9911796707
TMI Blog2023 (2) TMI 737X X X X Extracts X X X X X X X X Extracts X X X X ..... ent on 24/5/2017, under which the respondent was to provide application based platform to host and disseminate bulk SMS to end users of the petitioner. 2. As per the petitioner, the parties started performing their respective obligations under the agreement. However, certain disputes arose with respect to multiple invoices raised by the respondent, and this resulted in the respondent invoking arbitration clause and proposed the name of Mr.Amrut Joshi as Sole Arbitrator in the notice dated 16/1/2020. The petitioner did not agree to the appointment of the named arbitrator, and this resulted in the respondent approaching this Court under sub-section (6) of Section 11 of the Arbitration and Conciliation Act. By order dated 23/11/2022, Mr.Amrut Joshi was appointed as Sole Arbitrator to decide the disputes and differences, subject to the terms and conditions stipulated in the order. 3. The proceedings commenced before the learned Arbitrator after a date was fixed for preliminary hearing, and he made disclosure in the form mentioned in Vth Schedule of the Arbitration and Conciliation Act, 1996, inter alia, stating that he had no direct or indirect, past or present interest in relation t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pplicable as regards the disqualification or ineligible circumstances enumerated in Schedule VII of the Act. By inviting my attention to several circumstances enlisted in Schedule V, which give rise to justifiable doubts as to the independence and impartiality of Arbitrator, he would submit that by no stretch of imagination, it would be applicable to a counsel, who appear for distinct Attorneys in distinct proceedings, and it is not necessary to make a disclosure about such an appearance as a counsel, and that is the precise reason the Arbitrator has never made a disclosure statement. Mr.Khandeparkar has placed reliance on the decision of this Court in case of Sheetal Maruti Kurundwade Vs. Metal Power Analytical (I) Pvt. Ltd, 2017(6) Mh.L.J 642, and according to him, the observations made in the said decision would cover the case of the sole arbitrator like him, making it apparently clear that he has not incurred any disqualification. Further, Mr.Khandeparkar has placed on record a letter addressed by the applicant to the Arbitrator, where has asked for his recusal. He has also placed on record an order passed by the Arbitrator on 14/11/2022, on the communication received by him ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by another arbitrator, if- (a) he becomes de jure or de facto unable to perform his functions or for other reasons fails to act without undue delay; and (b)he withdraws from his office or the parties agree to the termination of his mandate." 10. Sub-section (2) of Section 14 prescribe that if a controversy remains, concerning to any of the grounds referred to in clause (a) of sub-section (1), party may apply to the Court to decide on the termination of mandate. It has therefore to be seen whether the petitioner has followed the aforesaid procedure when he wanted to challenge the appointment of the arbitrator on the ground that there was an incorrect disclosure and therefore, the Arbitrator has become de jure incompetent to continue with arbitration. For the first time, on 17/10/2022, the petitioner addressed a communication, intimating that they have gained knowledge that the Arbitrator was representing the counsel for the claimant Mr.Prabhakar Tandon and Ms.Sudha Dwivedi in an Interlocutory Application before the NCLT. Subsequently, it was revealed that the Arbitrator has been representing counsel for the claimant in several other matters, and therefore, a petition is fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nting out how I have been associated either with the Claimant (Netcore Cloud Pvt.Ltd) or with the subject matter of the present dispute which is pending before me in arbitration, in any other capacity or matter that I may have taken up as an advocate/counsel. I am therefore not inclined to accede to Mr.Dhirendra's request of keeping the arbitration proceedings in abeyance indefinitely". 14. The Arbitrator also permitted the respondent to file an application u/sec.12 r/w Section 13 of the Act and recorded as under :- "26 It is made clear that should the respondent file an application u/s.12 r/w Section 13 of the Act as stated in Mr.Dhirendra's email sent today, the same will be deal with in accordance with law. It is also made clear that the conduct of the parties is being noted by this Tribunal having regard to the provisions of Section 31-A of the Act for the purpose of determining costs that may eventually awarded to the concerned party in the final award". 15. The present petition is filed before this Court for termination of the mandate on the ground that the arbitrator stand disqualified, since he has represented the counsel for the respondents, and therefore, he has inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the issue of an arbitrator becoming ineligible in the following words : "12 After the 2016 Amendment Act, a dichotomy is made by the Act between persons who become 'ineligible' to be appointed as arbitrators, and persons about whom justifiable doubts exists as to their independence or impartiality. Since ineligibility goes to the root of the appointment, Section 12(5) read with the Seventh Schedule makes it clear that if the arbitrator falls in any one of the categories specified in the Seventh Schedule, he becomes "ineligible" to act as arbitrator. Once he becomes ineligible, it is clear that, under Section 14(1)(a), he then becomes de jure unable to perform his functions inasmuch as, in law, he is regarded as "ineligible". In order to determine whether an arbitrator is de jure unable to perform his functions, it is not necessary to go to the Arbitral Tribunal under Section 13. Since such a person would lack inherent jurisdiction to proceed any further, an application may be filed under Section 14(2) to the Court to decide on the termination of his/her mandate on this ground. As opposed to this, in a challenge where grounds stated in the Fifth Schedule are disclosed, which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the non-disclosure is fatal, but the disclosure, if accepted and waived, would not result in a disqualification. Section 12(5) speaks of ineligibility and it is linked to the VIIth Schedule; but the proviso to that sub-section again contemplates a possible waiver. 25. At the broadest level, no arbitrator should be involved in any manner with one of the parties to the dispute or a partner with a lawyer or law firm appearing in the arbitration, or representing the law firm or lawyer personally. 26. A law firm's briefing of counsel in other, unrelated matters is on a very different footing. In our profession it very often happens that on a given day a law firm will brief counsel for one client and on the very next day, or perhaps later that very day, will brief another counsel against the first. At no point in their regular practice do counsel appear 'for' the law firm that briefs them, leaving aside cases where the briefing lawyer or law firm is itself the litigant. In- house counsel or counsel who receive a fee-paid general retainer or salary from a law firm stand on a different footing. We are here concerned with independent counsel, those in the profession wh ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
