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TMI Blog2019 (11) TMI 1281X X X X Extracts X X X X X X X X Extracts X X X X ..... disagreement shall at any time hereafter arise between the parties hereto or the respective or assigns in connection with or arising out of or in respect of contract, application of provision thereof, anything thereunder contained or arising thereunder or as to rights, liabilities or duties of the said parties hereunder or any matter whatsoever incidental to this contract shall be referred to the sole Arbitration of the person appointed by Director (Pers.) of NCL. CONTRACTOR shall have no objection to any such appointment that the arbitrator so appointed is an employee of NCL or that he had dealt with the matter to which the contract related and that in the course of his duties as NCL employees he has expressed views on all or any of the matter of disputes or difference. 13.2 If the arbitrator to whom the matter is originally by referred dies or refused to act or resigns for any reason from the position of arbitrator, it shall be lawful, for Director (Pers.) of NCL to appoint another person to act as Arbitrator. Such person shall be entitled to proceed with the reference from the stage at which it was left by his predecessor or to precede denovo. 13.3 It is agreed that no pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iled the present Special Leave Petition before this Court. 9. We have heard learned Counsel for the parties and perused the pleadings. 9.1. Section 21 of the 1996 Act provides that arbitral proceedings commence on the date on which a request for disputes to be referred to arbitration is received by the respondent. 9.2. In the present case, the Notice of Arbitration was issued by the Petitioner - Contractor to the Respondent - Company on 09.03.2016. The invocation took place after Section 11 was amended by the 2015 Amendment Act, which came into force on 23.10.2015, the amended provision would be applicable to the present case. 9.3. The 2015 Amendment Act brought about a significant change in the appointment process under Section 11 : first, the default power of appointment shifted from the Chief Justice of the High Court in arbitrations governed by Part I of the Act, to the High Court; second, the scope of jurisdiction under subsection (6A) of Section 11 was confined to the examination of the existence of the arbitration agreement at the prereference stage. 9.4. Prior to the coming into force of the 2015 Amendment Act, much controversy had surrounded the nature of the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arbitration, and leave the existence of the arbitration agreement to be finally determined by the arbitral tribunal." (emphasis supplied) 9.6. Based on the recommendations of the Law Commission, Section 11 was substantially amended by the 2015 Amendment Act, to overcome the effect of all previous judgments rendered on the scope of power by a non obstante clause, and to reinforce the kompetenzkompetenz principle enshrined in Section 16 of the 1996 Act. The 2015 Amendment Act inserted subsection (6A) to Section 11 which provides that : "The Supreme Court or, as the case may be, the High Court, while considering any application under subsection (4) or subsection (5) or subsection (6), shall, notwithstanding any judgment, decree or order of any Court, confine to the examination of the existence of an arbitration agreement." (emphasis supplied) By virtue of the non obstante clause incorporated in Section 11(6A), previous judgments rendered in Patel Engineering (supra) and Boghara Polyfab (supra), were legislatively overruled. The scope of examination is now confined only to the existence of the arbitration agreement at the Section 11 stage, and nothing more. 9.7. Rel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CC 525). If an arbitration agreement is not valid or nonexistent, the arbitral tribunal cannot assume jurisdiction to adjudicate upon the disputes. Appointment of an arbitrator may be refused if the arbitration agreement is not in writing, or the disputes are beyond the scope of the arbitration agreement. Article V(1)(a) of the New York Convention states that recognition and enforcement of an award may be refused if the arbitration agreement 'is not valid under the law to which the parties have subjected it or, failing any indication thereon, under the law of the country where the award was made'. 9.10. The legislative intent underlying the 1996 Act is party autonomy and minimal judicial intervention in the arbitral process. Under this regime, once the arbitrator is appointed, or the tribunal is constituted, all issues and objections are to be decided by the arbitral tribunal. 9.11. In view of the provisions of Section 16, and the legislative policy to restrict judicial intervention at the pre-reference stage, the issue of limitation would require to be decided by the arbitrator. Subsection (1) of Section 16 provides that the arbitral tribunal may rule on its own jurisdiction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e consent of Counsel for the parties, we appoint Mr. Justice (Retd.) A. M. Sapre, former Judge of this Court, as the Sole Arbitrator, subject to the declarations being made under Section 12 of the 1996 Act (as amended) with respect to the independence and impartiality of the arbitrator, and the ability to devote sufficient time to complete the arbitration within the period specified by Section 29A of the 1996 Act. 12. The arbitration agreement states that the arbitration will be at Singrauli, Madhya Pradesh. Consequently, the seat of arbitration is at Singrauli, subject to any modification that may be made by consent of the parties. The arbitrator is, however, at liberty to conduct the proceedings at a convenient venue as per the convenience of the arbitrator and the parties if so required. The Arbitrator will be paid fees in accordance with the Fourth Schedule of the 1996 Act. Both parties will share the costs of the arbitration equally. 13. The Registry is directed to despatch a copy of this Order to Mr. Justice (Retd.) A. M. Sapre, Former Judge, Supreme Court of India at the following address: "Mr. Justice (Retd.) A. M. Sapre, Former Judge, Supreme Court of India, C2 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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