Delhi High Court
Avneet Goyal vs Union Of India on 17 May, 2019
$~16 to 19
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of Decision : 17.05.2019
+ O.M.P. (T) (COMM.) 45/2019 & IA 6998/2019
AVNEET GOYAL ..... Petitioner
Through: Mr.Jai Sahai Endlaw, Mr.Gaurav
Aggarwal, Mr.Shivansh Soni, Ms.Deepika
Mishra, Advs.
versus
UNION OF INDIA ..... Respondent
Through: Mr.Rahul Sharma, Mr.C.K.Bhatt,
Mr.Pradeep Jha, Advs.
(17) O.M.P. (T) (COMM.) 46/2019
ATC FOOD PVT. LTD. ..... Petitioner
Through: Mr.Jai Sahai Endlaw, Mr.Gaurav
Aggarwal, Mr.Shivansh Soni, Ms.Deepika
Mishra, Advs.
versus
UNION OF INDIA & ORS. ..... Respondents
Through: Mr.Rahul Sharma, Mr.C.K.Bhatt,
Mr.Pradeep Jha, Advs.
(18) O.M.P. (T) (COMM.) 47/2019
MUBARAK OVERSEAS PVT. LTD. ..... Petitioner
Through: Mr.Jai Sahai Endlaw, Mr.Gaurav
Aggarwal, Mr.Shivansh Soni, Ms.Deepika
Mishra, Advs.
O.M.P. (T)(Comm.) Nos.45-46-47-48/2019 Page 1
versus
UNION OF INDIA & ORS. ..... Respondents
Through: Mr.Rahul Sharma, Mr.C.K.Bhatt,
Mr.Pradeep Jha, Advs.
(19) O.M.P. (T) (COMM.) 48/2019
MUBARAK OVERSEAS PVT. LTD. ..... Petitioner
Through: Mr.Jai Sahai Endlaw, Mr.Gaurav
Aggarwal, Mr.Shivansh Soni, Ms.Deepika
Mishra, Advs.
versus
UNION OF INDIA& ORS. ..... Respondents
Through: Mr.Rahul Sharma, Mr.C.K.Bhatt,
Mr.Pradeep Jha, Advs.
CORAM:
HON'BLE MR. JUSTICE NAVIN CHAWLA
NAVIN CHAWLA, J. (Oral)
1. These petitions have been filed by the petitioner(s) under
Section 14 of the Arbitration and Conciliation Act, 1996
(hereinafter referred to as the 'Act') praying for a declaration on
the termination of the mandate of the Sole Arbitrator appointed
by the respondent and for appointment of an independent Sole
Arbitrator to adjudicate the disputes.
2. The dispute between the parties is in relation to the
supply of Sharbati Rice by the petitioner(s) to the respondents.
O.M.P. (T)(Comm.) Nos.45-46-47-48/2019 Page 2
3. The petitioner(s) had earlier filed applications under
Section 9 of the Act. The petitioner(s), except in
OMP(T)(Comm.) No. 47/2019, had also filed applications
under Section 11 of the Act seeking appointment of an
Arbitrator. These petitions were disposed of by this Court on
the submissions made by the respondent that an Arbitrator has
already been appointed by the respondent for adjudicating the
disputes.
4. It is the case of the petitioner (s) that thereafter nothing
was heard from the Arbitrator. It is not denied that even the
petitioner(s) did not make any endeavour to enquire about the
arbitration proceedings or have them expedited.
5. The present petitions have been filed by the petitioner(s)
as the respondents, by the following letters against each of the
petitions, have appointed Mr.Ramesh Chander, Deputy Legal
Advisor & Arbitrator (DGS&D), as the Sole Arbitrator:-
OMP (T) OMP (T) OMP (T) OMP (T)
(COMM) (COMM) (COMM) (COMM)
45/2019 46/2019 47/2019 48/2019
18.02.2019 22.02.2019 & 21.02.2019 26.02.2019
25.02.2019
6. The Arbitrator by the following communications called
upon the petitioner(s) to file its Statement of Claims as also
O.M.P. (T)(Comm.) Nos.45-46-47-48/2019 Page 3
fixed a schedule for completion of pleadings and for hearing of
the disputes:
OMP (T) OMP (T) OMP (T) OMP (T)
(COMM) (COMM) (COMM) (COMM)
45/2019 46/2019 47/2019 48/2019
15.04.2019 30.04.2019 15.04.2019 15.04.2019
7. The petitioner(s) have filed the present petitions
challenging the appointment of Mr.Ramesh Chander as an
Arbitrator.
8. Counsel for the petitioner(s) submits that the appointment
having been made almost one year after the statement made by
the counsel for the respondents before this Court, is of no
consequence. Allowing the respondent to appoint an Arbitrator
would infact be granting benefit to the respondent of its own
wrong. He submits that Section 29A of the Act which provides
that the arbitration proceedings must culminate in an Award
within the period of one year, would stand defeated if such
appointments are to be allowed. He further submits that
Mr.Ramesh Chander has been appointed as an Arbitrator in
more than 115 cases by the respondents and therefore, would be
ineligible to act as an Arbitrator. He further placed reliance on
the order dated 11.01.2019 passed by this Court in
OMP(T)(Comm.) No.131/2018 titled Surinder Kumar Garg vs.
Union of India & Ors., wherein this Court had appointed an
O.M.P. (T)(Comm.) Nos.45-46-47-48/2019 Page 4
Arbitrator for adjudicating the disputes that have arisen between
the parties therein. He submits that the disputes in that
petition are similar to the ones that have arisen between the
parties herein and therefore, it would be in the fitness of things
that the same Arbitrator is appointed by this Court.
9. On the other hand, counsel for the respondent submits
that the respondent had appointed one Mr.Y.K.Singh by the
following appointment letters:-
OMP(T)(Co OMP(T)(Comm. OMP(T)(Comm.) OMP(T)(C
mm.) ) No.46/2019 No.47/2019 omm.)
No.45/2019 No.48/2019
23.02.2018 23.02.2018 and 23.02.2018 27.06.2018
and 01.03.2018
01.03.2018
10. He submits that Mr.Y.K.Singh never proceeded with the
arbitration proceedings and on his superannuation from service
in September, 2018, a need arose for appointment of a
substitute Arbitrator. He submits that exercising the right under
the Contract(s), the respondent has appointed the substitute
Arbitrator on the dates mentioned hereinabove.
11. He submits that the Arbitrator is otherwise not ineligible
under Section 12(5) of the Act read with the Seventh Schedule
and therefore, if the petitioner(s) have any grievance on his
O.M.P. (T)(Comm.) Nos.45-46-47-48/2019 Page 5
appointment, the only remedy of the petitioner(s) is to file an
application before the Arbitrator himself.
12. As far as the order dated 11.01.2019 passed by this Court
in OMP (T)(Comm.) No.131/2018 is concerned, he submits that
the same is distinguishable inasmuch as in the said case, the
respondent did not appoint an Arbitrator till the filing of the
petition but appointed the Arbitrator only after the petition had
been filed therein.
13. I have considered the submissions made by the counsels
for the parties.
14. As has been stated by the counsel for the respondent, the
respondent had appointed Mr.Y.K.Singh as an Arbitrator and
based on the statement of such appointment having been made
the petitions filed by the petitioner(s) under Sections 9 and 11
of the Act were disposed of.
15. Mr.Y.K.Singh never proceeded with the arbitration. It is
a matter of fact that the petitioner(s) also did not take any steps
for having the arbitration proceedings expedited before
Mr.Y.K.Singh. Infact, both the parties slept after the
appointment of the Arbitrator. On superannuation of
Mr.Y.K.Singh, it is stated that his mandate stood terminated
requiring the respondent to appoint a substitute Arbitrator.
Exercising its powers under Section 15(2) of the Act, the
respondent appointed the present Arbitrator by letters
O.M.P. (T)(Comm.) Nos.45-46-47-48/2019 Page 6
mentioned hereinabove. The Arbitrator has already entered
upon the reference and has issued notice to the parties for filing
of their pleadings as also for their appearance. Once the
substitute Arbitrator has already been appointed, unless such
Arbitrator is ineligible under Section 12 (5) of the Act read with
the Seventh Schedule to the Act, it would not be open to this
Court to interfere with such appointment. If the petitioner(s)
have any grievance on the appointment of the Arbitrator as to
the Arbitrator's independence or impartiality, their remedy has
to be in form of an application under Section 13 of the Act
before the Arbitrator himself. This is so held by the Supreme
Court in HRD Corporation vs. GAIL (India) Ltd. (2018) 12
SCC 471.
16. The submission of the counsel for the petitioner(s) that
almost more than one year has lapsed since the passing of the
orders in the earlier round of petitions and therefore, the
mandate of the Arbitrator, in any case, would have terminated,
is again of no relevance to the present petitions. Admittedly,
the present Arbitrator has entered reference only on the dates
hereinabove mentioned. Even otherwise, under Section 29A of
the Act, on the expiry of the period mentioned therein, it is the
mandate of the Arbitrator that terminates and not the arbitration
proceedings themselves. The substitute Arbitrator has already
been appointed by the respondent, therefore, the provision of
Section 29A of the Act can come to no avail of the petitioner(s).
O.M.P. (T)(Comm.) Nos.45-46-47-48/2019 Page 7
17. As far as the submission of the petitioner(s) that allowing
the respondents to appoint an Arbitrator at this stage would be
granting benefit to the respondents of their own wrong, the
same again has no force. As noted hereinabove, it is not the
case of the petitioner(s) that the petitioner(s) have also taken
any steps to expedite the arbitration proceedings. If anything,
they are equally guilty of the delay in the arbitration
proceedings.
18. The submission of the counsel for the petitioner(s) that
the Arbitrator so appointed has been appointed in other 115
cases also, may be relevant to be considered by the Arbitrator
himself in terms of the Fifth Schedule to the Act and cannot be
a ground to terminate his mandate in the present proceedings.
19. Reliance of the petitioner on the order dated 11.01.2019
passed in OMP(T)(Comm.) No.131/2018 is also of no avail
inasmuch as in the said case, the respondent had failed to
appoint an Arbitrator before filing of the petition. In those
circumstances, this Court relying upon the judgment in Datar
Switchgears Ltd. vs. Tata Finance Ltd. & Anr. (2000) 8 SCC
151, held that the respondent had forfeited its right to appoint
an Arbitrator and proceeded to appoint an Arbitrator. In the
present case, the respondent has appointed an Arbitrator before
filing of the present petitions and infact the present petitions are
challenging such appointment.
O.M.P. (T)(Comm.) Nos.45-46-47-48/2019 Page 8
20. In view of the above, while reserving the liberty of the
petitioner(s) to challenge the appointment of the Arbitrator in
accordance with law, the present petitions are dismissed.
NAVIN CHAWLA, J
MAY 17, 2019
RN
O.M.P. (T)(Comm.) Nos.45-46-47-48/2019 Page 9
