Facts of the case
In this case, the petitioner was granted the agreement of laying of the sewer line along with the railroad limit. The dispute arose between the parties and the petitioner vide its letter dated 03.09.2019 enforced the arbitration provision contained the General Conditions of the Contract (GCC) marked between the parties. On accepting the applicant's solicitation for the arrangement of an Arbitrator, as per the GCC, the respondent, vide its answer dated 19.09.2019, didn't deny that dispute has emerged between the parties yet mentioned the petitioner to concur for a waiver of Section 12(5) of the Act. The candidate needed the respondent to consent to the arrangement of a Gazetted Officer (JAG/SAG) of the respondent/Railways as the arbitrator.
The current petition recorded under Section 11 of the Arbitration and Conciliation Act, 1996 looks for the arrangement of an Arbitrator for settling of the conflict and contrasts that has emerged between the between thus relating to the arrangement of an arbitrator.
Whether the respondent can demand the appointment of a Gazetted Officer of Railways as the Arbitrator, particularly in the light of the apprehension communicated by the petitioner and the provision of Section 12(5) of the Act?
The contention of the parties
The petitioner contends that they have reasonable questions with respect to the unprejudiced nature of the arbitration procedures when the respondent's official has been proposed as the sole Arbitrator. He further presents that once the respondent knows that the arrangement of an official of the Railways as an Arbitrator would repudiate the arrangements of Section 12(5) of the Act, the respondent couldn't have guided the applicant to outfit a waiver.
The respondent contended that the postponement in referring the matter to arbitration is just because of the petitioner's inability to outfit the imperative waiver. He, subsequently, presents that the applicant is coordinated to outfit the imperative waiver, to empower the respondent to choose any Gazetted Officer (JAG/SAG) of the Railway as the sole Arbitrator, as per the conditions of the Contract.
The decision of the court
The court observed that the petitioner's worries with respect to the unbiasedness of the Arbitrator proposed to be designated by the respondent are legitimate. The court found that the respondent can't be permitted to contend that solitary a Gazetted Railway Officer should be delegated as the Arbitrator. Also, the respondent can't propel the candidate to outfit a waiver from invoking Section 12(5) of the Act. The request of the respondent to look for a waiver from the petitioner will frustrate the very purpose of Section 12(5) of the Act.
The petition is allowed for the arrangement of an autonomous Arbitrator under Section 11 of the Act. Furthermore, Mr.Siddhartha Shankar Ray, Advocate is named as the sole Arbitrator by the court to mediate the debates and disputes emerging between the parties. Court additionally said that before initiating intervention procedures, the Arbitrator will guarantee consistency of Section 12 of the Act and the charges of the Arbitrator will be represented by Schedule IV of the Act. The arbitration continuing will be directed under the aegis of the Delhi International Arbitration Centre (DIAC).