NIRANJAN LAL TODI Vs. NANDLAL TODI

JUDGEMENT

(1.) These petitions for the removal of an arbitrator are a sequel to a suit filed by the petitioner and his son in the year 2010 which was disposed of by allowing a plea under Section 8 of the Arbitration and Conciliation Act, 1996 carried by two of the defendants to the suit. The object of the petitioner's present exercise may be difficult to comprehend without reference to the suit and the order by which it was disposed of upon the subject-matter of the suit being recognised to be covered by an arbitration agreement.

(2.) The petitioner and his son instituted CS No. 121 of 2010 against the three brothers of the petitioner, the members of the families of such brothers and the several companies, partnership firms and proprietorship concerns that made up the Todi joint family business. The primary purpose of the suit was to challenge a memorandum of understanding executed by the petitioner and his brothers in the matter of the division of family assets. The memorandum of understanding of January 31, 2004 provides for a named arbitrator to adjudicate upon "all disputes and differences, mode and manner of implementation of matters in respect of which the parties have amicably resolved and all other connected and incidental issues or matters arising out of or in relation thereto." Clause 5 of the memorandum gives the arbitrator summary powers and dispenses with the obligation of the arbitrator to furnish reasons in support of the award. The arbitrator is also given the liberty to dispense with oral evidence, to take the advice or assistance of chartered accountants or valuers as he would deem fit and even given the "power to proceed ex parte, if any of the parties after reasonable notice fails or neglects to appear before the arbitrator." The arbitrator has been conferred the authority to issue directions for the "due fulfillment and implementation of the Award " Clause 7 of the memorandum, which is the primary plank of the petitioner's contention, provides as follows:

(3.) The earlier of the two petitions now falling for consideration was filed on August 25, 2010 at a time when the petition under Section 8 of the 1996 Act in CS No. 121 of 2010 had ripened for hearing or may even have been taken up for final hearing. Such earlier petition stood dismissed for default by an order of January 5, 2012 and a recent application for restoration of the earlier petition was dismissed on February 28, 2014, inter alia, on the ground that the petitioner took no interest in such petition and virtually abandoned the same on the impression that the "panacea for all the ills that the petitioner had suffered in this court would come from any order passed by the Supreme Court" in the petitions for special leave to appeal carried from the judgment and order of September 10, 2010 passed on the petition under Section 8 of the 1996 Act by which CS No. 121 of 2010 stood disposed of and the subject-matter of the suit was required to be decided in course of the pending arbitral reference. The order of February 28, 2014 dismissing the application to restore AP No. 483 of 2010 to the file was appealed against. The appellate court commented on the "lackadaisical" conduct of the petitioner, noticed that the petitioner herein does not carry on any business in India, that he had two finance companies that are now in liquidation, that misfeasance proceedings are pending against him and that he now resides in Dubai. The appellate court found the conduct of the petitioner herein to be "deplorable" but afforded him "one more opportunity" by making the following order: