Union Of India vs M/S Nar Bahadur Dahal

Biswanath Somadder, CJ

This arbitration petition has been filed by the Union of India praying inter alia for extension of time till 31st December, 2021, to be granted to the learned Arbitrator for making and publishing the arbitral award. In connection with this arbitration petition, an interlocutory application, being IA No.01of 2021, has been taken out by the respondent, namely, M/s Nar Bahadur Dahal, wherein the respondent has inter alia prayed for substitution of the Arbitrator by appointing an Arbitrator, being a retired Judge of the Hon'ble High Court and to give directions to the said Arbitrator to dispose of the arbitration proceedings as expeditiously as possible.

In the facts of the instant case, we notice that the arbitral tribunal was constituted on 28th June, 2018. The period of twelve months from that date expired on 27th June, 2019. The parties, in terms of the relevant provision of the Arbitration and Conciliation Act, 1996, gave their consent for extension of time for making and publishing of the arbitral award by another six months. The reasons for not being able to conclude the hearing of the arbitration proceedings, as stated in paragraphs 7 and 8 of the arbitration petition, read as follows:-

"7. That the Ld. Arbitrator conducted hearings on different dates to adjudicate the disputes between the petitioner and the respondent. However, the proceedings could not be completed despite of the best efforts of the Ld. Arbitrator as well as the parties. Copies of the Sole Arbitrator's order dated 15th October 2018 and 31st May 2019 are filed herewith and Annexure-P5 & P6 respectively.

It is submitted that the Ld. Arbitrator, got transferred to a remote area at 23 BRTF, Daporijo, Upper Subansiri District, Arunanchal Pradesh from where he could not connect with the parties for the hearing in the Arbitration proceeding. In the meantime, due to outbreak of Covid-19 pandemic, nationwide lockdown was announced and due to the technical problem faced by the Ld. Arbitrator, proceedings could not be concluded within the period prescribed as stipulated under section 29A of the Arbitration and Conciliation Act."

This Court is not satisfied with the one of the reasons, as cited hereinabove. It has been stated by the petitioner that the learned Arbitrator got transferred to a remote area in Arunachal Pradesh from where he cannot communicate with the parties for hearing of the arbitration proceedings. Even the date of his transfer to Arunachal Pradesh has not been stated - nor what he was doing between 31st May, 2019 and the date of his transfer - anywhere in the pleadings. If the learned Arbitrator was unable to discharge his duty, he ought to have either recused or withdrawn himself from the arbitral proceedings and his mandate would have automatically been terminated. However, the learned Arbitrator did not do so, for reasons best known to him. The other reason, which is more plausible, is with regard to the outbreak of Covid-19 pandemic and the imposition of a national lockdown. Certainly, this situation which has arisen in the meanwhile can be said to have given rise to sufficient cause for the learned Arbitrator not being able to discharge his duties by concluding the proceedings within the given timeframe.

Purely in the interest of justice, therefore, this Court extends the time for making and publishing the arbitral award by the learned Arbitrator till 31st December, 2021. In the event, the learned Arbitrator is unable to make and publish the arbitral award within 31st December, 2021, his mandate shall stand automatically terminated and in his place and stead, Hon'ble Mr. Justice Pranab Kumar Chattopadhyay, a retired Judge of the High Court at Calcutta, shall be the Arbitrator and shall dispose of the arbitral proceeding as expeditiously as possible, in accordance with law.

The instant arbitration petition, as well as the connected interlocutory application, being I.A. No. 01 of 2021, stands accordingly disposed of.