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TMI Blog2012 (11) TMI 41X X X X Extracts X X X X X X X X Extracts X X X X ..... Calcutta High Court was ordered to be impleaded as party respondent. 4. In the matter of Hindustan Copper Limited, by an order dated 18.7.2012 this Court felt that the views of the Registrar General, Calcutta High Court were necessary as the issue involved was whether an application under Section 11(6) of the 1996 Act for appointment of an arbitrator could be considered in piecemeal by two Designate Judges. 5. In the matter of Hindustan Copper Limited, one Designate Judge first passed the order on 9.6.2011 holding that the request for appointment of the arbitrator was proper and then ordered that the application should be referred to Hon'ble Delegate of the Chief Justice for appointment of an arbitrator. The relevant part of the order dated 9.6.2011 reads as under : "Therefore, the request for appointment of arbitrator was proper. There is an arbitral dispute between the parties, as held above. I also notice that the petitioner have not appointed their arbitrator, which they ought to have done by this time. Therefore, in the circumstances, I think this application should be referred to the Hon'ble delegate of the Hon'ble the Chief Justice for appointment of an arbitrator/arbi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sideration of the matter. According to him, it is permissible that the Designate Judge considers the general power of the court to determine whether the pre-conditions for the exercise of that power have been fulfilled leaving the power of naming the arbitrator under Section 11 to the exclusive jurisdiction of the Chief Justice. He submits that this is in conformity with the Division Bench decision of the Calcutta High Court in Modi Korea Telecommunication Ltd. v. Appcon Consultants Pvt. Ltd. 1999 (II) Cal. H.C. Notes 107. 10. Section 11 of 1996 Act provides for the appointment of arbitrators. It reads as under: "S. 11. Appointment of arbitrators.-(1) A person of any nationality may be an arbitrator, unless otherwise agreed by the parties. (2) Subject to sub-section (6), the parties are free to agree on a procedure for appointing the arbitrator or arbitrators. (3) Failing any agreement referred to in sub-section (2), in an arbitration with three arbitrators, each party shall appoint one arbitrator, and the two appointed arbitrators, shall appoint the third arbitrator who shall act as the presiding arbitrator. (4) If the appointment procedure in sub-section (3) applies and- (a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion (5) or sub-section (6) to the Chief Justices of different High Courts or their designates, the Chief Justice or his designate to whom the request has been first made under the relevant sub-section shall alone be competent to decide on the request. (12) (a) Where the matters referred to in sub-sections (4), (5), (6), (7), (8) and (10) arise in an international commercial arbitration, the reference to "Chief Justice" in those sub-sections shall he construed as a reference to the "Chief Justice of India." (b) Where the matters referred to in sub-sections (4), (5), (6), (7), (8), and (10) arise in any other arbitration, the reference to "Chief Justice" in those sub-sections shall be construed as a reference to the Chief Justice of the High Court within whose local limits the principal Civil Court referred to in clause (e) of sub-section (1) of section 2 is situate and, where the High Court itself is the Court referred to in that clause, to the Chief Justice of that High Court." 11. The Division Bench of the Calcutta High Court in Modi Korea Telecommunication Ltd.1 was concerned with the question of the jurisdiction of a Single Judge who has been given the power for determinatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ustice of India or any person or institute designated by him is given the powers of appointment. Section 11(11) deals with a situation where several requests are made to the Chief Justices of different High Courts or their designates. Section 11(12)(a) extends the operation of sub-sections (4), (5), (6), (7), (8) and (10) to International Commercial Arbitrations giving power of appointment to the Chief Justice of India in place of Chief Justice of the High Court. Section 11(12)(b) clarifies that the reference to Chief Justice means the Chief Justice of the appropriate High Court. 51. What does "appointment" mean-is it only limited to naming or does it include the adjudicatory process as to whether appointment should be made? 52. It is clear from a reading of section 11 that the word "appoint" has been used in section 11 to mean nomination or designation. Thus parties may appoint or name their arbitrator under Section 11(2), (3) and (4). The parties do not, in appointing an arbitrator, do more than name or designate him. 53. The power which has been conferred exclusively under section 11 on the Chief Justice is the power of appointment or the power to name an arbitrator. The Chi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... udes the High Court in exercise of its ordinary Civil Jurisdiction, having jurisdiction to decide the question forming the subject matter of the reference if the same had been the subject matter of a suit, but does not include any Civil Court of a grade inferior to such principal Civil Court, or any Court of Small Causes." 12. The Division Bench then considered Section 14 of the High Court Act, 1861, Clause 36 of the Letters Patent, Chapter V Rule 1 of the Original Side Rules and Article 225 of the Constitution of India and in paragraph 64 of the Report concluded as under : "64. Pursuant to this power the Chief Justice has allocated the business of hearing matters pertaining to arbitrations to a Learned Single Judge. It is for that Learned Single Judge to exercise the general power referred to earlier, leaving the power of naming the arbitrator under section 11 to the exclusive jurisdiction of the Chief Justice." 13. We find merit in the submission of Mr. Gourab Banerji, learned senior counsel for one of the appellants that the view taken by the Division Bench of Calcutta High Court in Modi Korea Telecommunication Ltd.1 is completely knocked out by a majority decision of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce of India. Therefore, we clarify that the Chief Justice of a High Court can delegate the function under Section 11(6) of the Act to a Judge of that Court and he would actually exercise the power of the Chief Justice conferred under Section 11(6) of the Act. The position would be the same when the Chief Justice of India delegates the power to another Judge of the Supreme Court and he exercises that power as designated by the Chief Justice of India. 43. In this context, it has also to be noticed that there is an ocean of difference between an institution which has no judicial functions and an authority or person who is already exercising judicial power in his capacity as a judicial authority. Therefore, only a Judge of the Supreme Court or a Judge of the High Court could respectively be equated with the Chief Justice of India or the Chief Justice of the High Court while exercising power under Section 11(6) of the Act as designated by the Chief Justice. A non-judicial body or institution cannot be equated with a Judge of the High Court or a Judge of the Supreme Court and it has to be held that the designation contemplated by Section 11(6) of the Act is not a designation to an insti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... will have the right to decide the preliminary aspects as indicated in the earlier part of this judgment. These will be his own jurisdiction to entertain the request, the existence of a valid arbitration agreement, the existence or otherwise of a live claim, the existence of the condition for the exercise of his power and on the qualifications of the arbitrator or arbitrators. The Chief Justice or the designated Judge would be entitled to seek the opinion of an institution in the matter of nominating an arbitrator qualified in terms of Section 11(8) of the Act if the need arises but the order appointing the arbitrator could only be that of the Chief Justice or the designated Judge." 17. The exposition of law by a seven-Judge Bench of this Court in SBP & Co. , leaves no manner of doubt that the procedure that is being followed by the Calcutta High Court with regard to the consideration of the applications under Section 11 of the 1996 Act is legally impermissible. The piecemeal consideration of the application under Section 11 by the Designate Judge and another Designate Judge or the Chief Justice, as the case may be, is not contemplated by Section 11. The function of the Chief Just ..... X X X X Extracts X X X X X X X X Extracts X X X X
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