Container Corporation Of India vs D.R. Sood Of Sood And Sood
2005 Latest Caselaw 1293 Del

ORDER

1. The petitioner is aggrieved by an order dated 30th May, 2005 passed by the learned Single Judge in AA No. 110/2005 under Section 11(6) of the Arbitration Act appointing Justice Usha Mehra, a former Judge of this Court as an arbitrator to adjudicate the claims and counter-claims of the parties.

2. The petitioner's case is that under the arbitration clause three arbitrators were required to be appointed. As per the impugned order, the designated authority has appointed one arbitrator only. It is submitted by learned counsel for the petitioner that one of the two additionally appointed arbitrators be appointed from the petitioner corporation.

3. This petition is contested by the respondent and its counsel Mr. Sharma contends by placing reliance on State of Orissa v. Gokulananda Jena, , that it is open to the petitioner to raise the issue of the constitution of the arbitral tribunal before the already appointed arbitrator under Section 16 of the Arbitration and Conciliation Act. It is also submitted that since the petitioner has not raised this issue before the designated authority, the corporation cannot be allowed to raise it in this petition.

4. Both contentions raised by learned Counsel for the respondent are liable to be rejected. Firstly, because arbitration clause admittedly provides for the appointment of three arbitrators. Secondly, the appointment of an arbitral tribunal under Section 11(6) of the Act is not an issue which can be raised before the arbitrator.

5. The relevant arbitration clause reads thus:

"64(3)(a)(ii) In cases not covered by Clause 64(3)(a)(i), the arbitral tribunal shall consist of a panel of three Gazetted Rly. Officers not below JA grade, as the arbitrators."

6. This clause provides for the appointment of three arbitrators and, therefore, any adjudication of claims and disputes will have to be conducted by three arbitrators as per this clause. If the designated authority has inadvertently or otherwise missed out on the appointment of the other two arbitrators, it has not acted in conformity with the arbitration clause.

7. After hearing learned counsel, this petition is disposed of and the impugned order is modified by appointing Justice C.K. Mahajan (Retd.) and Mr. Ajay Kumar, Group General Manager of the Corporation as arbitrators in addition to the arbitrator appointed by the designated authority, Justice Usha Mehra (Retd.) who shall be the presiding arbitrator.

8. Parties to appear before the arbitrator on 28th September, 2005.