Arbitration proceedings -Court can appoint any arbitrator other than the prescribed arbitrator as per the terms of agreement – disputes between contractors and Railways – as per the terms of agreement a railway Officer was to be appointed as arbitrator – decades lapsed no award was passed – High court appointed former Chief Justice of the Sikkim High Court – challenged as invalid and beyond conditions of arbitration agreement – Apex court held thatA period of nearly two decades has elapsed since the contractor had raised his claims for alleged wrongful termination of the two contracts. The situation is distressing and to say the least disturbing. The power of the Court under the Act has to be exercised to effectuate the remedy provided thereunder and to facilitate the mechanism contemplated therein. In a situation where the procedure and process under the Act has been rendered futile, the power of the Court to depart from the agreed terms of appointment of arbitrators must be acknowledged in the light of the several decisions noticed by us. We are, therefore, of the view that no infirmity muchless any illegality or failure of justice can be said to be occasioned by the order passed by the High Court so as to warrant any interference. We, therefore, unhesitatingly dismiss this appeal filed by the appellant-railways. = CIVIL APPEAL NO.6275 OF 2014 (Arising out of SLP (C) No. 20427 OF 2013) NORTH EASTERN RAILWAY & ORS. … APPELLANT (S) VERSUS TRIPPLE ENGINEERING WORKS … RESPONDENT (S) = 2014- Aug. Part – http://judis.nic.in/supremecourt/filename=41824

    Arbitration proceedings -Court can appoint any arbitrator other than the prescribed arbitrator as per the terms of agreement –   disputes between contractors and Railways – as per the terms of agreement a railway Officer was to be appointed as arbitrator – decades lapsed no award was passed – High court appointed  former Chief Justice of the  Sikkim  High  Court – challenged as invalid and beyond conditions of arbitration agreement – Apex court held that A period of nearly two decades has elapsed since the contractor had  raised his claims for alleged wrongful  termination  of  the  two  contracts.  The situation is distressing and to say the least  disturbing.  

The  power  of the Court under the Act  has  to  be  exercised  to  effectuate  the  remedy

provided thereunder and to facilitate the  mechanism  contemplated  therein. In a situation where the procedure  and  process  under  the  Act  has  been rendered futile, the power of the Court to depart from the agreed  terms  of appointment of arbitrators must be acknowledged in the light of the  several decisions noticed by  us.    We  are,  therefore,  of  the  view  that  no infirmity muchless any illegality or failure of justice can be  said  to  be occasioned by the order passed by the  High  Court  so  as  to  warrant  any interference. We, therefore, unhesitatingly dismiss this  appeal  filed  by the appellant-railways.  =

Admittedly, the General Conditions of Contract  of the Railways, which included an arbitration clause,  governed  the  parties.

After  the  termination  of  the  two  contracts  the  respondent-contractor approached the Patna High Court by means of a writ petition challenging  the terminations. =

Though a panel of arbitrators as per Clauses  64(3)(a)(ii)  and  (iii)

of the General Conditions of Contract was appointed as far back  as  in  the

year 1996, till date the award(s) in respect of the disputes arising out  of

either of the  two  contracts  is  yet  to  be  passed.  =

 In the present case Clauses 64(3)(a)(ii)  and  (iii)  of  the  General

Conditions of Contract do not prescribe any specific  qualification  of  the

arbitrators that are to be appointed under the agreement  except  that  they

should be railway officers.

As already noticed,  even  if  the  arbitration

agreement was to specifically provide for  any  particular  qualification(s)

of an arbitrator the same would not denude the power  of  the  Court  acting

under Section 11(6), in an appropriate case to depart therefrom.

In  Singh

Builders Syndicate (supra) pendency of arbitration proceedings  for  over  a

decade was found by this Court to be a  mockery  of  the  process.=

In  the

present case, admittedly the award in respect of  disputes  and  differences

arising out of the contract No. CAO/CON/722 is yet  to  be  passed.

Though

the appellant-Railway has in its pleadings made a feeble attempt to  contend

that the process of arbitration arising out of the said  Contract  has  been

finalized, no material, whatsoever,  has  been  laid  before  the  Court  in

support thereof.

The arbitration proceedings to resolve  the  disputes  and

differences arising out of Contract No. CAO/CON/738 has not even  commenced.

A period of nearly two decades has elapsed since the contractor had  raised

his claims for alleged wrongful  termination  of  the  two  contracts.

The

situation is distressing and to say the least  disturbing.

The  power  of

the Court under the Act  has  to  be  exercised  to  effectuate  the  remedy

provided thereunder and to facilitate the  mechanism  contemplated  therein.

In a situation where the procedure  and  process  under  the  Act  has  been

rendered futile, the power of the Court to depart from the agreed  terms  of

appointment of arbitrators must be acknowledged in the light of the  several

decisions noticed by  us.

We  are,  therefore,  of  the  view  that  no

infirmity muchless any illegality or failure of justice can be  said  to  be

occasioned by the order passed by the  High  Court  so  as  to  warrant  any

interference.

We, therefore, unhesitatingly dismiss this  appeal  filed  by

the appellant-railways.

However, in the facts of the case we  do  not  deem

it appropriate to burden the appellant with any costs.

 2014- Aug. Part – http://judis.nic.in/supremecourt/filename=41824

RANJAN GOGOI, M.Y. EQBAL