GENERAL MANAGER Vs. SESA SEAT INFORMATION SYSTEMS LTD

JUDGEMENT

(1.) AGGRIEVED by the orders passed by Hon'ble Chief Justice or his nominee Judge in Original Petitions filed under Section 11 of the arbitration and Conciliation Act, 1996 (hereinafter referred to as "the act"), appointing Arbitrators, Central Government organisations, namely, telecom Department, Southern Railway, Western Railway, Rajiv Gandhi National institute, etc. , have filed the above writ petitions.

(2.) WHEN the above Writ Petitions came up for final hearing before K. P. Sivasubramanian, J. , on 7-6-2005, the learned Judge, after referring to the several grounds raised by the petitioners as well as contesting respondents and the decision of the Supreme Court on the issues raised, found that the questions raised for consideration pertain to very important issues of interpretation of the provisions of the Act as well as interpreted by the Supreme Court and have impact not only on all these writ petitions, but also several Original Petitions pending before this Court for appointment of Arbitrators, and desired that these petitions be heard by a Larger bench. Pursuant to the same on the orders of the Honourable Chief Justice, the above Writ Petitions were heard by us.

(3.) (i) Mr. V. T. Gopalan, learned Additional Solicitor general of India by drawing our attention to specific clause/clauses in the agreement for appointment of arbitrator/arbitrators, would contend that either from officers of the concerned or independent arbitrator, the parties would be bound by such agreement and neither of the parties would be allowed to resile. He further contended that a conjoint reading of Section 11 (2) and (6) of the act makes it clear that there is no time stipulated for appointment of an arbitrator and the question of 30 days as per Section 11 (3) and (4) cannot be applied to a case governed by Section 11 (2) and (6 ). In other words, according to him, the time taken for appointment of an Arbitrator should be reasonable. In any event, according to him, neither the Chief Justice nor the designated judge have power to appoint any independent Arbitrator by passing the arbitration clause agreed to between the parties. He finally contended that inasmuch as the order passed by the Chief Justice and the designated Judge is administrative in nature, the writ would lie. ii) Countering the above arguments, Mr. Vijaynarayan, learned senior counsel and other counsel appearing for respondents, submitted that if an application is made, one of the parties to the agreement, after expiry of the period prescribed therein and in the absence of any response from other party, the Chief Justice or designated Judge has ample power to appoint independent arbitrator. He further contended that once arbitrator is appointed, in view of the statutory provisions, namely, Sections 5, 12 and 13, the said order cannot be interfered by any Court. In other words, according to him, once discretion is exercised, the same cannot be interfered by any one including by way of a judicial order. He also submitted that if the party or parties satisfied the conditions as per the terms of the agreement, the Chief Justice or designated Judge is free to appoint any one or body as Arbitrators and interference with the said orders is not permitted.