Mmtc Limited vs International Commodities ...
2003 Latest Caselaw 1321 Del

JUDGMENT

Mahmood Ali Khan, J.

1. This order will dispose of an application filed by the petitioner under Section 5 and 11 of the Arbitration Act, 1940.

2. The facts leading to this application as disclosed in the petition are that under an agreement dated 23.6.1992 the petitioner purchased 80,000 MTs of S.Bright Yellow Sulphur Crude and Soluble of Saudi Arabian origin. Dispute and differences arose between the parties in respect of this supply and to resolve it the respondent no. 1 invoked arbitration clause 16 of the agreement and appointed Mr. A.K. Khandwala as their arbitrator and further called upon the petitioner to appoint its arbitrator. The petitioner appointed Mr.T.V. Shanbagh as its arbitrator. Respondent no.1 raised certain objections to this appointment so Mr.Shanbagh resigned and the petitioner appointed Mr. Justice (Retd.) B.J. Dewan as arbitrator in accordance with the terms of the arbitration clause. The arbitration proceedings were to be held in Delhi. After the appointment of the above named arbitrators the parties by a fax message dated 8.12.1995 were informed that the preliminary hearing in the arbitration proceedings would be held in New Delhi in January, 1996. In the meantime the pleadings in the proceedings were completed and the arbitrator requested the parties to intimate whether they propose to lead oral evidence or would rely only on documentary evidence. According to the petitioner this order was passed after the arbitrators had entered upon the reference by applying their minds. On the request of the respondent no.1 the arbitrators adjourned the hearing for six months and intimated the parties about it by letter dated 8.3.1996. According to the allegations of the petitioner some dispute and difference arose between the respondent no.1 and the arbitrator Mr. A.K. Khandwala as a result Mr. Khandwala resigned from his office as arbitrator by letter dated 30.7.1997. But before that the respondent no.1 appointed Mr.Tapas Icot, who is respondent no.3 in the proceedings, as their arbitrator. The arbitration proceedings were thereafter held on 25.4.1997. Mr. A.K. Khandwala who was appointed by the respondent no.1 as arbitrator had still not resigned nor was he removed as arbitrator in accordance with law. The appointment of Mr. Tapas Icot as arbitrator before the removal or resignation of Mr. A.K. Khandwala is contrary to the provisions of the Arbitration Act, therefore, proceedings conducted by the arbitrator on 25.4.1997 and 29.6.1999 are vitiated. The petitioner on 19.7.1999 sent a letter to the arbitrator informing them that it had no knowledge of the appointment of Mr.Tapas Icot as an arbitrator by the respondent no. 1 and further that Mr. A.K. Khandwala continued as arbitrator till 30.7.1997, therefore, the appointment of the former was improper and that the arbitration proceedings held by Mr. Icot as arbitrator on 23.7.1999 was bad in law. The petitioner also contended in the said communication that under the arbitration agreement the venue of the arbitral proceedings was Delhi and that the proceedings could not be held in Mumbai. Besides it was also stated therein that the time for making and publishing the award had already expired, therefore, the arbitrators had become functus officio and were not competent to hold the proceedings. But the arbitrators continued the arbitral proceedings and conducted hearing on 23.7.1999. They dealt with some contentions of the petitioner raised in the letter dated 19.7.1999 but no finding about the legality or otherwise of the appointment of Mr. Tapas Icot, respondent no.3 was given. From the perusal of the proceedings dated 23.7.1999 it was evident that the respondents no.2 & 3 i.e the arbitrators had not entered upon the reference till 29.6.1999 which indicates that the arbitrators had failed to enter upon the reference and they did not proceed with the reference nearly for a period of three and a half years which is an inordinate delay and constituted a ground for their removal under Section 11 of the Arbitration Act, 1940. It was prayed that the authority of the respondent no. 3 Mr. Tapas Icot as an arbitrator in the arbitration proceedings between the petitioner and the respondent no.1 may be revoked and it be declared that the arbitration proceedings held on 25.4.1997, 29.6.1999 and 23.7.1999 are null and void.

3. This petition is opposed by the respondent no. 1. It was contended that the appointment of Mr. Tapas Icot, respondent no. 3 as arbitrator was made by the respondent no. 1 on 20.3.1997 in place of the previous arbitrator Mr. A.K. Khandwala who had neglected to act and/or was incapable of acting in the manner in view of his illness and heart surgery. The respondent no. 1 has intimated about its intention to replace Mr. Khandwala arbitrator by telefax dated 18.3.1997 to Mr. Khandwala as well as to the advocates of the petitioner. The appointment of Mr. Icot as arbitrator in place of Mr. Khandwala was also communicated to the petitioner's advocate by letter dated 20.3.1997. No objections to the appointment of Mr. Icot was taken by the petitioner. Mr. Khandwala consequently had also tendered his resignation on 30.7.1999 after an acrimonious exchange of correspondence regarding the exorbitant fees and expenses of about Rs. 1,36,500/- demanded by him without a single hearing having been held. The advocate of respondent no.1 had forwarded a complete set of pleadings and documents to Mr. Icot by letter dated 10.4.1997 and requested for an early hearing. Copy thereof was sent to the advocate of the petitioner. Thereafter, respondents no.2 & 3 arbitrators appointed Mr. Justice (Retd) D.M. Rege of Bombay High Court as umpire and issued preliminary directions on 25.4.1997 in respect of the venue and their fees. The arbitrator also asked the parties to indicate whether they consented to have Mumbai as venue of the proceedings. The advocate of the petitioner by letter dated 17.5.1997 confirmed to the respondents that the petitioner wished to have Bombay as the venue of the proceedings. No objection to the appointment of Mr. Icot as arbitrator was raised even at that stage. The arbitrators fixed the hearing of the arbitral tribunal at Mumbai on 28.2.1998. It was communicated to the advocates of the parties. By another letter dated 24.2.1998 the venue of the arbitral proceedings was fixed in the conference room of Great Eastern Shipping Co. Ltd in Mumbai. The advocate of the petitioner further by a telefax dated 24.2.1998 requested that the hearing be adjourned to some other date in view of the announcement of the elections and the petitioner's officer would find it extremely difficult to attend the proceedings. Still no objection was taken to the appointment of Mr. Icot as arbitrator. Inference is that the petitioner had acquiesced in the appointment of Mr. Icot in place of Mr. Khandwala and waived the objections. The petitioner had requested that the hearing be fixed after 16.3.1998. The date of hearing was not fixed so the respondent no. 1 by letter dated 9.4.1999 and 26.4.1999 requested the arbitrators for fixing an early date. The petitioner did not raise any objections to the various requests made by the respondent no. 1 to the arbitrators for expeditious hearing in the arbitration proceedings. Ultimately the arbitrators fixed the hearing on 29.6.1999 and intimated the parties. The petitioner as well as its counsel at Mumbai were given notice thereof by the arbitrators vide telefax dated 17.6.1999. On 29.6.1999 neither the petitioner nor its advocate were present at the hearing. On being contacted on telephone the advocates of the petitioner informed that they had no instructions to appear at the hearing. The arbitrators did not proceed against the petitioner exparte and refixed the hearing on 23.7.1999. Notice dated 2.7.1999 was sent to the petitioner and their advocates. The petitioners advocate addressed letter dated 19.7.1999 to the respondent no.2 stating their objections to the hearing. In the said letter they objected to the appointment of Mr. Icot, respondent no. 3 as arbitrator by respondent no.1 in place of Mr. Khandwala on the ground that Mr. Khandwala had resigned only on 30.7.1997. They also took objections to the venue of the proceedings being at Mumbai. They also alleged that the hearing had been fixed by one of the arbitrators alone and the notice were issued to the parties on behalf of both the arbitrators. The letter dated 19.7.1999 was not sent to respondent no. 1 or to respondent no. 3 arbitrator. The petitioners' advocate by a separate telefax dated 20.7.1999 also objected to the hearing on the ground that the arbitration proceedings had abated since according to them time had not been extended. They further took no objection to the appointment of the respondent no.3 as an arbitrator in the said letter. The arbitrators had considered the objections raised on behalf of the petitioner on 23.7.1999 and rejected them by an order of the same date. They also framed issues and adjourned the hearing to give an opportunity to the petitioner to appear on 7.8.1999. It was adjourned on the request of the advocate of the respondent no. 1 who was indisposed but before the date could be fixed the arbitrators were restrained from proceeding by an order of this court dated 10.8.1999. It was, therefore, submitted that the application has no merit and deserves to be dismissed.

4. Both the parties had submitted copies of the documents, genuineness and correctness of which was not disputed and on their request the matter was listed for final disposal in the category of short cause. I have heard learned counsel for the parties and I have perused the record. The questions that arise for determination in the case are :- (1) whether the appointment of Mr. Tapas Icot, respondent no.3 as an arbitrator by the respondent no. 1 in place of Mr. A.K. Khandwala by letter dated 20.3.1997 is in accordance with law (2) whether and the proceedings conducted on 25.4.1997, 29.6.1999 and 23.7.1999 by Mr.Icot conjointly with the respondent no.2, the arbitrator appointed by the petitioner are null and void; (3) whether the time for making and publishing the award had expired and the arbitrators have become functus officio and were not competent to continue the arbitration proceedings.

5. As regards the first question a few facts about which there is no dispute between the parties and which are also borne out from the record have to be noticed. Mr. A.K. Khandwala was appointed as an arbitrator by the respondent no. 1 by letter dated 26.7.1993. The petitioner also appointed Mr. T.V. Shanbagh as its own arbitrator on 18.8.1993. Objections were not raised against his appointment. Thereafter, the respondent no. 1 filed statement of claim on 22.3.1994. The petitioner filed its reply on 31.5.1994.. Its rejoinder was submitted by the respondent no. 1 on 29.9.1994. Thereafter, written submissions were filed by the respondent no.1 before the arbitrator on 29.3.1995. Mr. T.V. Shanbagh arbitrator nominated by the petitioner resigned on 20.10.1995. The petitioner appointed Mr. Justice (Retd.) B.J.Diwan as arbitrator on 14.11.1995. On 8.12.1995 the two arbitrators informed the parties that preliminary hearing in the arbitration proceedings would be held in New Delhi in January, 1996. The preliminary hearing however did not take place and at the request of the respondent no.1 the hearing was adjourned for six months. It is alleged that the hearing was adjourned to enable the parties to settle the dispute which fact has not been controverter at the time of hearing. Some differences arose between the respondent no.1 and Mr. A.K. Khandwala who had since shifted to U.K. It is stated on behalf of the respondent no. 1 that the dispute was about the demand of an unreasonable amount as fees and his inability to travel on account of his being indisposed. Anyhow the respondent no.1 appointed Mr. Tapas Icot, respondent no.3 herein as its arbitrator in place of Mr. Khandwala on 20.3.1996. On 25.4.1997 the petitioner's, arbitrator respondent no.2 and Mr. Tapas Icot, respondent no. 3 appointed Mr. Justice (Retd) D.M. Rege as umpire and called upon the parties to agree to the venue of the arbitration proceedings being at Mumbai by communication dated 25.4.1997. Mr. Khandwala, resigned from the office of the arbitrator on 30.7.1997. On the request of the respondent no.1 respondents no. 2 & 3 arbitrators fixed the hearing in the arbitral proceedings on 29.6.1999 and notified it to the parties on 17.6.1999. The petitioner then raised objections on 20.7.1999 that the appointment of Mr.Tapas Icot, respondent no. 3 as arbitrator is illegal and is in contravention of the Act and the arbitration proceedings have also abated. The two arbitrators on 23.7.1999 considered the objections raised on behalf of the petitioner and rejected them. Thereafter, fresh dates of hearing were fixed at Mumbai in which the petitioner did not participate. In the meantime the petitioner filed the instant petition and obtained an exparte order for stay of the arbitration proceedings on 10.8.1999.

6. Counsel for the petitioner has argued that the authority of an arbitrator appointed by a party cannot be revoked without the leave of the court in view of Section 5 of the Act. Therefore, the appointment of Mr. Icot, respondent no. 3 as arbitrator while Mr. Khandwala was in office is in flagrant violation of the provision of Section 5 of the Act. His appointment is illegal and the arbitration proceedings conducted by the arbitral tribunal joining Mr.Icot as an arbitrator after 20.3.1997 are null and void.

7. Conversely it is argued on behalf of respondent no.1 that Mr. Khandwala was unwilling to continue as arbitrator since he was suffering from heart disease and was unable to travel from London where he was living and he had also expressed his intention to resign. For these reasons the respondent no. 1 appointed Mr. Icot, respondent no. 3 as arbitrator in his place and intimated the petitioner and Mr.Khandwala by letter dated 20.3.1997. There were differences on the payment of the fee claimed by Mr. Khandwala, Mr. Khandwala also ultimately resigned on 30.7.1997. It is submitted that the appointment of Mr. Icot in place of Mr. Khandwala before the letter's resignation from the office of the arbitrator may be a mere irregularity which stood regularised after the formal resignation of Mr. Khandwala on 30.7.1997. Counsel for the respondent no.1 has further argued that the petitioner by his conduct had also acquiesced to the appointment of Mr.Icot respondent no. 3 as arbitrator by the respondent no. 1. It is pointed out that Mr. Icot was appointed on 20.3.1997 and intimation thereof was sent to the petitioner. The petitioner did not raise any objection to the said appointment. It is submitted that the complete set of pleadings was forwarded by the respondent no. 1 to Mr. Tapas Icot on 10.4.1997 with a notice to the petitioner. Still there was no objection to the appointment of Mr. Icot. Thereafter, respondent no. 2 and Mr. Tapas Icot, respondent no. 3 on 25.4.1997 appointed Mr. Justice (Retd) D.M. Rege as umpire fixed their fee and also called upon the parties to agree to the venue of the proceedings at Mumbai. The advocates representing the petitioner agreed to the venue of the proceedings being at Mumbai by letter dated 17.5.1997. Respondents no. 2 & 3 fixed the hearing of the arbitration proceedings at Mumbai on 28.2.1998 by letter dated 3.2.1998. Yet no objection was raised by the petitioner to the appointment of Mr.Icot. The petitioner requested for adjournment of the hearing and the advocates of the petitioner requested for fixing the hearing of the arbitration proceedings after 16.3.1998 vide letter dated 24.2.1998. Their request was acceded to. There was no objection even then to the appointment of Mr. Icot. Respondent no.1 by letters dated 9.4.1999 and 26.4.1999 requested the arbitrators for hearing the matter at an early date. Intimation was given to the petitioner. There was no objection to the appointment of Mr.Icot. The petitioner and their advocate did not attend the hearing on 29.2.1999. They did not inform the arbitrator or the respondent no. 1 that they had objection to the appointment of Mr. Icot or considered such an appointment as illegal. Their advocates on being contacted on telephone informed that they had no instructions from the petitioner for appearance. The arbitral tribunal on 2.7.1999 fixed the hearing of the arbitration matter on 23.7.1999 and informed the parties. Counsel submitted that for the first time the petitioner by letter dated 20.7.1999 raised objections to the appointment of Mr.Icot and to the continuance of the arbitration proceedings as the time for making and publishing the award had expired long back. The petitioner did not attend the hearing on 23.7.1999 and the objections raised by him in the letter addressed to the respondent no.2 arbitrator was considered and rejected by the arbitrators. Thereafter, the arbitral tribunal fixed the hearing on 7.8.1999 at Mumbai and informed the petitioner's counsel on 2.8.1999. The date of hearing on 7.8.1999 was cancelled on the request made by the advocate of the respondent no.1 since he was not well. Thereafter, the proceedings were stayed under an exparte order for stay of the proceedings granted by this court on 10.8.1999. It is argued that from the above facts it is clear that the conditions precedent to the exercise of the power to appoint a new arbitrator by a party in terms of clause(a) Section 9 were present so the appointment of Mr. Tapas Icot replacing Mr. Khandwala as arbitrator is perfectly in order. Even otherwise it is argued that the petitioner has acquiesced to the appointment of Mr.Icot since the petitioner even after coming to know that Mr.Icot was appointed by the petitioner on 20.3.1997 and Mr. Khandwala formally resigned on 30.7.1999 participated in the proceedings before the two arbitrators but raised objections about the appointment of Mr. Icot only on 20.7.1999 for the first time.

8. To controvert, the counsel for the petitioner strongly relying upon the provisions of Section 5 & 9 of the Act argued that the appointment of Mr.Icot, respondent no.3 before the revocation of the authority by Mr. Khandwala contravened Section 5 of the Act and clause (a) of Section 9 of the Act. According to him Mr. Khandwala's letter dated 30.7.1997 has falsified the allegation of the respondent no.1 that he was incapable of acting as arbitrator for health ground. But he has not disputed the facts which have been pointed out by the counsel for the respondent no.1. In fact these facts also borne out from the documents placed on record by the parties.

9. The question for consideration, therefore is whether the appointment of Mr. Tapas Icot, respondent no. 3 on 20.3.1997 before Mr. Khandwala resigned on 30.7.1997 and his joining the arbitral tribunal conducting proceedings after 30.7.1997 is illegal and the proceedings conducted by the arbitral tribunal null and void. The arbitration agreement between the parties is at page 20 of the paper book. It is extracted below:-

Arbitration Agreement:-

a) In the event of any dispute/disputes arising under or out of or relating to the construction, meaning, operation or effect of this contract or breach thereof, the matters in dispute shall be referred to two arbitrators-one each to be nominated by the parties contracting herein and in case of the said arbitrators not agreeing then an umpire to be appointed by the arbitrators in writing. The decision of the arbitrators or in the event of their not agreeing, of the umpire shall be final and binding on the parties to the contract.

The provisions of the Indian Arbitration Act and the rules made there under shall govern the proceedings. The arbitrators or the umpire as the case may be, shall be entitled with the consent of the parties to enlarge the time from time to time for making and publishing the award. The venue of the arbitration shall be New Delhi. The award shall be a reasoned award.

b) The party invoking the arbitration clause shall do so by serving on the other party a notice by registered post specifying the disputes and quantifying its claims categorical terms addressed to General Manager (Law), of India Limited, SCOPE Complex, Core-I, 7 Institutional Area, Lodhi Road, New Delhi-110003 if the claim is against MMTC and Shri...................(the name and designation of the person/representative with its full address) if the claim is against the other party. The other party shall have the right to submit its counter claims if any.

10. The above agreement postulated the appointment of one arbitrator by each of the two parties, the petitioner and the respondent no.1 herein. It also provided for two arbitrators, if they disagree, to appoint an umpire. The arbitration agreement did not provide revocation of the authority of an arbitrator by the parties themselves. On strict and narrow interpretation of Section 5 of the Act the authority of Mr. A.K. Khandwala, who was appointed as arbitrator by the respondent no.1, could not have been revoked unilaterally without the intervention of the court. But the facts of the present case are peculiar. The respondent no.1 indeed did not approach the court for revoking the authority of Mr. Khandwala under Section 5 of the Act. Application under Section 11 of the Act was also not filed for removal of Mr. Khandwala on any ground on which the arbitrator appointed by the party could have been removed under sub Section (1) of Section 11 of the Act. But it is not disputed that Section 9 empowered a party to provide a substitute to an arbitrator in certain contingencies. Section 9 reads as under:-

Where an arbitration agreement provides that a reference shall be to two arbitrators, one to be appointed by each party, then, unless a different intention is expressed in the agreement,-

a) If either of the appointed arbitrators neglects or refuses to act, or is incapable of acting, or dies, the party who appointed him may appoint a new arbitrator in his place;

b) if one party fails to appoint an arbitrator, either originally or by way of substitution as aforesaid, for fifteen clear days after the service by the other party of a notice in writing to make the appointment, such other party having appointed his arbitrator before giving the notice, the party who has appointed an arbitrator may appoint that arbitrator to act as sole arbitrator in the reference, and his award shall be binding on both parties as if he had been appointed by consent.

11. Provided that the Court may set aside any appointment as sole arbitrator made under Clause (b) and either, on sufficient cause being shown, allow further time to the defaulting party to appoint an arbitrator or pass such other order as it thinks fit.

11. It is vehemently argued on behalf of the petitioner that a new arbitrator could not have been appointed by the respondent no.1 in exercise of the power given by Section 9 above because it has not been established that the arbitrator appointed by it had 1) neglected; 2) refused to act; 3) was incapable of acting or (4) had died. Pointing to the letter of Mr. Khandwala dated 30.7.1997 annexure R4 to the petition wherein he had asserted that he was capable of acting as an arbitrator and his health did not prevent him from discharging his normal duties. The counsel has argued that Mr. Khandwala had contradicted the allegations of the respondent no. 1 made in its letters to the contrary. It is, therefore, argued that appointment of Mr. Tapas Icot replacing Mr. A.K. Khandwala even before he resigned as arbitrator was in breach of the statutory provision so it is illegal.

12. In the letter dated 30.7.1997 Mr. A.K. Khandwala who had settled in London, U.K after his appointment as an arbitrator has not denied that he was sick and was suffering from high blood pressure and that he did not have cardiac surgery earlier. He wanted the respondent no. 1 to pay his business class air fare for attending the arbitral tribunal's hearing in India on health ground. Annexure R1 to the reply of respondent no. 1 is a letter dated 18.3.1997 which was sent by the respondent no. 1 to Mr.Khandwala. In the letter telephonic conversation held on 24.2.1997 is referred and it has also been mentioned that Mr. Khandwala has expressed his inability to have the hearing of the matter on a date prior to October, 1997 on the ground that he had been medically advised not to travel to India till then in view of the heart operation that he had undergone recently. It is also mentioned that the parties were not agreeable to such a long postponement of the proceedings since it would cause prejudice. The letter also states that Mr. Khandwala was ready to resign as arbitrator but wanted payment of his fee and expenses. From the letter it is clear that Mr. Khandwala had shifted his residence to London after his appointment as an arbitrator by the respondent no.1. It is also clear that Mr. Khandwala had a heart operation and he had been advised against traveling to India or at least he could travel to India on health ground in the comfort of a higher class in the aircraft. The letters also discloses that Mr. Khandwala had intention to resign from arbitral tribunal but insisted on payment of the amount of fee and expenses demanded by him. It seems the respondent no.1 was unwilling to pay the big sum demanded by him since no proceedings in the arbitration reference were actually conducted. Saddling the respondent no.1 with airfare that too in higher class, from London to India to hold arbitration proceedings apparently seemed to be unjust. The respondent no.1 could not have foreseen such a high expenditure when Mr. Khandwala was appointed. Mr.Khandwala also wanted the arbitral tribunal to hold meeting after October, 1997. It would have also caused inordinate delay in conduct of proceedings. When Mr. Khandwala had some physical incapacity to proceed with the matter expeditiously and offered to resign, respondent no.1 would be justified in assuming that Mr. Khandwala has become incapable of acting as arbitrator giving right of appointment of a new arbitrator as replacement so that the arbitration proceedings are held without delay. Annexure R2 to this reply is addressed to the counsel for the petitioner and stated that consequent upon the inability of Mr. Khandwala appointed by the claimant to proceed expeditiously in the matter on account of his health and travel restrictions and his intention to resign as arbitrator respondent no.1 had appointed Mr. Tapas Icot as arbitrator to replace him. Mr. Khandwala shifted to London, medical advice restricted his air travel to India and the expenses of procuring his presence in the tribunal seemed unreasonable. There is sufficient material on record to suggest that Mr. Khandwala was incapable of acting as an arbitrator which gave requisite power to the respondent no.1 to appoint a new arbitrator in his place under Section 9(a) of the Act. Respondent no.1 appointed Mr.Tapas Icot in his place on 18.3.1997. This appointment being in accordance with Section 9 cannot be called in question only because Mr. Khandwala sent formal resignation from the office of arbitrator on 30.7.1997. Provisions of Section 5 and 11 have not been violated in this case.

13. Moreover it is not disputed on behalf of the petitioner that the respondent no.1 could have appointed a new arbitrator in place of Mr. Khandwala after 30.7.1997 when Mr.Khandwala tendered his resignation. In other words appointment of Mr.Icot after 30.7.1997 would have been legal. In the instant case Mr. Khandwala seems to have expressed his intention to resign as arbitrator on receipt of his dues etc as appears from the letter of the respondent no.1 sent to Mr. Khandwala on 18.3.1997. Respondent no.1 actually paid the dues of Mr. Khandwala later upon which Mr. Khandwala submitted his formal resignation. Expecting his resignation the respondent no. 1 appointed Mr.Tapas Icot as arbitrator. Be that as it may the appointment of Mr. Tapas Icot on or after 30.7.1997 would have been in accordance with Section 9 of the Act and perfectly legal even according to the petitioner. In the peculiarity of the facts and circumstances the irregularity, if any, which was committed by the respondent no.1 stood regularised and the appointment became legal after 30.7.1997. The court cannot be hypertechnical in declaring the appointment of Mr. Icot as arbitrator in March, 1997 as illegal when his appointment after 30.7.1997 would have been legal. No formal order for reappointment was necessary to make it legal after 30.7.1997. For this reason also the appointment of Mr. Icot as arbitrator cannot be held to be illegal or in breach of Section 5 or 11 of the Act.

14. There is another aspect of the matter. Even after coming to know about the appointment of Mr. Icot as a replacement arbitrator to Mr. Khandwala by respondent no.1 the arbitral tribunal remained functional. Petitioner never raised any objection to the reconstitution of the tribunal by the joining of Mr. Icot till 20.7.1999 a little before the instant petition was filed in August 1999. No good reason has been given by the petitioner for his arbitrator acting on the tribunal and his counsel representing him in the proceeding conducted by the said reconstituted tribunal till the present petition was filed.

15. Furthermore between 18.3.1997 and 30.7.1997 when Mr. Icot acted as arbitrator of the respondent no.1 on the arbitral tribunal only one meeting of some significance was held on 25.4.1997. The minutes of the meeting held on 25.4.1997 is annexure P5 to the petition. The two arbitrators one appointed by the petitioner and the other appointed by the respondent no.1 namely Mr. Icot decided to appoint Mr. Justice (Retd) D.M. Rege as umpire fixed their fee and it was also decided that the next meeting of the parties, if the parties gave their consent, will be held in Mumbai but if the consent was not forthcoming then it will be held in New Delhi. It is not denied that the counsel for the petitioner gave his consent to the meeting of the arbitral tribunal being held in Mumbai. It has also not been denied that no arbitration proceeding with umpire appointed by the arbitrators in this meeting was held during the period from 18.3.1997 and 30.7.1997. The appointment of the umpire was jointly by the two arbitrators. Any such appointment by them after 30.7.1997 could not have been objected to by the petitioner. Proceedings of the arbitral tribunal held after 30.7.1997 in which both the sides had participated could not be said to be hit by any of the statutory provision of the Act. The court has to adopt a pragmatic approach and not a narrow approach as the parties have chosen their own forum for resolving their dispute by arbitration. So long as the proceeding of the tribunal seems to be suiting the convenience of the petitioner it kept quiet and it challenged the proceeding when it did not serve the petitioner's purpose. The petitioner in this case obtained an exparte order of stay of the arbitral proceedings from this court in August, 1999 which is still in operation.

16. Having regard to the peculiarity of the facts and circumstances of the case and the reasons given above the appointment of Mr. Tapas Icot as arbitrator on the arbitral tribunal cannot be held to be in contravention of the provisions of the Act and illegal. It is not liable to be set aside.

17. As regards the decision of the arbitral tribunal dated 23.7.1999 it has already been held that the appointment of Mr. Icot as arbitrator is not illegal. On 23.7.1999 the petitioner's objection to the appointment of Mr. Icot were rejected by the tribunal. On 26.6.1999 proceedings were only adjourned to 23.7.1999. As regards the proceedings dated 25.4.1995 the same do not suffer from any legal infirmity as the appointment of Mr. Icot as arbitrator by the respondent no. 1 has already been held legal. Moreover, in case the petitioner is aggrieved by an order of the arbitral tribunal, other than rejection of the petitioner's objection to the appointment of Mr. Tapas Icot as arbitrator, the same may be agitated in appropriate proceeding.

18. Another contention of the petitioner is that the arbitrators have not made and published their award within time so their mandate stood determined. The petitioner for the first time raised objection to the expiry of time before the arbitral tribunal on 20.7.1999 which means that the petitioner was consenting party to the extension of the time in publishing the award at least till 20.7.1999. Even otherwise on going through the copy of the minutes of various meetings and the letters of the arbitrators it is clear that the delay is not attributable only to the arbitrators. The parties had also contributed to the delay. Since August, 1999 it is purely on the part of the petitioner who had obtained stay order from this court. It is an old dispute so it will be a traversity of justice if the arbitration proceedings by a forum chosen by the parties are scuttled on technicalities and the arbitrators are not allowed to proceed and announce the award. In these circumstances I am inclined to extend the time and allow the arbitral tribunal constituted by the parties to make and publish their award within the statutory time. Extended time for making the award will commence from the date on which the parties made their first appearance for a hearing before the arbitral tribunal.

19. In result the petition is dismissed.