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TMI Blog2017 (7) TMI 1456X X X X Extracts X X X X X X X X Extracts X X X X ..... to furnish a longer list to the petitioner containing at least 30 names. Secondly, the arbitration clause provides that the railways can appoint any person from within or outside that panel. This stipulation is bad. The railways do not disclose the personnel from whom they would appoint their arbitrator. The Contractor does not know whether the appointed arbitrator of the railways would be disqualified under Schedules V and VII. Therefore, it is also imperative that the railways appoint an arbitrator from the panel sent to the petitioner or from a disclosed panel. This application is disposed of by setting aside the letter dated 24th February, 2017 (Annexure-m page 68 of the petition) by directing the respondent railways to forward a panel of at least 30 names, of persons of different backgrounds and professional avocations and attainments to the petitioner. It may include serving or retired officers of other organisations. From this panel the petitioner will be required to choose two. Thereafter, the railways can select one to be the contractor's nominee arbitrator. - I.P. Mukerji, J. For the Appellant : Jishnu Saha, Srinanda Bose, Pankaj Agarwal and J.D. Roy. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ile partiality will more likely surface during the arbitration proceedings. 24. *************** in the context of this case, it is relevant to mention that only if an arbitrator is an employee, a consultant, an advisor or has any past or present business relationship with a party, he is rendered ineligible to act as an arbitrator. Likewise, that person is treated as incompetent to perform the role of arbitrator, who is a manager, director or part of the management or has a single controlling influence in an affiliate of one of the parties if the affiliate is directly involved in the matters in dispute in the arbitration. Likewise, persons who regularly advised the appointing party or affiliate of the appointing party are incapacitated. A comprehensive list is enumerated in Schedule 5 and Schedule 7 and admittedly the persons empanelled by the Respondent are not covered by any of the items in the said list. 25. It cannot be said that simply because the person is retired officer who retired from the government of other statutory corporation or public sector undertaking and had no connection with DMRC (party in dispute), he would be treated as ineligible to act as an arbitrator. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th April, 2011 with the concurrence of the petitioner. The petitioner had furnished with the metro railways a bank guarantee for Rs. 85,36,764 representing 5% of the contract value. The respondent, from time to time during execution of the contract, paid to the petitioner Rs. 8,34,59,446/-. According to the respondent the petitioner was guilty of delay and unsatisfactory work and supply of materials. According to the petitioner the respondent was in breach of the contract by not performing their obligations under it like providing a proper infrastructure, approval of the drawings and diagrams submitted by the petitioner, failing to issue certification etc. 6. The contract was governed by the general condition of contract of the railways including the Arbitration Clause-63. The contractor, after one twenty days but within 180 days of his presenting the final bill on disputed matters could demand in writing that the disputes be referred to arbitration. The demand for arbitration should specify the exact disputes between the parties. In case the claim exceeded Rs. 10 lakhs the arbitral panel under Clause-64(3)(a)(ii) was to comprise of a panel of three gazetted railway officers. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ircumstances the Supreme Court felt that when the petitioner was given a wider choice to choose their nominee from those 31 odd persons, the standards of independence and impartiality expected of arbitrators was not sacrificed. 12. The arbitration clause in the general conditions of contract is not in compatible with the above decision of the Supreme Court in as much as under those conditions, a contractor is required to be given a list of more than three names out of which he is required to choose two and the railways are to select one out of those two as the contractor's nominee. Thereafter the railways are required to nominate their arbitrator. 13. The general conditions of contract provide that the railways are to provide a list of more than three persons. But this condition is not followed as the highest Court desires it to be followed. The railways have forwarded only three names. They ought to prepare and furnish to a contractor a much longer and wider list. They should be given a wide choice amongst persons with different backgrounds and professional attainments. 14. Therefore, the railways are required to furnish a longer list to the petitioner containing at l ..... X X X X Extracts X X X X X X X X Extracts X X X X
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