{"id":68269,"date":"2009-04-16T00:00:00","date_gmt":"2009-04-15T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/mahindra-lifespace-developers-vs-the-new-great-eastern-spinning-on-16-april-2009"},"modified":"2016-02-04T03:59:25","modified_gmt":"2016-02-03T22:29:25","slug":"mahindra-lifespace-developers-vs-the-new-great-eastern-spinning-on-16-april-2009","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/mahindra-lifespace-developers-vs-the-new-great-eastern-spinning-on-16-april-2009","title":{"rendered":"Mahindra Lifespace Developers … vs The New Great Eastern Spinning & on 16 April, 2009"},"content":{"rendered":"
Bombay High Court<\/div>\n
Mahindra Lifespace Developers … vs The New Great Eastern Spinning & on 16 April, 2009<\/div>\n
                                             1\n\n             IN THE HIGH COURT OF JUDICATURE AT BOMBAY\n                 ORDINARY ORIGINAL CIVIL JURISDICTION \n                ARBITRATION APPLICATION NO. 110 OF 2008\n\n\n\n\n                                                                                     \n    Mahindra Lifespace Developers Ltd.,             )\n\n\n\n\n                                                             \n    a company incorporated under the                )\n    Companies Act, 1956, and having their           )\n    office at 5th Floor, Mahindra Towers,           )\n    Worli, Mumbai - 400 018.                        )..            Applicant \n\n\n\n\n                                                            \n                 Vs.\n\n    1.    The New Great Eastern Spinning & )\n\n\n\n\n                                                \n          Weaving Company Ltd., a Company)\n          incorporated under the provisions  )\n                                 \n          of the Companies Act, 1913 and  )\n          is an existing company under the  )\n          Companies Act, 1956 having its  )\n                                \n          registered office at 25-29,        )\n          Dr. Ambedkar Road,                 )\n          Mumbai - 400 027.                  )\n           \n\n\n    2.     Rozal Mehta, an Indian Inhabitant, )\n        \n\n\n\n           residing at Carmichael House,          )\n           Carmichael Road,                       )\n           Mumbai - 400 026.                      )..           Respondents\n                  --\n\n\n\n\n\n    Shri Virag Tulzapurkar, Senior Advocate i\/by M\/s. Little & Company\n    for the Applicant. \n    Shri   D.D.   Madon,   Senior   Advocate   i\/by   M\/s.   Kanga   &   Co.   for   the\n    Respondents. \n\n\n\n\n\n                  --\n\n                               CORAM :  SWATANTER KUMAR, C.J.\n\n    JUDGMENT RESERVED ON                            : 20TH MARCH, 2009.\n\n\n\n\n                                                             ::: Downloaded on - 09\/06\/2013 14:31:33 :::\n                                                 2\n\n    JUDGMENT PRONOUNCED ON  : 16TH APRIL, 2009.\n\n    JUDGMENT : \n<\/pre>\n
                  Simple   but   pertinent   questions   of   law   arise   for<\/p>\n
    consideration in this Petition under Section 11 of the Arbitration and<\/p>\n
    Conciliation   Act,   1996   (   hereinafter   referred   to   as   the   “Act”  ).     On<\/p>\n
    behalf   of   the   Applicant,   it   is   contended   that   the   parties   had   not<\/p>\n
    appointed any Arbitrator and Shri Rozal Mehta, Respondent No.2 who<\/p>\n
    had acted as a Conciliator and resultantly acquired disqualification for<\/p>\n
    being nominated as an Arbitrator.  Thus Respondent No.2 cannot be<\/p>\n
    appointed as an Arbitrator in terms of Section 11(8)(b) of the Act.  The<\/p>\n
    Applicant,   thus,   prays   for   an   appointment   of   an   independent<\/p>\n
    Arbitrator.\n<\/p>\n
    2.            On the other hand, the Respondent No.1 objects to the<\/p>\n
    very   maintainability   of   the   present   Petition,   as   it   contends   that<\/p>\n
    Respondent No.2  was appointed and had acted as an Arbitrator thus<\/p>\n
    the   mandate   of   an   Arbitrator   could   be   revoked   or   substituted   only<\/p>\n
    upon a petition being filed satisfying the grounds and reasons stated<\/p>\n
                                                                  ::: Downloaded on – 09\/06\/2013 14:31:33 :::<\/span>
\n                                            3<\/span><\/p>\n
    in Section 12(15) of the Act and such a Petition under Section 11 of<\/p>\n
    the Act is not maintainable and is misconceived.    In order to examine<\/p>\n
    the merits or otherwise of these contentions, reference to the basic<\/p>\n
    facts   of   the   case   is   necessary.     Mahindra   and   Mahindra   Limited<\/p>\n
    entered into an agreement with Respondent No.1 for developing an<\/p>\n
    immovable property situated at 25-29, Dr. Ambedkar Road, Mumbai.\n<\/p>\n
    Mahindra and Mahindra Limited, by virtue of a scheme presented in<\/p>\n
    the   Court   was   amalgamated     with   the   Company   known   as   Gesco<\/p>\n
    Corporation Ltd. and by an order dated 24th October, 2001 the merger<\/p>\n
    was allowed.  Gesco Corporation Limited came into existence.  On or<\/p>\n
    about   24th  December,   2002,   Gesco   Corporation   Ltd.     changed   its<\/p>\n
    name to   Mahindra  Gesco  Developers   Ltd.   Again   on  25th  October,<\/p>\n
    2007,   Mahindra   Gesco   Corporation   Ltd.   changed   its   name   into<\/p>\n
    Mahindra   Lifespace   Developers   Ltd.,   the   Applicant   in   the   present<\/p>\n
    case.     The Applicant and Respondent No.1 executed a Composite<\/p>\n
    Service Agreement on 14th July, 1995. This agreement read with the<\/p>\n
    original Memorandum of Understanding provided for detail terms and<\/p>\n
    conditions for execution of the development of the property.       The<\/p>\n
    Applicant took several steps to develop the property.     According to<\/p>\n
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\n                                              4<\/span><\/p>\n
    the   Applicant,   because   of   non   cooperative   attitude   adopted   by   the<\/p>\n
    Respondent   No.1   and   despite   at   the   Applicant   rendering   financial<\/p>\n
    assistance the contract could not be concluded as desired.\n<\/p>\n
    3.           According to the Applicant, it was willing to perform all its<\/p>\n
    obligations under the terms and conditions of the agreement and even<\/p>\n
    had advanced monies in excess of Rs.35 crores to Respondent No.1<\/p>\n
    besides putting in a lot of time and labour.     In the long past years,<\/p>\n
    the   parties   had   been   meeting,   negotiations   had   taken   place   but<\/p>\n
    nothing could be successfully concluded.   Respondent No.2 was the<\/p>\n
    named   arbitrator   under   the  terms   of   the   Agreement.     He   had   also<\/p>\n
    participated   in   various  meetings   between   the  parties  which   did   not<\/p>\n
    result   in   any   decision.       Clause   19   of   the   Composite   Service<\/p>\n
    Agreement provided for reference to the sole Arbitrator to adjudicate<\/p>\n
    the  disputes  and  differences  which  may arise  between  the  parties.\n<\/p>\n
    The clause reads as under:-\n<\/p>\n
                  “19. All disputes and differences between the
\n                  parties   hereto   including   interpretation   of   any
\n                  clause herein contained arising out of or under
\n                  this   Agreement   shall   be   referred   to   the   sole
\n                  arbitration of Mr Rozal Mehta, or in the event of<\/p>\n
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\n                                               5<\/span><\/p>\n
                  his   non-availability   Mr…………………   whose
\n                  decision   shall   be   final   and   binding   on   the
\n                  parties   hereto.       The   arbitration   proceedings
\n                  shall   be   held   in   Bombay   and   shall   be   in<\/p>\n
                  accordance with and subject to the provisions
\n                  of   the   Indian   Arbitration   Act,   1940   or   any<\/p>\n
                  statutory   modification   or   re-enactment   thereof
\n                  for the time being in force.”\n<\/p><\/blockquote>\n
    3.            Respondent No.2 vide his letter dated 7th  January, 1996<\/p>\n
    had made certain suggestions and had also referred to offers made<\/p>\n
    by  Kanoria  i.e.   Representative   of   Respondent   No.1.         He   even<\/p>\n
    commented upon the extent of profit that the parties could make by<\/p>\n
    the executing of the project.       The Respondent No.1 vide its letter<\/p>\n
    dated   21st  June,   1996   addressed   to   the   Executive   Director   of   the<\/p>\n
    Applicant   while   refuting   the   allegations   made   in   the   letter   of   the<\/p>\n
    Applicant dated 7th  January, 1996 also referred with some emphasis<\/p>\n
    on the participation of Respondent No.2.  The relevant portion of the<\/p>\n
    said letter reads as under:-\n<\/p>\n
                  “…..Your letter further mentions the submission
\n                  of   certain   papers   by   NGE   but   unfortunately
\n                  does not go on to elaborate the reasons behind<\/p>\n
                  the   same   remaining   pending   which   you   are
\n                  aware of and so is Mr. Rozal Mehta.   In case
\n                  there   remains   any   confusion   on   this   score   in
\n                  your mind I suggest you may have a fresh and
\n                  detailed discussion once again with Mr. Rozal<\/p>\n
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\n                                              6<\/span><\/p>\n
                 Mehta who has repeatedly assured me that all
\n                 such   issues   have   been   thoroughly   and
\n                 repeatedly discussed by him with M & M and on
\n                 the   basis   of   which  assured  me   on   several<\/p>\n
                 occasions   that   they   would   be   satisfactorily
\n                 resolved   but   which   unfortunately   continue   to<\/p>\n
                 remain pending.\n<\/p><\/blockquote>\n
                        With   regard   to   you   suggestion   for   a
\n                 meeting we may do so at any time suitable to<\/p>\n
                 you after 3.30 p.m. Tomorrow.  The presence of
\n                 Mr.   Rozal   Mehta   in   the   discussions   would   be
\n                 most   helpful   as   he   is   closely   aware   of   all
\n                 developments.”\n<\/p><\/blockquote>\n
    4.<\/p>\n
                 Vide   letter   dated   4th  December,   1996   the   Respondent<\/p>\n
    No.1   informed the Applicant that Shri Rozal Mehta should speak to<\/p>\n
    both the parties separately and try to  bridge the gap.     A meeting<\/p>\n
    between the parties appears to have been held on 7th October, 2002<\/p>\n
    wherein matters regarding money to be advanced to Applicant were<\/p>\n
    discussed and it was also decided that the arbitration process shall<\/p>\n
    proceed   in   parallel   to   the   development   of   project   and   Shri   Rozal<\/p>\n
    Mehta, Respondent No.2 to be provided legal assistance by either of<\/p>\n
    the parties.      Vide letter dated 5th June, 2003 the Respondent No.1<\/p>\n
    again wrote to the Applicant in furtherance to the meeting held on 7th<\/p>\n
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\n                                               7<\/span><\/p>\n
    October,   2002   indicating   the   need   for   setting   aside   the   arbitration<\/p>\n
    process,   opted   for   mediation   and   called   upon   a   positive   response<\/p>\n
    from the Applicant.\n<\/p>\n
    5.            Again   Shri   Rozal   Mehta,   Respondent   No.2,   had   on   1st<\/p>\n
    April, 2003 written a private and confidential letter and had noticed,  in<\/p>\n
    furtherance to the discussion that took place between Kanti Kanoria,<\/p>\n
    and   Hemant   that   no   formal   arbitration   would   take   place   and   the<\/p>\n
    parties would, in a sealed cover, submit their claims and process of<\/p>\n
    mediation   would   start.         The   terms   of   mediation   were   put   to   the<\/p>\n
    parties.   It was also stated by Respondent No.2 that it was virtually<\/p>\n
    impossible for him to wear two hats i.e.  one of an Arbitrator and the<\/p>\n
    other of a Mediator, and he would prefer the role of Mediator.   Vide<\/p>\n
    letter dated 15th January, 2008 the Applicant wrote to the Respondent<\/p>\n
    No.1 that there were disputes between the parties and they should be<\/p>\n
    referred to an independent arbitrator to be appointed by the parties.\n<\/p>\n
    This  letter was  responded  by Respondent No.1,  by  its  letter  dated<\/p>\n
    23rd  January, 2008, stating that it would agree to have the disputes<\/p>\n
    between the parties referred to arbitration in terms of Clause 19 to<\/p>\n
    Shri   Rozal   J.   Mehta,   Respondent   No.2   herein.           To   this,   the<\/p>\n
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\n                                               8<\/span><\/p>\n
    Applicant   raised   an   objection   and   stated   that   instead   of   providing<\/p>\n
    legal assistance to Shri Rozal Mehta, it will be better to appoint an<\/p>\n
    independent arbitrator.       However, vide letter dated 16th  February,<\/p>\n
    2008, Respondent No.1 reiterated that the arbitration would be only<\/p>\n
    before   Respondent No.2 and it was not willing for his substitution.\n<\/p>\n
    In the light of these facts, the Applicant filed the present petition under<\/p>\n
    Section   11(2)   and   11(6)     read   with   Section   80   of   the   Act   for<\/p>\n
    appointment of a suitable person to act as a Sole Arbitrator and refer<\/p>\n
    the disputes between the parties to such an Arbitrator.\n<\/p>\n
    6.            From the above narrated facts, it is clear that there is no<\/p>\n
    dispute   either   to   the   execution   or   the   existence   of   the   arbitration<\/p>\n
    agreement.   The dispute only relates to the appointment of a Sole<\/p>\n
    Arbitrator  in  the  backdrop of  the contentions raised by  the learned<\/p>\n
    Counsel appearing for the parties.  First of all it needs to be noticed<\/p>\n
    that Clause 19 of the Composite Service Agreement, the arbitration<\/p>\n
    clause contained in the main Agreement between the parties  refers<\/p>\n
    to the appointment of a named Sole Arbitrator but at the same time<\/p>\n
    the   expression   “or   in   the   event   of   his   non-availability   Mr.<\/p>\n
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\n                                             9<\/span><\/p>\n
    ______________ whose  decision  shall be final and binding on the<\/p>\n
    parties thereto”  indicates that the agreement between the parties had<\/p>\n
    contemplated non-availability  of Respondent  No.2 to  act as  a Sole<\/p>\n
    Arbitrator   and   name   of   the   substitute\/alternate   Arbitrator   was   left<\/p>\n
    blank,   thus   leaving   it   open   for   appointment   of   any   other   Sole<\/p>\n
    Arbitrator other than Respondent No.2.   This construction itself may<\/p>\n
    not be absolutely befitting but in the facts and circumstances of the<\/p>\n
    case it is of some significance.  From the documents afore-referred, it<\/p>\n
    is clear that Respondent No.2 had been acting in once capacity or the<\/p>\n
    other in order to bring the parties to a compromise.  He, vide his letter<\/p>\n
    dated  7th  January,   1996,   had   even  projected     the   minimum   profits<\/p>\n
    resulting from the execution of the project.   Respondent No.1 vide its<\/p>\n
    different   letters   including   4th  December,   1996   had   indicated   that<\/p>\n
    Respondent No.2 understood the points of view of the parties, should<\/p>\n
    meet them separately and try to bridge the gap.     Thus,  there  is no<\/p>\n
    document   on   record   which   in   unambiguous  terms  appoints   by<\/p>\n
    consent of the parties Respondent No.2 as Sole Arbitrator.    On the<\/p>\n
    contrary,   as   noticed   by   Respondent   No.2   himself,   he   had   been<\/p>\n
    wearing different hats from time to time.   According to Respondent<\/p>\n
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\n                                                10<\/span><\/p>\n
    No.2, he had indicated that he would prefer to resolve the disputes<\/p>\n
    between   the   parties   as   a   Mediator.     A   Mediator   is   a   term   having<\/p>\n
    distinct with connotation and distinct functions and obligations to that<\/p>\n
    of an Arbitrator.   An Arbitrator is primarily a Tribunal to resolve the<\/p>\n
    dispute by adjudicative process in accordance with law.  In the letter<\/p>\n
    of   1st  April,   2003,   it   was   specifically   recorded   “on   Friday   the   28th<\/p>\n
    March 2003 wherein we had agreed that no formal arbitration would<\/p>\n
    take   place.”          These   words   clearly   indicate   that   the   parties   had<\/p>\n
    decided not to  pursue  the arbitral forum even if it had commenced.\n<\/p>\n
    There are serious contentions raised even to this aspect of the matter<\/p>\n
    as to whether the sole arbitrator had entered upon the reference and<\/p>\n
    had in fact conducted arbitration proceedings at any stage.  Firstly, it<\/p>\n
    is not quite certain, at least the Court is not convinced that Shri Rozal<\/p>\n
    Mehta had been appointed as a sole arbitrator in accordance with law<\/p>\n
    and   he   had   acted   as   the   sole   arbitrator   to   adjudicate   differences<\/p>\n
    and\/or disputes between the parties.  The emphasis of the Applicant<\/p>\n
    is   that   Respondent   No.2   had   acted   as   a   Mediator   and   the<\/p>\n
    correspondence exchanged by him as well as his conduct with the<\/p>\n
    parties is that of a Mediator and not that of an arbitrator.   No attempts<\/p>\n
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\n                                            11<\/span><\/p>\n
    had been made by him to settle the dispute between the parties by<\/p>\n
    adjudication process and that he had clearly worked as a Conciliator<\/p>\n
    or Mediator between the parties, also had tried to bring them together<\/p>\n
    and in fact had even put forth the proposal of one side the parties with<\/p>\n
    greater emphasis to that correspondence.   The Agreement dated 14th<\/p>\n
    July, 1995 was subsisting and was treated as effective and binding<\/p>\n
    between   the   parties   as   late   as   on   27th  November,   2007.     While<\/p>\n
    referring to the letter dated 30th October, 2007 wherein the Applicant<\/p>\n
    informed   Respondent   No.1,     after   noticing   the   four   options   which<\/p>\n
    even included that the decision of the sole arbitrator shall be final and<\/p>\n
    bind.   The Applicant had clearly stated that it,  in view of the conduct<\/p>\n
    of the parties,   reserved its right to chose one of the options at an<\/p>\n
    appropriate time.   In other words, the parties were not  ad idem  that<\/p>\n
    Shri Rozal Mehta, Respondent No.2 had actually acted as the sole<\/p>\n
    arbitrator.     In   various   correspondence   exchanged   between   the<\/p>\n
    parties, which has already  been  referred  by  the  Court,  there is  no<\/p>\n
    unambiguous or definite record to show that Respondent No.2 had<\/p>\n
    been appointed  as the  sole arbitrator  and he had so acted in  that<\/p>\n
    capacity.  Once that is not so, the question of removing the arbitrator<\/p>\n
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\n                                             12<\/span><\/p>\n
    for making an appointment in his place would hardly arise and the<\/p>\n
    contention of the Respondent No.1 that the present Application under<\/p>\n
    Section 11 of the Act is not maintainable is without substance and<\/p>\n
    merit.    The provisions of Sections 12 to 14 would be invocable only<\/p>\n
    when there is a mandate for appointment of an arbitrator which can<\/p>\n
    be revoked in the facts and  circumstances of a case.\n<\/p>\n
    7.            There  is  definite  documentation  on  record  to   show  that<\/p>\n
    Respondent   No.2   acted   as   a   Mediator   or   Conciliator   and   always<\/p>\n
    attempted   to   reconcile   the   dispute   between   the   parties   by   mutual<\/p>\n
    agreement and persuasion.  In fact, as already noticed, he himself in<\/p>\n
    his letter dated 1st April, 2003 had noticed that during the discussions<\/p>\n
    between   the   parties   and   him,   it   was   agreed   that   the   process   of<\/p>\n
    mediation would start on both parties submitting their claims in sealed<\/p>\n
    envolope, and had clearly stated that he could not wear two hats, i.e.<\/p>\n
    one of an Arbitrator and the other of a Mediator.   He had also stated<\/p>\n
    that he had been acting as an Mediator and would step down as an<\/p>\n
    Mediator when ever his role as an Arbitrator would be called for and<\/p>\n
    would look into the matter. The letter dated 21st June, 1996 (Exhibit-\n<\/p>\n
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\n                                             13<\/span><\/p>\n
    C) indicates that Respondent No.2 was present in all the meetings<\/p>\n
    between the parties.  It also refers to discussion of Respondent No.2<\/p>\n
    with one party and consequent assurances being given to the other<\/p>\n
    party.  Vide letter dated 15th January, 2008, the Applicant had clearly<\/p>\n
    stated   that   the   arbitration   agreement   should   be   invoked   and   had<\/p>\n
    requested for an appointment of any independent arbitrator.       The<\/p>\n
    distinction between the arbitration and mediation is well known and<\/p>\n
    accepted   now.       The   arbitration   in   no   uncertain   terms   is   an<\/p>\n
    adjudication   process   which   an   arbitral   tribunal   performs   in<\/p>\n
    accordance with law while mediation is a conflict resolution method<\/p>\n
    where a neutral person facilitates discussions between  the parties in<\/p>\n
    an attempt to get the parties to reach an agreement that is mutually<\/p>\n
    agreeable to both the parties.       In short mediation is a method to<\/p>\n
    dissolve disagreement designed to help disputing parties resolve their<\/p>\n
    own   dispute   even   without   obtaining   legal   counsel.     It   is   a   non-\n<\/p>\n
    adversarial   approach   to   conflict   resolution   and   the   approach   of<\/p>\n
    mediator is to encourage mutual agreement rather than to impose a<\/p>\n
    settlement.     It   is   not   simplicitor   a   remedy   but   a   system   having<\/p>\n
    appropriate of dispute resolution.     One must remember that litigant<\/p>\n
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\n                                                 14<\/span><\/p>\n
    should not feel that by resorting to mediation he is going to get justice<\/p>\n
    of second class.   Legitimacy of action of court in referring matter to<\/p>\n
    mediation   depends   upon   quality   of   mediation   process   which   is<\/p>\n
    offered.  It is,  therefore, important to keep in mind the objectives of<\/p>\n
    mediation.\n<\/p>\n
                   (i)     It   is   to   facilitate   parties   resolving   dispute<\/p>\n
    themselves;\n<\/p>\n
                   (ii)<\/p>\n
                           To provide fair and expeditious ADR process; <\/p><\/blockquote>\n
                   (iii)   To   provide   effective   and   cost   effective   ADR<\/p>\n
    process;\n<\/p>\n
                   (iv)    To provide informal ADR process.\n<\/p>\n
    For   all   kinds   of   mediation,   the   basic   training   of   a   mediator   is   for<\/p>\n
    transforming “No” to “I will think over the solution” and further to “I<\/p>\n
    think  it  is  a  better  solution”.    It  definitely  would  require  specialised<\/p>\n
    communication skills.   Mediator has to apply universal principles of<\/p>\n
    persuation in the process of mediation.  Cialdini has stated six such<\/p>\n
    principles, namely, <\/p>\n
                                                                   ::: Downloaded on – 09\/06\/2013 14:31:33 :::<\/span>
\n                                                   15<\/span><\/p>\n
                    (a)    Reciprocity   :   People   feel   obligated   to   give
\n                           back to others who have given to them.\n<\/p>\n
                    (b)    Linking : We prefer to say “yes” to those we<\/p>\n
                           know and like.\n<\/p>\n
                    ( c) Consensus          :   People   decide   what’s
\n                         appropriate for them to do in a situation by<\/p>\n
                         examining   and   following   what   others   are
\n                         doing.\n<\/p>\n
                    (d)    Authority   :   People   rely   on   those   with<\/p>\n
                           superior   knowledge   or   perspective   for
\n                           guidance   on   how   to   respond   AND   what<\/p>\n
                           decision to make.\n<\/p>\n
                    (e)    Consistency : Once we make a choice\/take<\/p>\n
                           a   stand,   we   will   encounter   personal   and
\n                           interpersonal   pressure   to   behave
\n                           consistently with that commitment.\n<\/p>\n
                    (f)    Scarcity   :   Opportunities   appear   more<\/p>\n
                           valuable when they are less available.”\n<\/p>\n
    8.             The role of Respondent No.2 as reflected from the record<\/p>\n
    on the Court file was primarily that of a mediator and not that of an<\/p>\n
    arbitrator.   There is no much doubt that Respondent No.2 had acted<\/p>\n
    as Mediator or Conciliator between the parties and had put forward a<\/p>\n
    point   of   view   of   one   party   to   the   other.       Thus,   in   view   of   a   fine<\/p>\n
                                                                      ::: Downloaded on – 09\/06\/2013 14:31:33 :::<\/span>
\n                                            16<\/span><\/p>\n
    distinction between the Conciliator and Arbitrator, the action is not a<\/p>\n
    greater   significance   in   the   present   case,   and   as   held   in  Salem<\/p>\n
    Advocate Bar Association, T.N. v. Union of India, (2005)6 SCC 344,<\/p>\n
    that “in conciliation, there is a little more latitude and a conciliator can<\/p>\n
    suggest   some   terms   of   settlements   too.”     Attempts   made   by<\/p>\n
    Respondent No.2  were  actually  for  resolving the  disputes between<\/p>\n
    the parties  by recourse to the process of mediation rather than by<\/p>\n
    adjudication process.   He talked to the parties individually, putforth<\/p>\n
    proposal of one party to the other and tried to bring up a commonly<\/p>\n
    acceptable solution to their problems.  Thus, this is not a function of<\/p>\n
    an arbitrator.   Another way of looking at it is as to what the parties<\/p>\n
    actually understood   and  practiced  as a result of the role played by<\/p>\n
    Respondent   No.2.     As   far   as   the   Applicant   is   concerned,   all<\/p>\n
    throughout,   it   took   up   the   stand   as   to   whether   Respondent   No.2<\/p>\n
    should act as a Conciliator or Mediator and ultimately requested for<\/p>\n
    an independent arbitrator because of the bar contained in Section 80<\/p>\n
    of the Act.     The Respondents No.1 did aver in the correspondence<\/p>\n
    that Respondent No.2  acted as an arbitrator but he himself made it<\/p>\n
    clear that he was acting as Mediator and would give up that role and<\/p>\n
                                                            ::: Downloaded on – 09\/06\/2013 14:31:33 :::<\/span>
\n                                                17<\/span><\/p>\n
    consider the role of an arbitrator as and when occasion arose.     It<\/p>\n
    may not be absolutely essential for this Court to examine in a greater<\/p>\n
    detail   when   there   is   a   bar   contained   in   Section   80   of   the   Act.\n<\/p>\n
    Because it  would always be better  and  in the interest  of justice to<\/p>\n
    appoint an arbitrator in which both the parties have failed and where<\/p>\n
    there  is no genuine apprehension or bias. The Applicant had made<\/p>\n
    certain  averments  in   his   Arbitration  Application  and  resultantly  had<\/p>\n
    asked   for   an   appointment   of   an   independent   arbitrator.       The<\/p>\n
    provisions   of   Section   80   of   the   Act   are   pleaded   as   a   bar   to   the<\/p>\n
    appointment of Respondent No.2 as an arbitrator.    At this stage,  it<\/p>\n
    may   be   appropriate   to   refer   to   the   arbitration   clause   between   the<\/p>\n
    parties.   Clause 19 states that “All disputes and differences between<\/p>\n
    the   parties   hereto   including   interpretation   of   any   clause   herein<\/p>\n
    contained arising out of or under this Agreement shall be referred to<\/p>\n
    the sole arbitration of Mr. Rozal Mehta, or in the event of his non-\n<\/p>\n
    availability Mr………………… whose decision shall be final and binding<\/p>\n
    on   the   parties   thereto.”         In   other   words,   the   parties   had<\/p>\n
    contemplated and the arbitration clause so specifically provides that<\/p>\n
    some   other   sole   arbitrator   could   be   appointed   in   the   event<\/p>\n
                                                                 ::: Downloaded on – 09\/06\/2013 14:31:33 :::<\/span>
\n                                             18<\/span><\/p>\n
    Respondent No.2 could not be available for any reason.  No prejudice<\/p>\n
    will be caused to any of the parties into proceedings and it would be<\/p>\n
    in the interest of justice, equity and good conscious that some other<\/p>\n
    person is appointed as Sole Arbitrator in terms of Clause 19 of the<\/p>\n
    Agreement between the parties rather than Respondent No.2.\n<\/p>\n
    9.            The   parties   infact   can   agitate   their   controverted<\/p>\n
    contentions even before the Arbitrator.  This being an Application for<\/p>\n
    appointment of an Arbitrator, there is limited scope for this Court to<\/p>\n
    play larger role,  as the contentions are left open to be urged before<\/p>\n
    the Learned Arbitrator in terms of Section 16 of the Act.\n<\/p>\n
    10.           Resultantly, Shri S.P. Bharucha, former Chief Justice of<\/p>\n
    India   is   appointed   as   Sole   Arbitrator   to   enter   upon   reference   to<\/p>\n
    adjudicate the disputes between the parties.\n<\/p>\n
    11.           The   Arbitration   Application   is   allowed   and   accordingly<\/p>\n
    stands disposed of.    No order as to costs.\n<\/p>\n
                                                              ::: Downloaded on – 09\/06\/2013 14:31:33 :::<\/span>
\n            19<\/span><\/p>\n
                CHIEF JUSTICE <\/p>\n
                      ::: Downloaded on – 09\/06\/2013 14:31:33 :::<\/span>\n <\/p>\n","protected":false},"excerpt":{"rendered":"
Bombay High Court Mahindra Lifespace Developers … vs The New Great Eastern Spinning & on 16 April, 2009 1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION ARBITRATION APPLICATION NO. 110 OF 2008 Mahindra Lifespace Developers Ltd., ) a company incorporated under the ) Companies Act, 1956, and having their ) […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[11,8],"tags":[],"class_list":["post-68269","post","type-post","status-publish","format-standard","hentry","category-bombay-high-court","category-high-court"],"yoast_head":"\nMahindra Lifespace Developers ... vs The New Great Eastern Spinning & on 16 April, 2009 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/mahindra-lifespace-developers-vs-the-new-great-eastern-spinning-on-16-april-2009\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Mahindra Lifespace Developers ... vs The New Great Eastern Spinning & on 16 April, 2009 - 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