DHAN RAJ JETHWANI Vs. UNION OF INDIA

JUDGEMENT

(1.) [Ed. facts : Petitioner filed an application u/Ss. 14 and 17 of Arbitration Act on 20.9.82 for directing Arbitrators, Respdts. 2 and 3 to file the award dt. 6.8.82. Respdt. 3 filed the proceedings stating the award was handed over to the petitioner on 6.8.82. U.O.I. filed objections contending that application was barred by time, that arbitrators did not appoint Umpire as agreed and also as required by R. 2 of 1st Schedule of the Act and that award was not properly stamped. One of the arbitrators filed an affidavit that original award was given to petitioner on 6.8.82. The Court believed this and held that as application u/Ss. 14, 17 was not filed within a month, same was barred.] After detailing above, Judgment is :-

(2.) ANOTHER objection raised in the objection petition is that the arbitration clause appearing in the contract contemplated appointment of an Umpire before the two arbitrators were to enter upon reference and as no Umpire was appointed at any time, the award given by the two arbitrators is vitiated. The learned counsel for the respondent has placed reliance on a number of judgments in support of his contention.

(3.) THE learned counsel for respondent No. 1 has contended that in the present case, it is not the requirement of clause 2 of Schedule I of the Act which vitiates the award but is the non-compliance of the agreement between the parties which contemplated appointment of umpire by the two arbitrators before entering upon the reference. THE learned counsel for respondent No. 1 forgets that even in the agreement between the parties there is no provision made that if the umpire is not appointed the arbitration proceeding shall stand vitiated. THEre is no penal consequences contemplated by the parties in the agreement. No prejudice has been caused to respondent 1 for inability of the arbitrators to appoint the umpire inasmuch as the two arbitrators were, in fact, the employees of respondent 1. Moreover, repondent No. 1 had ample opportunity to take resort to provision of Section 8 of the Arbitration Act for getting the umpire appointed even before the two arbitrators proceeded with the arbitration proceedings and respondent 1 for reasons known to respondent 1 failed to avail the opportunity and thus, it does not lie in the mouth of respondent 1 to urge that the award stands vitiated for non-appointment of umpire by the arbitrators. Such an objection, if any, available to respondent No 1 stands waived by respondent 1. I agree with the reasonings given by majority of the High Courts in coming to the conclusion the requirement of appointment of umpire may be in clause 2 of Schedule I is not mandatory and for parity of reason, I hold that even requirment of appointment of umpire as contemplated in the agreement between the parties is not mandatory. THE Single Judge of this Court also in Chowdhury and Gulzar Singh vs. Frick India Ltd. AIR 1979 Delhi 97, has held that a failure of the arbitrators to appoint an umpire under clause 2 is a breach curable by the procedure prescribed by S. 8 of the Arbitration Act itself and if a party fails to follow the procedure permitted by the Statute to remedy the breach and stands by till the award is made he cannot later on put forward non-appointment of an umpire as a ground for setting aside the award. Similarly, in the present case, respondent 1 could have taken resort to S. 8 for getting the umpire appointed and on its failure to have resort to the said section now amounts to waiver on the part of respondent 1 in challenging the award on the ground of non-appointment of umpire. Various judgments of other High Courts have been considered in this judgment I have already referred above. So, I also agree with the view expressed in this judgment of our High Court and hold that the provision contained in Rule 2 Schedule I and similar provision contained in the agreement between the parties regarding appointment of umpire is not mandatory and if it is to be held to be mandatory the aggrieved party could take resort to provision of S. 8 for getting the umpire appointed and failure to do so would amount to waiver of the party to such an objection. Hence, I find no merit in this particular objection of respondent No. 1,