JUSTICE P.T. ASHA O.P.Nos.446 to 449 of 2019 M/s. JV Engineering Associate Civil Engineering Contractors 17, Kuttakattu Valasu,

[10/13, 11:44] Sekarreporter 1: O.P.No.446 of 2019
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 10.02.2020
CORAM
THE HONOURABLE Ms. JUSTICE P.T. ASHA
O.P.Nos.446 to 449 of 2019
M/s. JV Engineering Associate
Civil Engineering Contractors
17, Kuttakattu Valasu,
Elumathur (PO), Modakkurichi (via)
Erode – 638 104 (Tamil Nadu)
Represented by its Partner,
Mr.S. Jaikumar
…Petitioner in all OP
Vs
General Manager, CORE, Allahabad,
Represented by
Deputy Chief Engineer, Railway Electrification,
Chennai, Egmore.
…Respondent in all OP
PRAYER: Original Petitions are filed under Section 34(2)(b)(iii) of the
Arbitration and Conciliation Act, 1996 to set aside the Awards dated
07.11.2018 passed by Shri V.K. Manoharan, the Sole Arbitrator.
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For Petitioner : M/s. P.J. Rishikesh
For Respondent : Mr. P.T. Ramkumar
O R D E R
The issue involved in all the petitions involves the validity of an
Arbitral award passed by a Arbitrator who is ineligible to be appointed
as per the provisions of Section 12 (5) read with schedule VII (1) of
the Arbitration and Conciliation Act, 1996, hereinafter called the 1996
Act. The arbitral proceedings is also questioned in the light of the
Chief Engineer of the respondent Railways being the authority
nominating the Arbitrator which according to the petitioner / claimant,
once again attracts the mischief of Schedule VII (1) of the 1996 Act.
It is necessary to briefly touch upon the facts which have preceded the
filing of the above Petitions under Section 34 of the 1996 Act before
proceeding to discuss the issue in detail. Since the issue involved in all
the OPs are one and the same a common order is given.
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For Petitioner : M/s. P.J. Rishikesh
For Respondent : Mr. P.T. Ramkumar
O R D E R
The issue involved in all the petitions involves the validity of an
Arbitral award passed by a Arbitrator who is ineligible to be appointed
as per the provisions of Section 12 (5) read with schedule VII (1) of
the Arbitration and Conciliation Act, 1996, hereinafter called the 1996
Act. The arbitral proceedings is also questioned in the light of the
Chief Engineer of the respondent Railways being the authority
nominating the Arbitrator which according to the petitioner / claimant,
once again attracts the mischief of Schedule VII (1) of the 1996 Act.
It is necessary to briefly touch upon the facts which have preceded the
filing of the above Petitions under Section 34 of the 1996 Act before
proceeding to discuss the issue in detail. Since the issue involved in all
the OPs are one and the same a common order is given.
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[10/13, 11:45] Sekarreporter 1: O.P.No.446 of 2019
insertion of Section 12 (5) read with the VII Schedule.
24. The amendments introduced to Section 12 by Act 3 of
2016 reiterated this concept more stringently. Therefore taking
into consideration the legislative intent and the judicial
pronouncements narrated supra it is clearly evident that the
Arbitrator who had entered the reference in the instant case is
ineligible on three grounds:
a) The general conditions of the contract does not contain
the amendments which have been brought about to clauses 64
(3) (a) (ii) and 64 (3) (b) as contemplated in the Judgement in
2019 SCC OnLine SC 1635 – Central Organisation for
Railway Electrification Vs. ECI-SPIC-SMO-MCML and
therefore the authority appointing the arbitrator was also
ineligible.
b) The arbitrator is an employee of the respondent
Railways and therefore falling within the bar contemplated under
Section 12 (5) read with schedule VII (1) of the 1996 Act.
c) There is no express waiver in writing by the petitioner of
the bar imposed under Section 12 (5) of the 1996 Act.
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25. In the above circumstances the Award in question
having been passed by an Arbitrator who is ineligible to be an
Arbitrator deserves to be set aside more particularly since there is
no express waiver in writing as contemplated under the proviso to
Section 12 (5).
26. Since the award is being set aside on the ground of the
competence of the Arbitral Tribunal to enter reference, this court
is not traversing into the merits of the Case. In fine, the
O.P.Nos.446 to 449 of 2019 are allowed and the arbitral awards
therein are set aside. No costs.
10.02.2020
mrn/kan

Index: Yes/No
Speaking order/non-speaking order
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