Case Note & Summary
The applicant, Bombay Intelligence Security (India) Ltd., entered into an agreement with the respondent, Oil & Natural Gas Corporation Ltd., on 14th November 1995, which contained an arbitration clause (clause 2.31) providing for reference of disputes to a sole arbitrator appointed by the Director (Personnel) of the Corporation within 30 days of receipt of notice of dispute. Disputes arose between the parties, and on 9th July 2012, the applicant invoked the arbitration clause and requested the respondent to appoint an arbitrator. A reminder was sent on 26th July 2012. The respondent, by letter dated 5th November 2012, appointed Mr. J.D. Parekh as the sole arbitrator. The applicant then filed an application under Section 11(6) of the Arbitration and Conciliation Act, 1996, seeking appointment of an arbitrator by the court, contending that the respondent had failed to appoint an arbitrator within the stipulated 30 days. The court noted that the appointment was made beyond the 30-day period and that the applicant had not participated in the appointment. The court held that the respondent's failure to appoint within the agreed time entitled the applicant to approach the court under Section 11(6). The court appointed a retired judge of the Bombay High Court as the sole arbitrator to adjudicate the disputes between the parties.
Headnote
A) Arbitration Law - Appointment of Arbitrator - Section 11(6) of the Arbitration and Conciliation Act, 1996 - Failure to Appoint Within Stipulated Time - The applicant invoked arbitration clause on 9th July 2012 and sent reminders, but the respondent appointed an arbitrator only on 5th November 2012, beyond the 30-day period specified in clause 2.31 of the agreement. The court held that since the respondent failed to appoint the arbitrator within the agreed time, the applicant was entitled to approach the court under Section 11(6) for appointment. The court appointed a retired judge of the Bombay High Court as the sole arbitrator. (Paras 1-3)
Issue of Consideration
Whether the court should appoint an arbitrator under Section 11(6) of the Arbitration and Conciliation Act, 1996 when the respondent failed to appoint an arbitrator within 30 days as per the arbitration agreement despite the applicant's request.
Final Decision
The court allowed the application and appointed a retired judge of the Bombay High Court 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 by court when party fails to act
- Arbitration clause providing for appointment by Director (Personnel) of Corporation
- Time limit of 30 days for appointment
- Failure to appoint within stipulated time triggers court's power under Section 11(6)
