TMI Blog2008 (8) TMI 974X X X X Extracts X X X X X X X X Extracts X X X X ..... ermination of this question in turn raises the question as to when the arbitrator entered upon the reference for that is the starting point mentioned in the agreement for computing the period within which the award is to be made. Mr. Bharucha, the learned senior counsel appearing on behalf of the Respondent submitted that the arbitrator entered upon the reference on 19.4.2002. In the alternative he submitted that the arbitrator entered upon the reference on 28.5.2002. In the further alternative he submitted that the arbitrator entered upon the reference on 28.6.2002. Mr. Kamdar, the learned senior counsel appearing on behalf of the petitioner, on the other hand submitted that the arbitrator entered upon the reference on 16.10.2002. As I will demonstrate, irrespective of when the arbitrator is deemed to have entered upon the reference, the petitioner had waived the stipulation in the arbitration agreement as to the time within which the award is to be made. However as the matter has been argued on the basis of all these dates and submissions have been made on the basis of the arbitrator having entered upon the reference on each of these dates I will deal with the same. 4. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing of that expression in Clause 91(b) on 19.4.2002, alternatively on 28.5.2002 and in any event on 28.6.2002. Irrespective of which of these three dates is taken into consideration it would make no difference to the Respondents case based on waiver as the event of waiver relied upon by them occurred on 13.8.2002 i.e. more than three years after each of these dates. 8. Thereafter issues were settled on 16.10.2002 by the arbitrator and the proceedings continued. According to Mr. Kamdar, the arbitrator entered upon the reference, within the meaning of that expression in Clause 91(b) on 16.10.2002. 9. By an application dated 10.3.2006 filed before the arbitrator the petitioner contended that the mandate of the arbitrator had come to an end and therefore applied for the termination of the arbitration proceedings. The learned arbitrator by an undated order rejected the contention. The arbitrator based his decision upon Section 21 of the Arbitration and Conciliation Act, 1996 which reads as under: 21. Commencement of arbitral proceedings. -Unless otherwise agreed by the parties, the arbitral proceedings in respect of a particular dispute commence on the date on which a request f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... trator noted in the minutes of the said meeting that as per law he had to decide whether the contention was valid or not and observed that accordingly the further course of action would be decided. 15. Mr. Bharucha submitted that the arbitrator had entered upon the reference on this date. There is however nothing to indicate that the learned arbitrator actually applied his mind on this date. The minutes of this meeting merely state that the contention had been raised by the petitioner. The mere reference to the fact of a contention having been raised by a party does not ipso facto indicate any application of mind on the part of the arbitrator. If however the arbitrator had applied his mind no doubt he must be deemed to have entered upon the reference, within the meaning of that expression, irrespective of the extent to which the arbitrator had applied his mind. The extent of application of mind would be irrelevant in this regard. 16. However as noted above, for the purpose of determining the question of waiver it matters not whether the arbitrator is deemed to have entered upon the reference on 19.4.2002 or 28.5.2002. The third meeting of the arbitrator was held on 28.5.2002 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the question as to whether or not his appointment is valid and legal and accordingly whether or not he therefore is entitled to act as an arbitrator/his appointment is valid and legal cannot be said to be a ministerial act. It is most certainly an adjudicative act. Such questions may not pertain to the facts in issue qua the agreement, the implementation thereof and the other disputes between the parties. But questions as to jurisdiction and the validity of the appointment of arbitrators are also controversies between the parties arising the out of the main dispute or the procedural aspects in the disposal thereof. The ratio of the Division Bench does not limit the adjudicative acts only to those which relate to questions other than those pertaining to jurisdiction and the validity of the appointment of arbitrators. 18. In the circumstances the arbitrator must be deemed to have entered upon reference, within the meaning of that expression even under the 1940 Act when he first applied his mind to the petitioners application dated 19.4.2002. He did this on 28.5.2002. Thus in my view the arbitrator entered upon reference on 28.5.2002. 19. Mr. Kamdar submitted that such a vie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t had not even completed its reply. Yet, there was no objection to the same by the petitioner. Further, the fourteenth meeting was held before the arbitrator on 13.8.2005. At this meeting the Respondent completed its oral arguments. As recorded in the minutes of the meeting the Respondent was directed to submit its written submissions by 13.9.2005. The date of the next meeting was to be fixed by mutual agreement between the petitioner and the Respondent after the submission of the written arguments by the Respondent. There was no objection to any of this by the petitioner. In fact the petitioner agreed to the same. The petitioner did not contend that the time stipulated in the agreement had come to an end and that thereby the arbitrators mandate had also come to an end. 23. Mr. Kamdar however submitted that at the very next meeting held on 11.3.2006 the petitioner had raised an objection. He submitted that the fact that the petitioner had attended a solitary meeting could not constitute waiver. I do not agree. 24. It is true that if a party attends a number of meetings after the time for making the award has expired it would be a strong indication of waiver. However the stren ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he stipulation as to time that it was further agreed between them that the next meeting would be fixed by mutual agreement between themselves. There is no other explanation for the parties having consented before the arbitrators to fix the next meeting by mutual agreement between themselves. Nothing could be clearer to establish a case of waiver. 28. Further, as stated earlier, at the meeting held on 13.8.2005 the Respondent was directed to submit the written submissions by 13.9.2005. By a letter dated 13.9.2005 the Respondent requested for an extension of time up to 13.10.2005 to submit its written submissions. A copy of this letter was forwarded to the petitioner. The petitioner did not object to the request. The arbitrator by a letter dated 20.9.2005 agreed to the extension of time. A copy of this letter was also forwarded to the petitioner. There was no objection from the petitioner to the extension having been granted despite it being by now crystal clear to the parties that the award could never have been made by 16.10.2005. By a further letter dated 7.10.2005 the Respondent once again requested for extension of time upto 13.11.2005 to submit the written submissions. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e petitioner regarding the mandate of the arbitrator as having come to an end by efflux of time. Secondly there is nothing that prevented the petitioner for making the said application even before the next meeting. The fact that the petitioner did so only on 11.3.2006 indicates that the same was an afterthought. The contention was taken far too late. It ought to have been taken before the petitioner and the Respondent had waived the stipulation as to the time for making the award. 35. In Shyam Telecom Ltd v. ARM 2004 (3) ALR 146 it was found that the Petitioner had waived its right to object to the continuance of the arbitration proceedings by having participated therein and not having raised the objection even after the time for making the award had expired. A learned single judge of the Delhi High Court held: 19. Mr. Rajiv Nayar in support of his contention that the petitioner will be deemed to have waived its right to object within the meaning of Section 4 of the Act, has sought support from the Supreme Court decision in the case of Narayan Prasad Lohia v. Nikunj Kumar Lohia and Ors. MANU/SC/0114/2002MANU/SC/0114/2002 (SO ; Inder Sain Mittal v. Housing Board MANU/SC/0117/2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of waiver in the event of failure to object. For example, Sub-sections (2) and (3) of Section 16 are one of such mandatory provisions. Section 16(2) of the Act provides that a plea that the Arbitral Tribunal does not have jurisdiction shall be raised not later than the submission of the statement of defense. Section 16(3) of the Act provides that a plea that the Arbitral Tribunal shall be raised as soon as the matter alleged to be beyond the scope of its authority is raised during the Arbitral proceedings. 22. In the opinion of this Court, these arguments of the learned Counsel for the petitioner cannot be accepted ; firstly, because having regard to the totality of the facts by no stretch it can be said that the Article IV(3) of the Divestment agreement was not to the knowledge of the petitioner and, therefore, they could not object to the continuation of the proceedings after the expiry of the stipulated period. Not only that, no objection was raised about the continuation of the Arbitral proceedings but the petitioner continued to participate in substantive proceedings before the Arbitrator up till the final stage of the proceedings. In the opinion of this Court, these fac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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