STATE OF HIMACHAL PRADESH Vs. PARSHOTAM LAL GUPTA

JUDGEMENT

(1.) "If any appointed arbitrator as per the arbitration clause neglects or refuses to act, or becomes incapable of acting or dies and the arbitration agreement does not show that it was intended that the vacancy should not be supplied, whether the powers of the appointing authority to appoint another Arbitrator afresh revive" is the basic but an important question which has arisen for the decision of this Court,

(2.) The petitioner Purshotam Lal was a supplier of water tanks and pipes to the Controller of Stores, Himachal Pradesh pursuant to a contract having been entered into in between them inter se as per the arbitration agreement. No doubt as per the arbitration clause both the parties contemplated reference of disputes to the arbitration to any officer appointed by the State of Himachal Pradesh acting as such at the time of reference and his decision is to be final and binding upon them. Admittedly disputes had arisen in between the parties and as per the clause the Financial Commissioner (Education) to the Government of Himachal Pradesh (Shri Attar Singh) was appointed to arbitrate and finally adjudicate upon the same vide notification dated 8th of May, 1987, later on duly published in the Himachal Pradesh Rajpatra.

(3.) The respondents moved an application registered as O. M. P. (M) No. 2 of 1990 under section 20 of the Arbitration Act for enlargement of time for making the award. Simultaneously the petitioner also filed an application registered as O. M P. No 217 of 1990 under sections 5, 11 and 12 of the Arbitration Act, 1940 seeking directions of this Court to revoke the authority of the abovesaid appointed arbitrator and to fill up the vacancy so created by appointing another arbitrator. The allegations made in the application for removal of the Arbitrator (Shri Attar Singh) are that he failed to use all reasonable despatch in entering on and proceeding with the reference and making an award It was alleged that he duly entered the reference on 28th of March, 1 87 and the parties filed their claims and counter claim on 2 -12 -1987 ; that earlier too, time for making an award was got enlarged by the parties by four months from 2oth July, 1988, onwards ; that after the said extension the Arbitrator fixed as many as seven hearings in between the period commencing from August, 3, 1988 till October 31, 1988 before the issues could be framed by him on 4 -11 - 1988 ; that all these adjournments except that of 3 -8 -1988 were allegedly necessitated because of either non -availability of the learned Counsel for the respondent or the administrative work of the Arbitrator ; that though the parties continued to participate in the proceedings despite the expiry of the period, yet no other proceedings in respect of the production of the evidence by the petitioner could be taken up. It is on account of the above said facts that removal of Arbitrator is prayed for due to having failed to use all reasonable despatch in entering upon the proceedings.