1 IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN JAIPUR BENCH, JAIPUR Balkishan & Anr. V/s. Smt Kamna Bhargav (S.B. CIVIL MISC. APPEAL No.1195/2010) S.B. Civil Misc. Appeal under Section 39 of the Arbitration Act, 1940 Date of Order :: April 29, 2010 HON'BLE MR.JUSTICE R.S.CHAUHAN Mr. A.K. Sharma for the appellants. Mr. N.K. Maloo for the respondent. Aggrieved by the order dated 19.03.2010 passed by the District & Sessions Judge No.1, Ajmer, whereby the learned Judge has set aside the award dated 31.12.2006 and has appointed Mr. Bhagwan Srivastava as the umpire, the appellant has challenged the same before this Court. The brief facts of the case are that the appellants, Balkishan and Naurat Mal and respondent, Smt. Kamna Bhargav, had formed a partnership firm. However, subsequently certain disputes arose between the appellants, on the one side, and the respondent, on the other side. In accordance with the partnership-deed, the disputes were referred to an arbitrator. On 03.07.2002, the arbitrator passed two different awards. However, the respondent challenged both the awards under 2 Section 30 and 33 of the Arbitration Act, 1940 (“the Act”, for short). While setting aside the award dated 03.07.2002, the learned Court appointed one Shri Kanhaiya Lal Rawat, Advocate, as the umpire. The umpire passed his award on 31.12.2006. However, the respondent challenged the said award again under Sections 30 & 33 of the Act and prayed for appointment of an unbiased and impartial umpire. Vide order dated 19.03.2010, the learned Court has set aside the award dated 31.12.2006 and has appointed Shri Bhagwan Srivastava, a retired District Judge, as an umpire. Since the appellants are aggrieved by the said order, they have approached this Court. The learned counsel for the appellants has contended that the respondent had challenged the impartiality of the umpire, Shri Kanhaiya Lal Rawat ostensibly on the ground that two counsel appearing for the appellants, namely, Mr. R.C. Jain and Mr. M.A. Chisti were appearing for the umpire, Shri Kanhiya Lal Rawat in a pending case. Because of this close relationship of a client and a lawyer, the umpire was partial towards the appellants. According to the learned counsel, mere relationship of a client and a lawyer does not create a presumption of partiality. Therefore, the learned Court was not justified in setting aside the impugned award and in appointing another umpire. Secondly, while appointing Shri Kanhaiya Lal Rawat as the umpire, the learned Court had sought a panel of 3 prospective arbitrators from both the sides. However, while passing the impugned order, the learned Court has not asked for panel of names. Instead, without assigning any reasons, it has appointed Mr. Bhagwan Srivastava as an umpire. Therefore, it has abandoned a procedure adopted by him on an earlier occasion. Lastly, the basis on which Mr. Bhagwan Srivastava has been appointed as an umpire is absolutely unclear. For, the learned Judge has not revealed any reason and has passed a cryptic order. Mr. N.K. Maloo, the learned counsel for the respondent, has contended that since Mr. R.C. Jain and Mr. M.A. Chisti were representing the umpire in a case pending before a Court, there is every likelihood of bias against the respondent and in favour of the appellant. Therefore, the learned Judge was certainly justified in setting aside the award. In order to buttress his contention, he has relied upon the case of Murlidhar Roongta & Ors. V/s. S. Jagannath Tibrewala & Ors. [2005 (1) LR 103 (Bombay)]. Heard the learned counsel, perused the impugned order and considered the case laws cited at the bar. It is, indeed, a settled position of law that every judicial and and quasi-judicial proceedings has to be fair and 4 impartial to both the parties. For, it is not sufficient that justice should be done, but most importantly it should manifestly appear to be done. Therefore, even the slightest possibility of bias would pollute the stream of justice. Thus, the applicant was justified in claiming that because of close relationship between the umpire and Mr. R.C. Jain and Mr. A.M. Chisti, a relationship of client and advocate, there was “a real likelihood” of the umpire being partial towards the defendants. Therefore, the learned Judge is certainly justified in setting aside the award dated 31.12.2006. However, the defendant is equally justified in claiming that justice should equally appear to be done to his side. Since, on an earlier occasion both the parties were asked to suggest the names of those persons whom they would like to appoint as umpire, the same procedure should have been followed by the learned Judge. A bare perusal of the order dated 19.03.2010 also reveals that the learned Judge has not given any reason for suddenly appointing Mr. Bhagwan Srivastava as the umpire. Since the consent of the parties has not been taken, as was done on the earlier occasion, this part of the order appointing Mr. Bhagwan Srivastava is wholly unjustified. Therefore, the appointment of Mr. Bhagwan Srivastava as an umpire is set aside. 5 Consequently, the parties are directed to appear before the learned District Judge, and to submit a panel of names, including the name of Mr. Bhagwan Srivastava, if so desired, before him. The learned Judge is free to appoint any of the persons so named in the panel as the umpire. With these observations, this appeal is partly allowed. (R.S.CHAUHAN)J. A.ASopa/-