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TMI Blog2014 (3) TMI 225X X X X Extracts X X X X X X X X Extracts X X X X ..... greement was terminated in terms of clause 64 of the General Conditions of Contract by which the agreement between the parties was governed. The twin reasons for termination of the contract were that the respondent initially delayed the commencement of the work and subsequently executed the work which was of inferior quality. Therefore, the appellant had to get the balance work completed from another contractor. On 24th July, 1996, the respondent raised certain claims against the appellant. On 30th September, 1996, the respondent demanded that the disputes be referred to arbitration. Since the disputes were not referred to arbitration, the respondent approached the High Court of Calcutta under Section 11(6) of the Arbitration and Concili ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e arbitrator was against the contractual conditions which cannot be ignored. Therefore, the reference was before a Arbitral Tribunal which had not been properly constituted. He also submitted that the arbitrator had no jurisdiction to entertain the claims with regard to certain excepted matters. On the other hand, the learned counsel for the respondent has submitted that the appellant having participated in the proceedings before the learned arbitrator without any demur or objection cannot now be permitted to raise the objection with regard to the jurisdiction of the arbitrator at this belated stage. Learned counsel further submitted that in view of express provision contained in Section 16 of the Arbitration Act, 1996, the Arbitral Tribun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... udge to decide whether or not the issues involved are of a complicated nature. 3(a)(ii) Two Arbitrators who shall be Gazetted Railway Officers of equal status to be appointed in the manner laid in Clause 64(3)(b) or all claims of Rs.5,00,000/- (Rupees five Lakhs) and above, and for all claims irrespective of the amount of value of such claims if the issues involved are of a complicated nature the General Manager shall be the sole Judge to decide whether the issues involved are of a complicated nature or not. In the event of the two Arbitrators being divided in their opinions the matter under disputes will be referred to an Umpire to be appointed in the manner laid down in Clause 3(b) for his decision. 3(a)(iii) It is a term of this contra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall nominate an Umpire who shall be a Gazetted Railway Officer to whom the case will be referred to in the event of any difference between the two arbitrators Officers of the Junior Administrative grade of the Accounts Department of the Railways shall be considered as of equal status to the Officers in the intermediate administrative grade of other departments of the Railway for the purpose of appointment as arbitrators." A persual of clause 64 would show that in case of claims which are below Rs.5,00,000/- (Rupees five lakh), the General Manager or a Gazetted Railway Officer nominated by him shall be the sole arbitrator. In case of claims of Rs.5,00,000/- (Rupees five lakh) and above, the Arbitral Tribunal shall consist of three arbitra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aim against the respondent. Since the appellant has not raised the objection with regard to competence/jurisdiction of the Arbitral Tribunal before the learned arbitrator, the same is deemed to have been waived in view of the provisions contained in Section 4 read with Section 16 of the Arbitration Act, 1996. Section 16 of the Arbitration Act, 1996 provides that the Arbitral Tribunal may rule on its own jurisdiction. Section 16 clearly recognizes the principle of kompetenz-kompetenz. Section 16(2) mandates that a plea that the Arbitral Tribunal does not have jurisdiction shall be raised not later than the submission of the statement of defence. Section 4 provides that a party who knows that any requirement under the arbitration agreement h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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