M/S Woodfun vs Union Of India
2009 Latest Caselaw 2351 Del

*           IN THE HIGH COURT OF DELHI AT NEW DELHI


                                            Date of Reserve: May 22, 2009
                                               Date of Order: May 29, 2009

+OMP 439/2006
%                                                      29.05.2009
    M/s Woodfun                            ...Petitioner
    Through : Mr. Sandeep Sharma, Advocate

       Versus

       Union of India                              ...Respondent
       Through: Ms. Preeti Dalal, Advocate


       JUSTICE SHIV NARAYAN DHINGRA

1.     Whether reporters of local papers may be allowed to see the
       judgment?

2.     To be referred to the reporter or not?

3.     Whether judgment should be reported in Digest?


       JUDGMENT

This petition has been made by the petitioner under Section

34 read with Sections 11, 38 and 39 of the Arbitration & Conciliation Act,

1996 (for short, "the Act") with a prayer that this Court should terminate

the mandate of the Arbitrator Mr. C.B. Lal on the ground that the learned

Arbitrator had asked the petitioner to pay to him half of the amount of

Rs.2,58,700/-, as the interim bill of his fee.

2. The arbitrator in this case was to be appointed by respondent

Union of India, who initially appointed Shri Y.P.C. Dange as arbitrator.

After sometime Mr. Dange resigned and in his place Shri A.K. Singhal was

appointed as the arbitrator who entered upon the reference and

proceeded with the case till completion of pleadings. Thereafter, he also

OMP 439/2006 M/s Woodfun v Union of India Page 1 Of 2 resigned and Mr. C.B. Lal, the present arbitrator was appointed. Mr. C.B.

Lal fixed hearing of the matter on 31st July 2006 and on that date asked

each of the parties to deposit half of his bill of professional fees and costs.

The petitioner has placed on record hand written note of Mr. C.B. Lal.

3. In this case, since it is Union of India who appointed the

present arbitrator and the earlier arbitrators, in terms of arbitration

agreement the arbitrator so appointed should have been a serving officer

and in case it was not a serving officer and was a retired officer, Union of

India should bear the expenses of the arbitration. The arbitrator, while

passing the award can always make an order qua costs. The mandate of

the arbitrator cannot be terminated on the ground of higher fees being

charged by him. Section 14 and 15 lay down specific grounds on which

the mandate of the arbitrator can be terminated. Charging exorbitant fee

is not a ground for termination of mandate of the arbitrator.

4. If the present arbitrator continues, the respondent shall bear

the costs of the arbitration and the arbitrator while passing the award may

make an order in respect of the costs of the arbitration.

The petition stands disposed of in above terms.

May 29, 2009                                 SHIV NARAYAN DHINGRA J.
rd




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