Dismissed¶23

M/S. S.M. Consultants v. State of Odisha

Arbitration – Appointment of arbitrator

Orissa HC18 Dec 2024ARBP/20/2024

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Case brief

AI extract

What is this about?

ARBP No. 20 of 2024, High Court of Orissa (Chakradhari Sharan Singh, CJ), 18.12.2024 — Section 11(6) Arbitration & Conciliation Act 1996 application for arbitrator appointment dismissed because petitioner bypassed the agreed Clause 8.2.1(b) mechanism (party-nominated arbitrators; third by Secretary, Indian Council of Arbitration) and had not appointed its own arbitrator; non-technical dispute conceded; liberty preserved to invoke the contractual route. Keywords: arbitration agreement procedure, Section 11(6) refusal, non-compliance with appointment clause.

What did the court decide?

Liberty reserved to the petitioner to take steps for appointment of arbitrator/panel of arbitrators in accordance with the arbitration agreement (Clause 8.2.1(b), Special Conditions of Contract). ¶23

M/S. S.M. Consultants Vs State of Odisha — Orissa HC (2024) — LawSathi Research

What the court decided

AI extract

Outcome

Liberty reserved to the petitioner to take steps for appointment of arbitrator/panel of arbitrators in accordance with the arbitration agreement (Clause 8.2.1(b), Special Conditions of Contract).

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Issue for consideration

Whether the dispute concerns a technical matter and whether the petitioner complied with the arbitrator-appointment procedure prescribed in Clause 8.2.1(b) of the Special Conditions of Contract. +1 more

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Court's answer

Counsel for the petitioner did not dispute that the dispute is non-technical, and it is evident from the averments in the application that the petitioner did not appoint its arbitrator as required under Clause 8.2.1(b) of the agreement.

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Ratio / Principle

Since the petitioner failed to follow the procedure prescribed for appointment of arbitrators in terms of the arbitration agreement, the Court is not required to exercise its jurisdiction under Section 11 of the Act.

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Key takeaways

The application under Section 11(6) is dismissed.ratio¶22
The petitioner remains at liberty to take steps for appointment of an arbitrator/panel of arbitrators in accordance with the arbitration agreement.ratio¶23

Detailed headnote1 paragraphs

Arbitration — Appointment of arbitrator — S. 11(6), Arbitration & Conciliation Act, 1996 — Petitioner (consultancy firm) sought Court-appointed arbitrator vis-a-vis State of Odisha, Works Department — Arbitration agreement (Clause 8.2.1(b), Special Conditions of Contract) required each party to appoint one arbitrator, the two jointly naming a third/chairman, failing which the Secretary, Indian Council of Arbitration, New Delhi to appoint on request — Petitioner conceded the dispute was non-technical and had admittedly not appointed its own arbitrator — Held, where a party fails to follow the appointment procedure prescribed in the arbitration agreement, the Court is not required to exercise jurisdiction under S. 11 — Application dismissed — Liberty left open to take steps for constitution of the arbitral panel in accordance with the agreement.

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IN THE HIGH COURT OF ORISSA AT CUTTACK

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ARBP No. 20 of 2024

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M/s. S.M. Consultant, represented …. Petitioner through its Proprietor Dr. Soumendra Kumar Mohanty

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Mr. D.D. Panigrahi, Advocate

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-versus-

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…. State of Odisha, Works Department, Opposite Party represented by the Chief Engineer, World Bank Project

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Ms. A. Dash, Additional Standing Counsel

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CORAM:

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HON’BLE THE CHIEF JUSTICE

ORDER

Order No.

18.12.2024

This matter is taken up through Hybrid mode.

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This application has been filed by the petitioner under Section 11(6) of the Arbitration & Conciliation Act, 1996 (in short ‘the Act’) for appointment of an arbitrator.

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Ms. A. Dash, learned Additional Standing Counsel (ASC), appearing on behalf of the opposite party-State has drawn this Court’s attention to the procedure prescribed for appointment of the arbitration Tribunal under the arbitration agreement in Clause8.2.1(b) of the Special Conditions of Contract, which reads thus:

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“ 8.2.1(b)- Where the Parties do not agree that the dispute concerns a technical matter, the Client and the Consultants shall each appoint one arbitrator, and these two arbitrators shall jointly appoint a third

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arbitrator, who shall chair the arbitration panel. If the arbitrators named by the Parties do not succeed in appointing a third arbitrator within thirty (30) days after the latter of the two arbitrators named by the Parties has been appointed, the third arbitrator shall, at the request of either Party, be appointed by Secretary, the Indian Council of Arbitration, New Delhi.”

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Mr. D.D. Panigrahi, learned counsel appearing on behalf of the petitioner does not dispute that the dispute between the parties does not concern a technical matter. It is also evident from the averments made in the application seeking appointment of an arbitrator that the petitioner has not appointed its arbitrator which is required under Clause- 8.2.1(b) of the agreement.

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As the petitioner has failed to follow the procedure prescribed for appointment of arbitrators in terms of the arbitration agreement, this Court is not required to exercise its jurisdiction under the provisions of Section 11 of the Act.

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In such view of the matter, this application is dismissed.

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It goes without saying that the petitioner shall be at liberty to take steps for appointment of arbitrator/panel of arbitrators in accordance with the aforesaid arbitration agreement.

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(Chakradhari Sharan Singh) Chief Justice

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S. Behera

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Signature Not Verified

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Digitally Signed Signed by: SUMANTA BEHERA Designation: Senior Stenographer Reason: Authentication Location: High Court of Orissa, Cuttack Date: 20-Dec-2024 12:22:54

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M/S. S.M. Consultants v. State of Odisha

Case brief

What is this about?

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M/S. S.M. Consultants v. State of Odisha

Case brief

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