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2017 (7) TMI 1456 - CALCUTTA HIGH COURTInterpretation and application of Statute - Section 12(5) of the Arbitration and Conciliation Act, 1996 read with its Seventh Schedule - eligibility to be appointed as arbitrator. According to the arbitration clause the contractor had to choose two out of which the railways would appoint one as the arbitrator - this panel is challenged by the petitioner on the ground that it is against the permitted relationship of the arbitrator with the parties, mentioned in the fifth and seventh schedules. HELD THAT:- The general conditions of contract provide that the railways are to provide a list of more than three persons. But this condition is not followed as the highest Court desires it to be followed. The railways have forwarded only three names. They ought to prepare and furnish to a contractor a much longer and wider list. They should be given a wide choice amongst persons with different backgrounds and professional attainments - Therefore, the railways are required to furnish a longer list to the petitioner containing at least 30 names. Secondly, the arbitration clause provides that the railways can appoint any person from within or outside that panel. This stipulation is bad. The railways do not disclose the personnel from whom they would appoint their arbitrator. The Contractor does not know whether the appointed arbitrator of the railways would be disqualified under Schedules V and VII. Therefore, it is also imperative that the railways appoint an arbitrator from the panel sent to the petitioner or from a disclosed panel. This application is disposed of by setting aside the letter dated 24th February, 2017 (Annexure-m page 68 of the petition) by directing the respondent railways to forward a panel of at least 30 names, of persons of different backgrounds and professional avocations and attainments to the petitioner. It may include serving or retired officers of other organisations. From this panel the petitioner will be required to choose two. Thereafter, the railways can select one to be the contractor's nominee arbitrator.
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