The Bombay High Court dealt with a review petition challenging the appointment of a sole arbitrator under the Arbitration and Conciliation Act, 1996. The Court emphasized the significance of party autonomy and dismissed the review application, affirming its previous order of appointing a sole arbitrator. The petitioner, Global Zone Sanitory Infrastructure Pvt. Ltd., sought to retract its initial agreement for a sole arbitrator, claiming a three-member tribunal was more appropriate. The Court held that since the petitioner had earlier expressed consent to a sole arbitrator appointed by the Court, the review was unfounded. The court also imposed costs on the petitioner for delaying the arbitration proceedings.

1. Parties Involved:

   • Petitioner (Review Applicant): Global Zone Sanitory Infrastructure Pvt. Ltd.
   • Respondent: Advent Infracon

2. Timeline:

   • May 25, 2022: Respondent invoked arbitration and proposed an arbitrator.
   • December 19, 2022: Petitioner responded after seven months but rejected the proposed arbitrator.
   • February 27, 2023: Respondent filed an application under Section 11(6) of the Arbitration and Conciliation Act, 1996.
   • June 20, 2024: Court appointed a sole arbitrator after the petitioner did not engage in the proceedings.
   • September 13, 2024: Court delivered judgment rejecting the review petition.

3. Dispute:

   • Petitioner initially agreed to arbitration by a sole arbitrator, provided it was court-appointed. Later, the petitioner argued for a three-member tribunal, contradicting its earlier stance.

4. Court’s Key Observations:

   • The petitioner forfeited the right to nominate an arbitrator by delaying participation.
   • The petitioner's inconsistent stance delayed the arbitration process, which is contrary to the principles of fair and efficient dispute resolution.
   • The Court emphasized that party autonomy cannot be used as a tool to frustrate proceedings.

5. Judgment:

   • The review petition was dismissed, and the court upheld the appointment of a sole arbitrator as originally agreed.
   • Costs of ₹1,25,000 were imposed on the petitioner for delaying the proceedings.

Acts and Sections Discussed:

• Arbitration and Conciliation Act, 1996, Section 11(6): Relates to the appointment of arbitrators by the Court when the parties fail to agree.

Ratio Decidendi:

The court ruled that a party that delays or frustrates arbitration proceedings forfeits the right to challenge the appointment process. The petitioner's inconsistent stance—first agreeing to a sole arbitrator and later demanding a three-member tribunal—was seen as a deliberate tactic to delay arbitration. The court held that party autonomy is fundamental, but it cannot be misused to disrupt the efficient resolution of commercial disputes.

Subject:

#Appointment of Arbitrator#Arbitration #CommercialDispute #PartyAutonomy #SoleArbitrator #ReviewPetition