JUDGMENT
S.B. Sinha, C.J.
1. A notice of an arbitrator appointed by this Court in
exercise of its power conferred upon it under Section 11 of the
Arbitration and Conciliation Act, 1996 (hereinafter referred to as ‘the said Act’) was questioned by the appellant herein by filing a writ
petition, which was dismissed by reason of the impugned judgment
dated 05.03.2000.
2. The appellant herein was employed with respondent No.
2. A dispute arose as regards enforceability of a bond executed by
the appellant for his refusal to serve respondent No. 2 for a period of
7 years which is said to be the condition for being sent to Japan.
3. A noticed dated 21.09.2000 was served upon the
petitioner by the company, i.e., respondent No. 2 directing him to
serve the company for 7 years or pay damages amounting to
Rs.66,72,000/-.
4. According to the petitioner, the said notice did not
conform to the provisions of Section 21 of the said Act.
5. The appellant contended that there did not exist any
arbitration clause for resolution of the dispute as raised by the
respondent and, in any event, the said purported legal notice is de
hors’ the alleged agreement bond. A reply to the said notice was sent
by the appellant vide letter dated 23.10.2000 denying the existence of
any agreement bond and asserting that the respondent No. 2 itself
had driven the appellant out of employment by irritating him so
much that he had to seek prolonged medical advice.
6. The respondent No. 2 appointed one Mr. Ravi Sharma, as
arbitrator, who called upon the appellant herein to appear before him
on 05.01.2001. The appellant questioned his jurisdiction by sending
a letter dated 23/26.12.2000
7. He thereafter filed a suit, which was marked as Civil Suit
No. 2 of 2001 praying therein that the aforementioned Mr. Ravi
Sharma be required to produce warrant of appointment as arbitrator.
In the said suit, a copy of the said purported agreement dated
08.08.1997 containing an arbitration clause in which Mr. Ravi
Sharma was named as an arbitrator, was produced.
8. The contention of the petitioner was that his signature in
the said agreement was obtained without filing in the blanks.
9. He thereafter filed an application before this Court
praying inter alia for the following reliefs including :-
(A) Direct the respondents to produce in this
Hon’ble Court this original of the alleged
‘Agreement’ allegedly dated 08.08.1997, and
(B1) Declare the alleged ‘Agreement’ allegedly
dated 08.08.1997 (copy in annex – A/11), as ab
initio null and void,
(B2) If (B1) is not granted, declare arbitration clause
(para 14) in the alleged ‘Agreement’ allegedly
dated 08.08.1997 as ab initio null and void,
(C) If (B1) or (B2) is not granted, declare
respondent-3 as an usurper in the office of
arbitrator in any dispute between Applicant and
the Company (respondent-1 through
respondent-2),
(D) Appoint an arbitrator (if (B1) or (B2) is not
granted) under Section 11(5) of the Arbitration
& Conciliation Act (46 of 1996),
(E) Declare that arbitral proceeding have not yet
commenced for want of compliance with
provisions of Section 21 of the Act,
(F) Any other relief, with costs, may be granted,
(G) Meanwhile, respondent-3 may be restrained
from functioning as arbitrator in any dispute
between the Applicant and respondents-1, 2
alleged to flow from the alleged ‘Agreement’
(A/11), till final disposal of this Application.”
By an order dated 06.12.2001, the learned Single Judge
of this Court in A.A. No. 17 of 2001 after hearing the parties by an
order dated 05.03.2002 appointed the respondent No. 1 herein as an
arbitrator to adjudicate upon the disputes between the parties. The
said order reads thus :-
“Reply stated to have been filed is not
on record. Copy thereof has also not been
handed over to the counsel for petitioner. In
any event of the matter, with the consent of
the parties, I appoint Mr. SP Saberwal,
retired District Judge of Delhi as arbitrator
to adjudicate upon the disputes between the
parties under Arbitration & Conciliation Act,
1996. Intimation of appointment be sent to
the arbitrator. The arbitrator is directed to
start the proceedings do novo.
Petitioner stands disposed of. dusty.”
10. The appellant did not question the said judgment. The
arbitrator, however, issued a notice to the appellant, which is in the
following terms :-
“NOTICE
WHEREAS vide order dated 6.12.2001 passed
in AA No: 17/2001, by Hon’ble Mr. Justice Vijender
Jain, High Court of Delhi, in the abovenoted case the
undersigned has been appointed as Arbitrator to
adjudicate upon disputes between the parties under the
Arbitration & Conciliation Act, 1996
AND WHEREAS, the undersigned has entered
upon the reference
WHEREAS notice is given to the parties to
appear before the undersigned themselves or through
their Advocate/Representative, on Saturday the 2nd
February, 2002, at 10.00 am in the Office of the State
Consumer Disputes Redressal Commission, Room No
5, A – Block, Vikas Bhawan, First Floor, IP Estate,
New Delhi – 110002
Sd/-
(SP SABERWAL)
ARBITRAtor
D-I/13, Bharati Nagar,
New Delhi – 110003
Tele : (Res) 469-2286, 469-3470
(Off) 337-9146; Mobile: 9810285966″
11. According to the petitioner, respondent No. 1 was not
competent to enter into the said reference having regard to the fact
that no requisite notice under Section 21 of the said Act was served.
12. The learned Single Judge by reason of the impugned
judgment rejected the said contention raised on behalf of the
appellant herein inter alia on the ground that once the arbitrator was
appointed, there was no necessity now to issue any notice under
Section 21 of the said Act.
13. Mr. G.K. Aggarwal, the learned counsel appearing on
behalf of the appellant would submit that there did not exist any
arbitration clause in the agreement bond as the blanks had not been
filled up.
14. The learned counsel would contend that the prayed for
appointment of the arbitrator in his arbitration application being A.A.
No. 17 of 2001 was made by way of an alternative relief and by
reason thereof, the valuable right of the appellant in terms of Section
21 of the said Act cannot be taken away.
15. In support of the aforesaid contention, strong reliance
has been placed on Jupiter Chit Fund Pvt. Ltd. v. Shiv Narain Mehta, .
16. Mr. R.K. Saini, the learned counsel appearing on behalf
of the respondent, on the other hand, would submit that the writ
petition is not maintainable as the appellant herein can raise the
objections taken herein only before the arbitral tribunal.
17. It was contended that having regard to the prayer made
by the appellant in his arbitration application to the effect that an
independent arbitrator be appointed and such a prayer having been
granted, he is now estopped and precluded from contending that the
arbitration proceedings are vitiated by reason of non-service of notice
under Section 21 of the said Act.
18. In this Letters Patent Appeal, this Court is not concerned
with as regards the validity of the first arbitration proceedings, which
were initiated at the instance of respondent No. 2. In any event, the
said arbitration proceedings have been set at naught by this Court at
the instance of the appellant himself and thus, he cannot be
permitted to raise the said questions once over again.
19. Having regard to the fact that the arbitrator was
appointed with the consent of the appellant, he is now estopped and
precluded from raising the said contention.
20. Having regard to the provisions contained in Section 16
of the said Act, we are of the opinion that now all the contentions
must be raised before the arbitrator himself.
21. As noticed hereinabove, the appellant herein had not
questioned and could not question the said order dated 05.03.2002
of the learned Single Judge. He merely challenged the notice issued
by the learned arbitrator. Such a notice cannot be, in our opinion,
the subject matter of a writ petition.
22. In any event, no writ petition can also be filed having
regard to the decisions of the Apex Court in Konkan Railway
Corporation Ltd. & Anr. v. Rani Construction Pvt. Ltd., 2002 (1) SCALE 465 wherein it
has been held that when an arbitrator is appointed in terms of
Section 11 of the said Act, no writ petition would be maintainable. A
notice of the arbitrator, in our opinion, cannot be subject matter of a
writ petition.
23. Furthermore, at this stage, the Court cannot put the
clock back by setting aside the order of appointment of the arbitrator
and directing the parties to take recourse to the provisions of Section
21 of the said Act.
24. Even assuming that the provisions of Section 21 of the
said Act are mandatory, the appellant by his conduct may be held to
have waived the same. We may notice that in relation to composition
of the arbitral tribunal if not challenged the same has been held to
have been waived by the Apex Court recently in Narayan Prasad
Lohia v. Nikunj Kumar Lohia & Ors., 2002 (2) SCALE 232 wherein it was held :-
“20. Respondents 1 and 2 not having raised any
objection to the composition of the arbitral
tribunal, as provided in Section 16, they must be
deemed to have waived their right to object.”
25. The decision of the Apex court in Jupiter Chit Fund’s
case (Supra), was rendered in a case where the Court was concerned
with the provisions of Section 37 of Arbitration Act, 1940. The said
decision has no application in the facts and circumstances of this
case.
26. For the reasons aforementioned, we are of the opinion
that no case has been made out for interference with the impugned
order. This appeal is accordingly dismissed. However, in the facts
and circumstances of the case, there shall be no order as to costs.