The Delhi High Court has reiterated that on e party can't be allowed to appoint Arbitrator, unilaterally as the same would defeat the purpose of Arbitration and Conciliation Act.
The single-judge bench of Justice Suresh Kumar Kait dismissed noted that principle of unbiased adjudication of dispute between the parties enshrined in the Act can't be compromised in any sitaution.
While dismissing a unilateral arbitral clause imposed by NTPC, a Public Sector Undertaking, in its contract with the petitioner-company for a power project, the Court noted:
"no single party can be permitted to unilaterally appoint the Arbitrator, as it would defeat the purpose of unbiased adjudication of dispute between the parties."
During the course of hearing, learned counsel appearing on behalf of respondent has disputed the averments made in the present petition and submitted that as per Clause 56 and 57 of the General Conditions of Contract of the underlying contract Agreement dated 15.01.2015 postulates that "he disputes shall be referred to the sole arbitration of the General Manager of NTPC limited, and if General Manager is unable or unwilling to act, to the sole arbitration of some other person appointed by the Chairman and Managing Director, NTPC Limited, willing to act as such Arbitrator.”
He cited PERKINS EASTMAN ARCHITECTS DPC vs. HSCC (INDIA) LIMITED, 2019 Latest Caselaw 1154 SC wherein it has been categorically stated that no single party can be permitted to unilaterally appoint the Arbitrator, as it would defeat the purpose of unbiased adjudication of dispute between the parties.
Concurring with the decisions as noted above, the Court allowed the present petition and accordingly, Mr. Justice S.K. Katriar, Judge (Retd.) was appointed as sole Arbitrator to adjudicate the dispute between the parties.
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