THE HON'BLE SRI JUSTICE NOOTY RAMAMOHANA RAO WRIT PETITION No : 11217 of 2009 Date: 20.10.2010 BETWEEN: Sri Valli Shipping and Transport, Rep.by its Managing partner, Smt.Polina Sri Vallika Subrahmanyeswari W/o. Babu Rao … Petitioner and Hindustan Shipyard Limited (A Government of India Undertaking) Gandhigram, Visakhapatnam and another … Respondents THE HON'BLE SRI JUSTICE NOOTY RAMAMOHANA RAO WRIT PETITION No : 11217 of 2009 O R D E R: This writ petition is directed against the order passed on 02.04.2008 by the first respondent – Hindustan Shipyard Limited substituting the second respondent herein as arbitrator in place of one Sri R.Ravi Chandran, who is appointed as an arbitrator earlier, to resolve the disputes between the writ petitioner and the first respondent and in view of the fact that the said Sri R.Ravi Chandran has resigned on 17.01.2008. Heard Sri P.Prabhakar Reddy, learned counsel for the petitioner and Sri S.V.Bhatt, learned counsel for the respondents. It would be appropriate right at this stage to notice that in terms of Section 15 of the Arbitration and Conciliation Act, 1996(for short ‘the Act’) the mandate of an arbitrator shall terminate where he withdraws from that office for any reason. In the instant case, Sri R. Ravi Chandran has withdrawn to function as an arbitrator. Therefore, his mandate has been terminated by virtue of Section 15(1)(a) of the Act. Sub-section 2 of Section 15 of the Act enables substitute arbitrator to be appointed where the mandate of an earlier arbitrator is terminated. Hence, in exercise of the power available under Sub- section 2 of Section 15 of the Act, the second respondent herein came to be appointed as substitute arbitrator by the first respondent, through the impugned order. Therefore, no exception can be taken to the exercise of the power by the first respondent in appointing the second respondent as a substitute arbitrator. However, learned counsel for the petitioner would submit that the first respondent Hindustan Shipyard has already laid a claim against the insurance company and when the said insurance company has repudiated the contract, it raised a dispute before the consumer forum and the matter is currently engaging the attention of the National Commission for Consumer Redressel and hence, the first respondent Hindustan Shipyard Limited could not have raised a parallel claim against this petitioner before the Arbitrator. I am afraid this contention cannot be examined in this proceeding and the merits of the dispute are not liable to be adjudicated upon in this writ petition. The appointment of an arbitrator is essentially the result of an agreement existing between the parties to that effect. If an arbitrator has already been appointed and if the said arbitrator’s mandate is terminated, a substitute arbitrator can also be appointed. Whether the claim laid before the arbitrator is tenable or not is a question that has got to be examined by the said arbitrator. Further, both parties would be entitled to lead appropriate evidence in support of their respective claims. Therefore, the tenability or otherwise of a claim before the arbitrator cannot be gone into at this stage. Such a factor cannot be invoked for challenging the appointment of an arbitrator. When once it is not disputed that there is an agreement between the parties, which provides for resolution of disputes between the parties by way of reference to an arbitrator and the procedure for making such an appointment is followed, then such an appointment of an arbitrator cannot be challenged in a writ petition, on the ground of lack of tenability of the claim. Hence, this writ petition is dismissed at the admission stage. It is needless to observe that dismissal of this writ petition does not amount to expression of any opinion on tenability or otherwise of the claims or counterclaims by the parties, which are liable to be adjudicated upon on their respective merits by the learned arbitrator. No order as to costs. ---------------------------------- Nooty Ramamohana Rao, J 20th October 2010 Rns