Arbitration Case.No.15/2014 21.04.2014 Shri Manoj Kushwaha, learned counsel for the applicant. Shri O.P. Namdeo, learned counsel for the respondent.
With the consent of learned counsel for the parties, the matter is heard finally.
By means of this application under Section 11(6) of the Arbitration and Conciliation Act, 1996, the applicant seeks appointment of an arbitrator.
Learned counsel for the applicant submits that non-applicant had issued a tender for supply of Wax Shellac. The applicant's tender was duly accepted by non-applicant on 28/6/2013. The non-applicant after a lapse of 32 days from date of the receipt of material, rejected the same on the ground that the same is below standard. The applicant sent a notice dated 21/12/2013 to the non-applicant for appointment of an arbitrator, however, the non-applicant failed to appoint the arbitrator, therefore, the applicant approached this Court.
On the other hand, learned counsel for the non-applicant submits that Director General, Ordnance Factories, who is competent authority to appoint an arbitrator, has appointed Mr. Rakesh Kumar Tiwari, Joint General Manager, Gun Carriage Factory, Jabalpur as an arbitrator, vide order dated 4/4/2014, therefore, the application has been rendered infructuous.
Learned counsel for the applicant submits that the right of the non-applicant to appoint an arbitrator has forfeited as the non-applicant has not appointed arbitrator within a period of 30 days from the date of receipt of notice.
I have considered the submissions made by learned counsel for the parties. Under the Arbitration Clause, admittedly, the Director General, Ordnance Factories, Government of India, Ordnance Factory Board, has authority to appoint an arbitrator. The applicant with his eyes wide open, has entered into agreement with the non-applicant which provides an arbitration clause. It is well settled in law that once a party has entered into an agreement with open eyes, it cannot wriggle out of the situation on the ground that the designated person being an officer of the other side would be not impartial or objective. (See ACE Pipeline Contracts (P) Ltd. V. Bharat Petroleum Corpn. Ltd., (2007) 5 SCC 304 and Indian Oil Corporation Limited and others V. Raja Transport Private Limited (2009) 8 SCC 520) . It is equally well settled in law that on failure of party to appoint arbitrator within a reasonable time, the Court should normally adhere the terms of the arbitration clause except in exceptional cases for the reasons to be recorded or where both parties agree for common name (see Bharat Sanchar Nigam Limited and another Vs. Motorola India Private Limited, (2009) 2 SCC 337) . In the instant case, learned counsel for the applicant was unable to point out any exceptional circumstance except contending that an arbitrator who has been appointed is an officer of the company and, therefore, he cannot be impartial and both the parties were unable to suggest any agreed name.
Accordingly, it is held that since the arbitrator has already been appointed by the competent authority under the arbitration clause, nothing survives for adjudication in the case.
Accordingly, the arbitration case is dismissed as infructuous.
(Alok Aradhe) Judge ts