ASHOK KUMAR GHOSH Vs. STATE OF WEST BENGAL

JUDGEMENT

(1.) The essential facts are not in dispute. Disputes and differences have admittedly arisen between the parties and are covered by the arbitration clause contained in the agreement between them. In terms of the arbitration agreement, the petitioner sought the appointment of an arbitrator by a letter dated October 11, 2010 which was received by the appointing authority on the same day. The present request under section 11(6) of the Arbitration and Conciliation Act, 1996 was carried to this Court on November 22, 2010. The appointing authority, a chief engineer of the relevant department, annointed himself as the arbitrator in accordance with the arbitration agreement on November 24, 2010. A copy of the present petition was served on the respondent on or after November 24, 2010. The petitioner says that upon the expiry of a period of 30 days from the date of a valid request for the constitution of an arbitral tribunal in accordance with the relevant arbitration agreement, the addressee would lose the authority to appoint or participate in the process of the appointment of the arbitrator or the constitution of the arbitral tribunal. It is on such ground that the petitioner insists that the Chief Justice or his designate is free under section 11 of the 1996 Act to appoint any person as arbitrator, notwithstanding the agreement. The relevant part of the arbitration agreement requires a request to be made by the contractor to the chief engineer of the concerned department and for the chief engineer to cither take up the reference himself or appoint another as arbitrator. No qualifications as to who may be appointed as arbitrator are indicated in the agreement.

(2.) The chief engineer in this case took it upon himself to adjudicate the disputes covered by the arbitration agreement that had arisen between the parties. In course of this request remaining pending in Court, the person then manning the office of the chief engineer has been transferred from the post and, as such, an arbitrator is per force to be appointed. Though the petitioner insists that in view of the judicial interpretation of section 11 of the 1996 Act, an appointing authority would lose the mandate to appoint an arbitrator after the expiry of a period of 30 days from the date of receipt of the request for appointment, it is evident from section 11 of the Act that there is no statutory command in such regard. In Datar Switchgears vs. Tata Finance Ltd., 2000 8 SCC 151, it was held that the reasonable period which an appointing authority may be afforded to sit upon a request should be 30 days. Such interpretation was obviously inspired by section 11(4) of the Act. Section 11(4) of the Act refers to subsection (3) thereof. Sub-section (3) of section 11 covers a situation where there is no agreed procedure for the appointment of an arbitrator or the constitution of an arbitral tribunal. It is in such context that sub-section (4) recognises that a party to an agreement may request the other party thereto to appoint an arbitrator or the two arbitrators appointed may agree on the third arbitrator. The period in case of either limb of sub-section (4) is 30 days. Neither sub-section (3) nor sub-section (4) of section 11 covers a situation where there is an agreed mechanism for the constitution of an arbitral tribunal and the appointing authority as agreed upon by the parties fails to make the appointment within a period of 30 days from the date of receipt of a request in such regard.

(3.) It matters little, in the context of section 11 of the Act and the general tenor of the statute, as to whether the appointing authority is an officer or employee of one of the parties to the arbitration agreement.