M/S Rpp Infra Projects Limited Vs Union of India and Ors.

This is an application for extension of the mandate of the learned Arbitral Tribunal. The petitioner is the claimant before the learned Tribunal. Both parties suggested their nominee Arbitrator, and the third Arbitrator appointed by this Court.

¶13

The application for extension of mandate was filed in sometime February 22, 2024 i.e. after the expiry of the period. The matter went out of list by direction of Court on the ground that a Special Leave Petition was pending on the question of the maintainability of an application for extension of the mandate, after expiry of the stipulated period.

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The Hon’ble Apex Court decided that an application for extension of mandate of the learned Arbitral Tribunal could be made even after the mandate had expired.

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In the present case, the mandate expired on January 23, 2024. This application is maintainable, in view of the decision of the Hon’ble Apex Court.

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Mr. Rakesh Kumar, learned advocate for the respondents had taken several adjournments, to seek instructions.

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Adjournments were allowed. Mr. Kumar has filed a report with the gist of the orders passed in the arbitral proceeding.

¶19

Mr. Kumar submits that the claimant had prayed for unnecessary adjournments on various occasions and as such, the claimant should be penalized. The prayer for extension of the mandate should be refused as the claimant was not interested to pursue the proceeding with due diligence.

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Mr. P.Biswas, learned advocate for the petitioner, on the other hand submits that, the allegations against the claimant were not correct. Unnecessary adjournments had not been prayed for. Rather, over a period of time, three different counsel appeared for the respondents at various stages of arbitral proceeding and such changes resulted in the delay in disposal of the proceeding.

¶21

Having considered the gist of the orders submitted by Mr. Kumar, this court does not find that the claimant had acted either in a reckless or careless manner, which caused the delay in disposal of arbitral proceeding within the statutory period.

¶22

The Hon’ble Apex Court in SLP (C) NO.2320 of 2023 (Rohan Builders (India) Private Limited vs. Berger Paints India Limited ) 2024 INSC 686, was of the opinion that, a narrow interpretation of the provision for extension of the mandate would be counter protective. However, power to extend should be exercised upon consideration by the court that, there was sufficient cause for such extension. Judicial discretion of the court should not promote abuse of the process by any party. The Court should be cautious and may also put the parties to

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terms. It was observed that the law provided that the Court could also impose exemplary costs upon a negligent party.

¶25

I find that the petitioner had challenged the order of termination of the contract before the writ court. The writ petition was allowed, by setting aside the termination.

¶26

In an appeal preferred by the respondents, the order of the learned Single Judge was set aside and the parties were directed to take appropriate steps. The objections of the respondents were that, in view of the existence of the arbitral clause in the General Terms and Conditions of the contract, the writ petition was not maintainable.

¶27

Thus, the fact that the learned Arbitral Tribunal is the chosen forum of the parties is not in dispute and the respondents had asserted the existence of the arbitration clause in the writ proceedings.

¶28

The appellate court felt that the proper remedy was by way of arbitration and not by a writ petition. Thus, the respondents who had espoused the factum of the existing arbitration agreement, cannot turn around and raise unsustainable objections with regard to the prayer for extension of the mandate.

¶29

Consequent upon dismissal of the writ petition in the appeal, the petitioner approached the respondents for appointment of the arbitral tribunal. The respondents did not raise any objection, but requested the petitioner to apply in the prescribed format.

¶30

In spite of filing of the proforma in Form-25, the respondent did not make any appointment. It appears that

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when the appeal from the order passed in the writ petition was allowed, cost was imposed on the petitioner. The respondents raised an objection that, unless the cost as directed by the appellate court was deposited by the petitioner, the issue of appointment of the arbitral tribunal would not be proceeded with.

¶33

The petitioner approached the court by filing an application under section 11(6) of the Arbitration and Conciliation Act, 1966.

¶34

Thereafter, by consent of the parties, a panel of three arbitrator was constituted to adjudicate the disputes between them consisting of the nominee of each of the parties. The petitioner suggested the name of a learned advocate and the respondent suggested the name of another advocate and the parties agreed not to challenge the composition of the arbitral tribunal. A former Chief Justice of the Calcutta High Court was nominated as the third and presiding arbitrator, by the Court. The relevant portion of the order is quoted below:

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“Under such circumstances, by consent of the parties, a panel of Three Arbitrators is constituted to adjudicate the disputes between the parties which shall consist of nominee of each of the parties. The petitioner has suggested the name of Mr. Arjun Basu, Advocate as its nominee. Similarly the respondent has suggested the name of Mrs. Anjili Nag, Advocate as its nominee. The parties have agreed that they shall not challenge the composition of the Arbitral Tribunal.

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Accordingly, Mr. Arjun Basu, Advocate and Mrs. Anjili Nag, Advocate are appointed as arbitrators. Mr. Justice Jyotirmay Bhattacharya, the former Chief Justice of High Court at Calcutta shall be the Third Arbitrator. The commensurate remuneration shall be fixed by the Arbitrators at the first sitting of the arbitration. The petitioner and the respondents shall bear the remuneration of their respective nominees. However, the remuneration of the Third Arbitrator shall be borne by the parties in equal measures.”

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Under such circumstances and in this background, it does not suit the respondents to continue to try to put a spanner in the wheel, and obstruct the arbitral proceeding which is at an advanced stage.

¶39

The gist of the orders submitted by the respondents indicate that witness action of the respondent’s witness is going on. This means that, sufficient progress has been made in the proceeding by the tribunal. The proceedings have matured and are near completion. The respondents are acting irresponsibly, in trying to hinder the dispute redressal mechanism which they had chosen and sought to rely upon.

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Under such circumstances, it will be unfair and unjust not to extend the mandate of the learned tribunal.

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The application is disposed of upon allowing the prayer of extension.

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The learned arbitral tribunal shall complete the entire proceeding and publish the award within one year from the date of communication of this order.

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Parties to act on the server copy of this order downloaded from the official website of this Court.

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( Shampa Sarkar, J. )

M/S Rpp Infra Projects Limited v. Union of India and Ors.

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M/S Rpp Infra Projects Limited v. Union of India and Ors.

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