IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION ORDINARY ORIGINAL CIVIL JURISDICTION ORDINARY ORIGINAL CIVIL JURISDICTION WRIT PETITION NO.1533 OF 2007 WRIT PETITION NO.1533 OF 2007 WRIT PETITION NO.1533 OF 2007 Rajesh Shah .. Petitioner Versus Hemendra V. Kothari & Ors. .. Respondents Mr.Birendra Saraf alongwith Mr.Ashish Kamath i/by M/s.Kartikeya and Associates for petitioner. Mr.A.K.Koltli for respondent No.3. CORAM: S.C.DHARMADHIKARI CORAM: S.C.DHARMADHIKARI CORAM: S.C.DHARMADHIKARI J. J. J. DATE : 17th June, 2008 DATE : 17th June, 2008 DATE : 17th June, 2008 P.C. P.C. P.C. 1. Heard Mr.Saraf appearing for the petitioner and the learned advocate appearing for contesting respondent No.3. 2. The order under challenge is passed by the Arbitral Tribunal consisting of a sole arbitrator. The order terminates the arbitral proceedings. The arbitrator has taken recourse to section 25(a) of the Arbitration and Conciliation Act, 1996. 3. The petitioner is the original claimant. He had approached this Court by filing an Arbitration petition being Arbitration Petition No.251 of 2006 under section 9 of the Arbitration and Conciliation Act, 1996. Initially an order was made in that petition on 07th :2: July, 2006. Thereafter, the petition was placed before a learned single Judge of this Court on 23rd August, 2006. By consent of parties the following order was passed: "By consent of parties, petition is disposed of in following terms: 1. By consent of parties, Hon’ble Mr.Justice V.P.Tipnis (Retd.) is appointed as an arbitrator. The disputes between the parties are referred to the arbitrator to decide in accordance with law. 2. Ad-interim order granted by this court by order dated 07th July, 2006 shall continue to operate for a period of eight weeks. The learned counsel appearing for the Respondents states that even before this petition was filed the Respondents have created third party interest in the month of February, 2006 in favour of Riving Land Development Pvt.Ltd. Statement is accepted. 3. The petitioner shall be at liberty to :3: seek appropriate interim orders from the learned arbitrator." 4. Thus, by consent of parties a retired Judge of this Court was appointed as an arbitrator. The matter was placed before the arbitrator and in the meeting that was convened by him on 30th September, 2006 he issued directions. The directions are issued both to the original claimant-petitioner before me and the respondents. The order in that behalf reads thus: 1. The claimant shall file their claim alongwith copies of all the documents on which they rely on or before 15th November, 2006. The claimant shall simultaneously serve a copy of the claim and all the accompanying documents on the respondents on or before 15th November, 2006. 2. The respondents shall file their written statement and counter claim, if any, alongwith all the documents on which they rely on or before 29th November, 2006. The respondents shall serve the copy of the written statement and counter claim if any alongwith documents on which they rely upon the claimants on or before 29th November, 2006. :4: 3. The claimant shall file their reply to the counter claim of the respondents if any alongwith documents on which they rely on or before 13th December, 2006. Claimant shall serve the copy of reply alongwith all the documents on the respondents on or before the same date. 4. The parties shall communicate to each other the documents which are admitted and/or disputed on or before 21st December, 2006. 5. Further date for determining the points at issue shall be fixed after pleadings are completed. 6. Reading charges of Rs.8,000/- shall be paid to the Arbitrator within 6 weeks from today. The said charges will be shared by the parties equally. 7. The hearing charges of the Arbitrator shall be Rs.35,000/- per day or part of the day which shall be shared equally by the parties. 8. All other expenses of the arbitration :5: proceedings shall be shared by the parties in equal proportion. 9. Aforesaid order is passed and dates have been fixed by consent of the parties." 5. It is undisputed that the entire schedule was fixed by consent of parties. It is an admitted position that the petitioner- claimant did not file the Statement of Claim before the date stipulated in the above order. It is also not in dispute that no application was made prior to the stipulated date, that is, 15th November, 2006 for extension of time. On 15th November, 2006 the Advocate for the petitioner claimant addressed the following communication to the learned arbitrator: "We refer to the meeting held on 30th September, 2006, when Your Lordship had directed us to file the statement of claim alongwith copies of all documents relied upon by our clients on or before 15th November, 2006. We regretfully state that we are unable to file the same as our Mr.K.G.Desai who is attending to the above matter was travelling out of Bombay and resumed office only last week. In the circumstances, we have to request your Honour to kindly extend the time for :6: filing the Statement of Claim by a period of three weeks from today. We shall be filing the Statement of Claim on or before 06th December, 2006. We regret for the inconvenience caused to the Hon’ble Arbitral Tribunal and Respondents." 6. The arbitrator has on 12th February, 2007 made the order impugned in this petition on the basis that the application for extension of time was made by the above letter dated 15th November, 2006. The petitioner claimant stated before the arbitrator that three weeks extension be granted and the Statement of Claim will be filed positively on or before 06th December, 2006. The petitioner claimant did not do so. The arbitrator ultimately addressed the impugned communication/letter in which he observed that in the light of the failure and negligence to file Statement of Claim he has no alternative but to terminate the aforesaid arbitral proceedings. Accordingly, proceedings are terminated. It was also recorded that the petitioner claimant has failed to abide by clause 6 of the order dated 20th September, 2006. The respondents’ advocate had forwarded a cheque of Rs.40,000/- towards the arbitral fees but the arbitration being terminated the learned :7: arbitrator cancelled the said cheque and did not encash it. 7. Now, Mr.Saraf makes twofold grievance. His first contention is that Arbitral Tribunal is performing a public duty. He can, therefore, come within the term "person" under Article 226 of the Constitution of India and more particularly sub-article 1 thereof. A writ of certiorari therefore would go to the Arbitral Tribunal and this Court can consider the challenge to the order terminating the proceedings. In other words, the Writ Petition is maintainable. Reliance is placed upon a judgment of this Court in the case of M/s.Anuptech Equipments Private Ltd. Vs. M/s.Ganpati Co-operative Housing Society Ltd. & Ors. reported in (1999(2) BCR Page 331). 8. The second submission of Mr.Saraf is that the learned arbitrator was in error in terminating the proceedings. He submits that the arbitrator was duly communicated the inability to file Statement of Claim and he had extended the time. Even otherwise, the matter could have been considered sympathetically. In the submission of Mr.Saraf, the petitioner has fully abided by the interim order and directions of this Court. The money has been deposited in this Court. :8: This Court with a view to expedite the resolution of the dispute between parties thought it fit to refer the matter to arbitration. The course suggested and adopted by this Court was with consent of parties. In such circumstances, now relegating the petitioner to a suit and taking away his right to proceed with the arbitral proceedings will result in grave miscarriage of justice and therefore, this Court should interfere in writ jurisdiction. 9. I am unable to accept this contention of Mr.Saraf. Without entering into any larger controversy and issue and assuming that present Writ Petition is maintainable, in my view, this is not a fit case for exercising the equitable, discretionary and extra-ordinary jurisdiction under Article 226 of the Constitution of India in favour of the petitioner. 10. The petition itself proceeds on the admitted facts. This Court appointed an arbitrator by consent of parties on 23rd August, 2006. The learned arbitrator promptly accepted the appointment and placed the matter for issuance of preliminary directions. He issued preliminary directions on 30th September, 2006, which directions were issued by consent of both sides. Time was given to complete filing of pleadings. It is not :9: disputed before me that time granted for filing of Statement of Claim i.e from 30th September, 2006 to 15th November, 2006 was fair and reasonable. It ensured that the petitioner-claimant had sufficient time to peruse the record and consult the lawyers so also file his Statement of Claim. That apart, the communication dated 15th November, 2006 addressed to the arbitrator does not set out any reason as to why the claimant could not file Statement of Claim or in any event could not make any application for extension before the returnable date. In the communication, what is stated is that the claimant’s advocate was travelling out of Bombay and resumed work in the week prior to the date of the letter i.e 15th November, 2006. Therefore, a request was made to extend the time by three weeks. Now, it is clear that the arbitrator did not pass any order on this application and therefore, parties proceeded on the basis that the time was extended by three weeks. However, the arbitrator waited till February 2007 and still no steps were taken to file the Statement of Claim. 11. Despite all this Mr.Saraf would urge that the arbitrator was obliged to issue a show cause notice to parties before terminating the proceedings. Reliance was placed by him on section 25(a) and a decision of the :10: Andhra Pradesh High Court. The submission is that the Arbitration and Conciliation Act provides for consequences in case of default of a party. The termination of proceedings by the arbitrator is a drastic step. Therefore, before such a step is resorted to and the proceedings are terminated by the Arbitral Tribunal it should give sufficient opportunity to the party. 12. In the peculiar facts of this case, I have declined to go into these aspects and therefore Mr.Saraf was not heard in further details. Even otherwise, the petitioner is not prejudiced by the action of the arbitrator terminating the proceedings. He had enough notice in the matter. He is aware of the consequences in law. He knew he is in default and made a belated request for extension of time.Even after the extended period he took no steps in the matter. His conduct exhibits disinterest and scant regard for the directions issued by the arbitrator. This is not a case where the petitioner claimant was not aware of the default committed by him. He has admitted that there was a default. That is why after the stipulated date i.e 15th November, 2006 the communication was addressed. The arbitrator showed leniency and did not take any action. But even within the extended period no steps having :11: being taken by the petitioner, the arbitrator was constrained to terminate proceedings and that is how the communication/letter addressed by him to petitioner on 12th February, 2007 proceeds. It was not expected of the arbitrator in the peculiar facts of this case to wait indefinitely. More so, when his communication records that there is no compliance by the petitioner-claimant with the directions issued on 30th September, 2006 and more particularly with regard to payment of reading charges. Having accepted the assignment as early as in August 2006 the Arbitral Tribunal waited for compliance of its directions. It is not as if he has terminated the proceedings only for non-payment of his fees. The learned arbitrator was aware of the fact that one of the parties has deposited the fees. However, the petitioner-claimant having not taken steps to file his Statement of Claim the arbitrator was of the opinion that the matter cannot proceed further. He waited for the petitioner and his advocate to file the Statement of Claim. When he found that the petitioner was not serious in abiding by the directions and is not desirous of expeditious resolution of the dispute through arbitration that finally he passed the order terminating the proceedings. He was fair to parties in as much as he did not encash the cheque forwarded by the respondents. :12: 13. In the peculiar facts of this case and considering the conduct of the petitioner-claimant, I do not find that the arbitrator was in error in terminating the proceedings. The petitioner never raised the ground of his illness earlier. If he was under medical treatment he could have moved the Tribunal and requested for further time. In a Writ Petition, for the first time, the ground of illness is introduced. The medical certificates are of December 2006 and January 2007. However, the arbitrator waited till February 2007. Therefore, neither is his decision erroneous or vitiated as urged nor could it be said to be perverse or based on no material. The law confers him with the power which is exercised on justifiable grounds. The decision to terminate cannot be termed as unfair, unjust or unreasonable either. Needless to observe that when parties resort to Arbitration and the Court proceeds to appoint arbitrators by consent, then, it is expected that they desire expeditious resolution of the disputes. An arbitrator steps in so that the matters can be decided expeditiously. A reference to arbitration should not drag on like civil suits. If the intent of the arbitrator is to instil sense of urgency in the proceedings, then, default of parties must result in the consequences provided in law. One who is in default :13: cannot turn around and blame the arbitrator for Termination of the proceedings on account of his conduct. In such circumstances, this is not fit case for exercising writ jurisdiction. Petition is dismissed. No costs. (S.C.Dharmadhikari, J)