Disposed

M/S Arunoday Construction Company Private Limited v. the Union of India and Anr.

Gauhati HC1 Aug 2022Arb.P./2/2022

Case brief

AI extract

What is this about?

The Gauhati High Court appointed a retired judge as a sole arbitrator to decide a dispute afresh after an earlier award was set aside. The court held that since parties could not agree, a fresh arbitrator must be appointed under Section 11.

What did the court decide?

The Court appointed Hon'ble Mr. Justice D. Biswas as the Sole Arbitrator to decide the dispute afresh.

M/S Arunoday Construction Company Private Limited Vs… — Company and Corporate | Gauhati HC (2022)

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Page No.# 1/5

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GAHC010229082021

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THE GAUHATI HIGH COURT (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)

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Case No. : Arb.P./2/2022

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M/S ARUNODAY CONSTRUCTION COMPANY PRIVATE LIMITED A COMPANY REGISTERED UNDER THE COMPANIES ACT, 1956 AND HAVING ITS REGISTERED OFFICE AT PALLAVI HOUSE (NEAR ABC), G.S. ROAD, GUWAHATI-781005 AND REPRESENTED HEREIN BY ITS DIRECTOR SRI AVDESH LAHOTY

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VERSUS

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THE UNION OF INDIA AND ANR REPRESENTED HEREIN BY THE GENERAL MANAGER (WORKS), N.F. RAILWAY, MALIGAON, GUWAHATI-11, KAMRUP(M), ASSAM

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2:THE GENERAL MANAGER (WORKS) N.F. RAILWAY MALIGAON GUWAHATI-11 KAMRUP(M) ASSA

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Advocate for the Petitioner : MR G RAHUL

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Advocate for the Respondent : SC, RAILWAY

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Page No.# 2/5

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BEFORE HON'BLE MR. JUSTICE N. KOTISWAR SINGH

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ORDER

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01.08.2022

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Heard Mr. G. Rahul, learned counsel for the petitioner. Also heard Mr. B. Sarma, learned standing counsel, N.F. Railway, appearing for the respondents.

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2. In view of the very limited issue involved in this petition, it may not be necessary to go into the detail of the background facts. Suffice to mention that the present petition is for appointment of a fresh arbitrator after the award made by the earlier arbitrator was set aside and interfered by this Court with liberty given to the parties to initiate a fresh process for referring the dispute for settlement by means of arbitration in accordance with the provisions of the Arbitration and Conciliation Act, 1996.

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3. Though the present petition has been filed seeking appointment of an arbitrator to resolve the dispute amongst the parties, it is not a case of fresh appointment in as much as the dispute between the parties had already been referred to an arbitrator appointed by this Court under Section 11 of the Arbitration and Conciliation Act, 1996. However, the award made by the learned Arbitrator dated 06.10.2005 was challenged by the petitioner before the learned District Judge, Kamrup, under Section 34 of the Arbitration and Conciliation Act, 1996. The learned District Judge, Kamrup vide judgment and order dated 29.01.2008 set aside the award dated 06.10.2005 passed by the Sole Arbitrator under Section 34 of the Act. The said order of the learned District Judge dated 29.01.2008 by setting aside the arbitral award was put to challenge by the Railways before this Court by filing an appeal under Section 37 of the Arbitration and Conciliation Act, 1996, which was registered and numbered as Arb.A. No.7/2009 and was disposed of by this Court vide order dated 13.12.2018 with the

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Page No.# 3/5

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following directions:-

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“14. For the reasons stated above, the impugned order awarding the claim of the respondent is held to be illegal and therefore, stands set aside.

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Parties would be at liberty to initiate fresh process for referring the dispute for settlement by means of Arbitration in accordance with the provision of the Act of 1996.”

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4. Since the order awarding claim of the respondents was held illegal and set aside, which necessitated fresh resolution of the dispute, this Court passed the order giving liberty to the parties to initiate fresh process for referring the dispute for settlement by means of arbitration.

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5. Learned counsel for the petitioner submits that pursuant to the aforesaid direction of this Court on 14.02.2019 passed in Arb.A. No.7/2009, the petitioner issued a notice to the Railway authorities on 09.09.2019 seeking payment of the balance amount with interest within 15 days from the date of receipt of the notice, failing which the petitioner will be compelled to approach the Court for referring the matter to the arbitrator. However, as there was no response from the Railway authorities, the petitioner wrote to the Railway authorities vide letter dated 17.12.2019 proposing the name of one Shri Prabhat Chandra Borpujari, Retired District & Sessions Judge, to act as the Sole Arbitrator. However, the Railway authorities rejected the said proposal by stating that the matter required to be remanded to the earlier Sole Arbitrator. Thus, from the above what transpires is that though the matter was required to be referred to the fresh arbitrator and the petitioner proposed the name of another arbitrator other than the one who had passed the award which was interfered with by the Court, as mentioned above, the Railways insisted that it should be referred to the same arbitrator. To this learned counsel for the petitioner submits on the basis of the decision of the Hon'ble Supreme Court in Dr. A. Parthasarathy & Ors. Vs. E Springs Avenues

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Pvt. Ltd. & Ors. [ 2022 SCC OnLine SC 719 ] that once an award has been set aside by the High Court in exercise of the power under Section 37 of the Arbitration and Conciliation Act, 1996, two options are available with the High Court - the High Court may either relegate the parties for fresh arbitration or to consider the appeal on merit on the basis of materials available on record within the scope and ambit of the jurisdiction under Section 37 of the Act. However, the High Court has no jurisdiction to remand the matter to the same arbitrator unless it is consented by both the parties that the matter be remanded to the same arbitrator.

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6. In the present case, this Court while considering the appeal under Section 37, did not consider the matter on merit but gave liberty to the parties to refer the matter to an arbitrator afresh. Mr. B. Sarma, learned standing counsel for the Railways submits that the matter may be referred to the same arbitrator. At the same time, learned counsel for the petitioner submits that the petitioner firm is not agreeable to refer the matter to the same arbitrator. Learned counsel for the petitioner submits that in view of the decision of the Hon'ble Supreme Court, perhaps that may not be permissible. Under the circumstances, the only option available before this Court is to go for appointment of another arbitrator in the light of the decision of the Hon'ble Supreme Court in Dr. A. Parthasarathy (supra).

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7. Since there is a failure on the part of the parties to agree on the sole arbitrator to settle the dispute which is required to be settled in view of the direction of this Court in Arb.A. No.7/2009 vide order dated 14.02.2019, this Court proposes to appoint Hon'ble Mr. Justice D. Biswas, retired Judge of this High Court to act as the Sole Arbitrator to decide the dispute afresh, however, subject to the requirement as provided under Section 12 of the Arbitration and Conciliation Act, 1996.

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8. Parties will accordingly, appear before the proposed arbitrator on 03.09.2022 and the

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learned Arbitrator will proceed with the matter in accordance with law.

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9. Petition stands disposed of with the above observation and direction.

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10. Parties may also intimate the proposed arbitrator, in writing, about the order passed today in this petition, by furnishing a copy of this order.

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Sd/- N. Kotiswar Singh JUDGE

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Comparing Assistant

M/S Arunoday Construction Company Private Limited v. the Union of India and Anr.

Case brief

What is this about?

What did the court decide?

M/S Arunoday Construction Company Private Limited v. the Union of India and Anr.

Case brief

What is this about?

What did the court decide?

What the court decided

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