2016 (3) TMI 1027 - SC - Indian Laws

Appointment of Arbitrator - Held that - Averments made in the petition must, in the absence of any counter from the respondent, be taken to be correct at least for the purposes of deciding whether the matter ought to be referred to an Arbitrator. This is especially so when the averments are supported by an affidavit filed by the petitioner. In that view, therefore, we see no reason to decline the prayer for appointment of an Arbitrator made by the petitioner. We, accordingly, appoint Hon ble Mr. Justice H.S. Bedi, former Judge of the Supreme Court of India as the sole Arbitrator to adjudicate upon the disputes that have arisen between the parties. The Arbitrator shall issue notices to the parties in connection with the arbitral proceedings. He is left free to determine his fee. We make it clear that we have expressed no opinion on the merits of the case which aspect is left open for the parties to urge before the worthy Arbitrator.

Summary

Issues:
Appointment of an arbitrator under Section 11(6) of the Arbitration and Conciliation Act, 1996 based on an arbitration clause in an Engagement Letter dated 24th October, 2013.

Analysis:
The petition before the Supreme Court was made under Section 11(6) of the Arbitration and Conciliation Act, 1996, as the respondent did not contest the appointment of an arbitrator as per the arbitration clause in the Engagement Letter dated 24th October, 2013. The arbitration clause specified that any disputes would be settled through arbitration in Mumbai, India, in accordance with the Arbitration Act. The petitioner had requested the respondent to name an arbitrator to adjudicate the disputes, but the respondent failed to do so, leading the petitioner to seek the appointment of an arbitrator from the Court.

The Court considered the absence of any counter from the respondent and the supporting affidavit filed by the petitioner. Given the uncontested nature of the petition, the Court accepted the petitioner's averments as correct for the purpose of deciding on the appointment of an arbitrator. The Court found no reason to decline the petitioner's request for the appointment of an arbitrator and proceeded to appoint Hon'ble Mr. Justice H.S. Bedi, a former Judge of the Supreme Court of India, as the sole arbitrator to adjudicate on the disputes between the parties. The arbitrator was granted the authority to issue notices to the parties for the arbitral proceedings and determine his fee. The Court clarified that it had not expressed any opinion on the merits of the case, leaving this aspect open for the parties to present before the appointed arbitrator. No costs were awarded in this matter.