Sun And Sons Construction Pvt. ... vs The State Of Jharkhand
2023 Latest Caselaw 2831 Jhar

 IN THE HIGH COURT OF JHARKHAND AT RANCHI
            Arb. Application No.39 of 2021
Sun And Sons Construction Pvt. Ltd., a Company registered under
the provision of Indian Companies Act having its registered office at
H.N. 106, Udgar Bhawan, Radhika Nagar, P.O. & P.S. Telco, Town
Jamshedpur, Dsitrict- East Singhbhum through its Managing Director
Arun Kumar Singh, aged about 58 years, son of Late Ram Udgar
Singh, resident fo H.No. 106, Radhika Nagar, P.O. & P.S. Telco,
Town-Jamshedpur, District-East Singhbhum...        ...    Applicant
                   Versus
1. The State of Jharkhand
2. Chief Engineer, Subarnrekha Multipurpose Project, Icha Galudih
   Complex, Adityapur, P.O. & P.S. Adityapur, District - Seraikella
   Kharsawan.
3. The Executive Engineer, Kharkai Dam Division No. 2, Icha
   Chaliyhama,    P.O.   and   P.S.   Adityapur,   District-   Seraikella
   Kharsawan             ...     ...      ...     ...    Respondents


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CORAM: SRI SANJAYA KUMAR MISHRA, C.J.

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For the Applicant: Mr. Shankear Lal Agarwal, Advocate For the Respondents: Ms. Surabhi, A.C. to A.A.G.-II

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12/Dated: 11.08.2023

1) By filing this arbitration application under Section 11(6) of the

Arbitration and Conciliation Act, 1996, the petitioner has prayed for

appointment of an arbitrator. However, it is not a dispute in the

case that on earlier occasion twice Arbitrators were appointed by

the Chief Engineer, but those Arbitrators recused themselves from

the case and did not conduct the case. Ultimately one Mr. Kishori

Rajak was appointed as a sole arbitrator vide order dated

03.04.2017. He took up the proceedings of arbitration and it was

concluded on 23.06.2018, but, said Mr. Rajak did not pass any

final order. Thereafter, the petitioner on 09.08.2021 requested the

sole arbitrator not to deliver any award as, in the meantime, three

years had passed and such award shall have no sanctity of law.

2) Learned counsel for the respondents would draw attention of the

Court to Section 14 of the Arbitration and Conciliation Act, 1996,

which reads as follows:

"14. Failure or impossibility to act.-- (1) The mandate of an arbitrator shall terminate and he shall be substituted by another arbitrator, if--

(a) he becomes de jure or de facto unable to perform his functions or for other reasons fails to act without undue delay; and

(b) he withdraws from his office or the parties agree to the termination of his mandate.

(2) If a controversy remains concerning any of the grounds referred to in clause (a) of sub-section (1), a party may, unless otherwise agreed by the parties, apply to the Court to decide on the termination of the mandate.

(3) If, under this section or sub-section (3) of section 13, an arbitrator withdraws from his office or a party agrees to the termination of the mandate of an arbitrator, it shall not imply acceptance of the validity of any ground referred to in this section or sub-section(3) of section 12."

3) Learned counsel for the respondents would also rely upon the of

judgment of the Hon'ble Supreme Court in the case of Swadesh

Kumar Agarwal vs. Dinesh Kumar Agarwal & Ors, etc., passed

in Civil Appeal Nos. 2935-2938 of 2022 decided on 05.05.2022,

wherein the Hon'ble Supreme Court has held that once the

Arbitrator was appointed by mutual consent and it was alleged that

the mandate of the sole arbitrator stood terminated in view of

section 14(1)(a) of the Act, 1996, the application under Section

11(6) of the Act, 1996 to terminate the mandate of the arbitrator in

view of section 14(1)(a) of the Act shall not be maintainable. The

Hon'ble Supreme Court has further held that once the appointment

of the arbitrator is made, the dispute whether mandate of the

arbitrator has been terminated on the grounds set out in Section

14(1)(a) of the Act shall not have to be decided by application

under Section 11(6) of the Act. Such a dispute cannot be decided

on an application under Section 11(6) of the Act and the aggrieved

party has to approach the concerned court as per as per sub-

section (2) of Section 14 of the Act. The Hon'ble Supreme Court

further relied upon the judgment passed on earlier occasion in the

case of Antrix Corporation Ltd. versus Devas Multimedia

Private Limited, 2014 (11) SCC 560.

4) In that view of the matter the application is disposed of by giving

liberty to the petitioner to approach the learned Principal District

& Sessions Judge, East Singhbhum for appropriate relief.

5) There shall be no orders as to costs.

6) Pending Interlocutory Applications, if any, stand disposed of.

7) Urgent Certified copies as per Rules.

(Sanjaya Kumar Mishra, C.J.) Manoj/MM