in the Petitions fled by the Society as well as in response to the Petitions, opposing the extension of mandate of the Arbitral Tribunal is the enormous delay. Delay is attributed to the Arbitrator, by specifically pleading that whenever the Society requested the Arbitrator to fix a matter, he would first obtain the consent from the Petitioner/Contractor and the delay in the proceedings has caused great inconvenience to the members of the Respondent/Society, whose ultimate dream to have their own home in the city of Mumbai is evading them. It is specifically submitted by the learned counsel appearing for the Respondent/Society that till date no substantial progress is made in the proceedings. Not only this, in paragraph 5 of the affidavit-in-reply fled in response to the Petitions fled by Ami Corporation, a specific stand is taken that the members of the Respondent/Society have lost faith in the present Arbitrator and further have reservations about his independence and neutrality, in conduct of the arbitration proceedings and as a result of this, the society convened a special general body meeting and resolved not to accord their consent for extension of mandate of the Arbitral Tribunal. 4. When I specifically questioned the learned counsel representing the Society about the extreme stand taken in the affidavit as well as in the Petitions about loss of faith in the Arbitrator and expressing doubt over the independence and neutrality of the Arbitrator and about the material in support of such allegation, my attentions is drawn to the tabular form, in the affidavit-in-reply fled by the Respondent. What is attempted to demonstrate before me is, the approach of the Arbitrator in fixing the long dates and not effectively proceeding with the arbitration proceedings. 5.
What is attempted to demonstrate before me is, the approach of the Arbitrator in fixing the long dates and not effectively proceeding with the arbitration proceedings. 5. On perusal of the same, in my considered opinion, merely because the dates are not fixed at the convenience of one of the parties, it cannot cry hoarse and allege that the Arbitrator is biased or not impartial. It is too serious allegation to be levelled against an Arbitrator, who is appointed by the Court and worth it to note that in the present case, by consent of the parties. Merely because the proceedings could not proceed at the pace expected by the Society and, since they are awaiting the fruits of the Agreement entered with Ami Corporation, the blame cannot be put upon the Arbitrator and the conduct of the Respondent in attributing partiality and a biased approach, without any specific proof or malafdes being pointed out, either in the Petitions or the affidavit-in-reply, in my considered opinion, is a serious conduct which must be deprecated. 6. Turning to the sequence of events, it is evident that the pleadings before the Arbitrator were concluded on 31/05/2021 and on 02/09/2021, draft issues were finalised in respect of the first reference and as far as the second reference is concerned, draft issues were finalised on 07/09/2021. On 07/09/2021, the minutes of the arbitral meeting in the references, fixed the schedule for the examination of the witness in the first reference, with a clear understanding that the evidence in the second reference shall be recorded after the evidence in the first reference is over and it is also indicated to the parties that the arguments would be heard in both the references separately, after the evidence in both the references is recorded. There is no objection raised by the Respondent/Society to this minutes of the arbitral meeting and rather it is by consensus that the schedule in both the references was set out by the Arbitrator. Accordingly on 10/10/2021, affidavit of evidence in lieu of examination-in-chief and compilation of documents is fled by Ami Corporation. Apart from this, an additional affidavit of evidence is fled by the Petitioner/Contractor to the first reference on 04/02/2022. The affidavit of evidence in lieu of examination-in-chief of the defence witness of the Society was fled on 04/12/2021 and on 03/03/2022 for the second witness in the first reference.
Apart from this, an additional affidavit of evidence is fled by the Petitioner/Contractor to the first reference on 04/02/2022. The affidavit of evidence in lieu of examination-in-chief of the defence witness of the Society was fled on 04/12/2021 and on 03/03/2022 for the second witness in the first reference. The affidavit of evidence, however, is not fled in the second reference. From the chart, which is included in the affidavit-in-reply, it can be seen that at one point of time, the request was made to the Arbitrator to fix the date for cross-examination of the Petitioner/Contractor's witness and on 04/04/2022, the cross-examination commenced, however, it was not concluded and the next date allotted was 25/04/2022, when the cross-examination again continued, but thereafter, it is the allegation that no date was fixed and though the e-mail communications were addressed to the Arbitrator, no orders were passed. The e-mail communications are annexed to the Petitions. It is the specific allegation that on two occasions, the cross-examination could not proceed on the ground of illness of the Petitioner/Contractor's witness and the proceedings were adjourned. What is attempted to be canvassed in the pleadings as well as in the oral submissions by the learned counsel representing the Society is, the Arbitrator before granting the dates, consulted the Petitioner/Contractor and this is how bias is perceived. Ultimately, the Arbitrator is in control of the proceedings and before fixing up a date, he is expected to seek convenience of both the parties and I see no reason, why it shall be presumed that the Arbitrator has committed some illegality in consulting the other side, before fixing the date. The arbitral proceedings are now at the stage of cross-examination of the Claimant's witness in the first reference and since it is made clear to the parties that the evidence in the second reference shall be recorded only after the evidence in the first reference is over, the learned Arbitrator is proceeding in a right direction, as per the minutes of the meeting and as decided by the consent of the parties. Therefore, the accusation that he is not acting in a fair manner and attributing partiality to him, in my considered opinion, is an attempt to wriggle out the proceedings before the Arbitrator, who was appointed by the consent of the parties.
Therefore, the accusation that he is not acting in a fair manner and attributing partiality to him, in my considered opinion, is an attempt to wriggle out the proceedings before the Arbitrator, who was appointed by the consent of the parties. In absence of specific material attributing biased approach to the Arbitrator and for loss of faith in him, I am not inclined to entertain the objection on behalf of the Respondent/Society that the Arbitrator shall be substituted. The aforesaid stand does not deserve any consideration and, therefore, the same is rejected, including the Petitions fled by the Respondent/Society. 7. As far as the two Petitions, which seek extension of the Arbitral Tribunal are concerned, since the proceedings are on-going, I deem it appropriate to grant the extension as prayed for. Necessarily, the mandate of the Arbitral Tribunal is extended by a period of one year from today. It is expected that the Arbitrator shall conclude both the references within the said period and the parties are expected to render all co-operation to the learned Arbitrator. With the aforesaid direction, CARBPL/29596/23 and CARBPL/29598/23 fled by Ami Corporation stand allowed and CARBPL/35618/23 and CARBPL/35634/23, fled by the Respondent/Society stand dismissed. 8. At this stage, the learned counsel appearing for the Respondent/Society has instructions to seek stay of the order. In fact, making such request, itself reflect that the members of the Respondent/Society have developed grudge against the Arbitrator and without any justification being offered in support of such statement made in paragraph 5 of the affidavit-in-reply, which I have already rejected, the request for stay must also meet same fate and it is accordingly rejected.