Case Note & Summary
The applicant, M/s. Mehra & Company, a partnership firm, filed an application under Section 11(6) of the Arbitration and Conciliation Act, 1996, seeking appointment of an arbitrator to resolve disputes arising out of a contract with the State of Maharashtra and its officers. The contract contained a multi-tier dispute resolution clause (Clause 30) providing for decisions by the Superintending Engineer, appeal to the Chief Engineer, and further appeal to the Executive Director. The applicant contended that despite making a request for appointment of an arbitrator, the respondent failed to appoint one within 30 days, thereby triggering the court's power under Section 11(6). The respondent argued that the multi-tier clause was a complete mechanism and the court should not intervene. The court, relying on the judgment in B.T. Patil Construction Vs. Maharashtra Krishna Valley Development Corporation, held that the respondent's failure to appoint an arbitrator within 30 days of the request constituted a deemed failure of the mechanism, and thus the court could appoint an arbitrator. The court appointed a retired District Judge as the sole arbitrator to adjudicate the disputes.
Headnote
A) Arbitration Law - Appointment of Arbitrator - Section 11(6) of the Arbitration and Conciliation Act, 1996 - Multi-tier Dispute Resolution Clause - The applicant contractor sought appointment of an arbitrator after the respondent failed to appoint one within 30 days of the request. The Court held that the multi-tier clause did not oust the jurisdiction of the Court under Section 11(6) as the respondent failed to act within the stipulated time. The Court appointed a retired District Judge as the sole arbitrator. (Paras 1-5) B) Arbitration Law - Deemed Failure of Mechanism - Section 11(6) of the Arbitration and Conciliation Act, 1996 - Failure to Appoint Arbitrator - The Court held that the respondent's failure to appoint an arbitrator within 30 days of the request constituted a deemed failure of the appointment mechanism, entitling the applicant to invoke Section 11(6). (Paras 4-5)
Issue of Consideration
Whether the Court can appoint an arbitrator under Section 11(6) of the Arbitration and Conciliation Act, 1996 when the agreement provides a multi-tier dispute resolution mechanism but the respondent failed to appoint an arbitrator within 30 days of the request.
Final Decision
The court allowed the application and appointed a retired District Judge as the sole arbitrator to adjudicate the disputes between the parties.
Law Points
- Section 11(6) of the Arbitration and Conciliation Act
- 1996
- appointment of arbitrator
- multi-tier dispute resolution clause
- failure to appoint arbitrator within 30 days
- deemed failure of mechanism
