Case Note & Summary
The petitioner, M/s. Shaf Broadcast Pvt. Ltd., entered into a contract dated 08.03.2010 with Respondent No. 1, Doordarshan, a constituent of Prasar Bharti. The contract contained an arbitration clause providing for a three-member arbitral tribunal. Disputes arose between the parties, and the petitioner invoked the arbitration clause on 14.01.2019. The petitioner nominated its arbitrator on 28.02.2019, but Respondent No. 1 failed to nominate an arbitrator. Consequently, the petitioner filed an application under Section 11 of the Arbitration and Conciliation Act, 1996 seeking appointment of an arbitrator by the court on behalf of Respondent No. 1. During the hearing, counsel for all parties consented to modify the arbitration clause to appoint a sole arbitrator instead of a three-member tribunal. The Supreme Court, exercising its power under Section 11, appointed Mr. Justice (Retd.) A. M. Sapre, Former Judge of the Supreme Court of India, as the Sole Arbitrator, subject to declarations under Section 12 regarding independence and impartiality. The court directed that the arbitration be conducted at New Delhi, as per the arbitration clause, and that the arbitrator's fees be paid in accordance with the Fourth Schedule of the Act. The parties were directed to appear before the learned arbitrator on 15.11.2019. The petition was disposed of accordingly.
Headnote
A) Arbitration Law - Appointment of Arbitrator - Section 11 of the Arbitration and Conciliation Act, 1996 - Failure to nominate arbitrator - Petitioner invoked arbitration clause; respondent failed to nominate arbitrator - Court appointed sole arbitrator with consent of parties - Held that court can appoint arbitrator under Section 11 when party fails to appoint (Paras 1-5). B) Arbitration Law - Modification of Arbitration Clause - Consent of Parties - Three-member tribunal changed to sole arbitrator - Parties agreed to modification - Court appointed sole arbitrator - Held that arbitration clause can be modified by mutual consent of parties (Para 4). C) Arbitration Law - Seat of Arbitration - New Delhi - Arbitration clause specified New Delhi as seat - Court directed arbitration to be conducted at New Delhi - Held that seat of arbitration is as per agreement (Para 6). D) Arbitration Law - Arbitrator's Fees - Fourth Schedule of Arbitration and Conciliation Act, 1996 - Arbitrator to be paid fees as per Fourth Schedule - Held that fees are governed by statutory schedule (Para 7).
Issue of Consideration
Whether an arbitrator should be appointed under Section 11 of the Arbitration and Conciliation Act, 1996 when the respondent failed to nominate an arbitrator, and whether the arbitration clause can be modified by consent to appoint a sole arbitrator instead of a three-member tribunal.
Final Decision
The Supreme Court appointed Mr. Justice (Retd.) A. M. Sapre, Former Judge, Supreme Court of India, as the Sole Arbitrator to adjudicate the disputes between the parties. The arbitration shall be conducted at New Delhi, and the arbitrator's fees shall be as per the Fourth Schedule of the Arbitration and Conciliation Act, 1996. The parties are directed to appear before the learned arbitrator on 15.11.2019. The petition is disposed of.
Law Points
- Section 11 of the Arbitration and Conciliation Act
- 1996
- Appointment of arbitrator by court
- Modification of arbitration clause by consent
- Sole arbitrator instead of three-member tribunal
- Seat of arbitration
- Arbitrator's fees as per Fourth Schedule
