Tripura High Court
Party Name : Ratan Datta vs The State Of Tripura & Ors on 17 February, 2017
Author: T. Vaiphei
Bench: T. Vaiphei
Case No :Arb.P. 0000039/2016 Party Name : RATAN DATTA Vs THE STATE OF TRIPURA & ORS THE HONBLE THE CHIEF JUSTICE T. VAIPHEI 17.02.2017. Heard Mr. S.M. Chakraborty, the learned Sr. Counsel assisted by Mr. Arijit Bhowmik, the learned counsel for the petitioner. Also heard Ms. A.S. Lodh, the learned Addl. Govt. Advocate appearing for the State. No representation from the respondent No.4 though he has filed an affidavit objecting the application for cancellation of his appointment as sole arbitrator.
The respondent No.4 was admittedly appointed as a counsel for the State in case No.ARB/SC/RD/DWS-RIG/ 01/ 2016 arising out of Agreement No.11/ACE/EE/Rig/2012-13. The arbitrator in that case was Dr. Sumanta Chakraborty.
The respondent No.4 was engaged by the State-respondents in the Law Department to conduct their case in the said arbitral proceeding. The arbitration proceeding in question could not progress speedily. As Dr. Sumanta Chakraborty was found to be unable to discharge his function effectively as the arbitrator, this Court appointed the respondent No.4 as the arbitrator in his place.
The allegation of the petitioner in this arbitration petition is that the respondent No.4, who had once entered his appearance for the State-respondents as their Advocate in the same dispute, could not have been appointed as the arbitrator inasmuch as he would be a Judge of his own cause and would, ipso facto, adjudicate the dispute in a fair and impartial manner. The fact that the respondent No.4 had at one time appeared as the Advocate for the State is not disputed by him. However, his contention is that he had not conducted the arbitration case as the arbitrator in question did not even sit for a single day before the mandate of the Tribunal expired by the order of this Court.
According to the respondent No.4, before entering his appearance in the said arbitral proceeding, he had already given up the assignment given by the Law Department on 19.9.2016; he was, accordingly, relieved of his assignment and another Advocate namely, Sri Dilip Chandra Nath, was appointed in his place who subsequently appeared before the Tribunal in his place. Thus, he contends that there is no conflict of interest in his continuance as the arbitrator.
It is also the contention of the respondent No.4 that his appointment as arbitrator cannot be terminated by this Court inasmuch as the order appointing him is a judicial order, has attained finality under Section 11(7) of the Act; this Court has become functus officio the moment he was so appointed. It is the submission of the respondent No.4 that the only remedy available to the petitioner in a case of this nature is to file a Special Leave Petition before the Apex Court under Article 136 of the Constitution. He relies on the seven judge Bench decision of the Apex Court in M/S S.B.P. & Co. v. M/S Patel Engineering Ltd., reported in AIR 2006 SC 450.
The learned Addl. Govt. Advocate has no objection to substituting the respondent No.4 by a new arbitrator inasmuch as he never disclosed the fact that he had earlier been engaged by the Government, which is a reprehensible act on his part. Admittedly, the respondent No.4 had already acted as the counsel for the Government in the instant arbitration dispute and allowing him to continue as the arbitrator will be violative of the bias part of the principles of natural justice i.e. no person can be a Judge of his own cause.
True, he might not have entered his appearance in the arbitration proceeding as yet, but once it is found that he had once accepted the brief of the rival party as a counsel, he ought to have refused his appointment on the ground of possible conflict. Like, Caeser's wife, an arbitrator must be above suspicion. The test is whether, on the allegations made by the petitioner, there can be reasonable apprehension of bias in the mind of a reasonable man. A predisposition to decide for or against one party, without regard to the true merits of the dispute is bias. In my opinion, the fact that the respondent No. 4 has one time accepted the brief of the opposite party even though he had not made his appearance even for once can certainly give rise to reasonable apprehension of bias in the minds of the petitioner.
The learned Sr. Counsel for the petitioner submits that this is a case of inability of the respondent No.4 to perform his function de jure as contemplated by Section 14 of the Arbitration and Conciliation Act, 1996 and, as such, this Court is not helpless in invoking the provisions of Section 14 to substitute the respondent No.4 by a new arbitrator.
When there is no dispute that the respondent No.4 had once accepted the assignment of the rival party in the same dispute, he ought to have disclosed this fact to this Court when a notice was issued to him whether he was disqualified from being appointed as arbitrator of this particular case. Alternatively, when allegation of bias of this nature is made against him by the opposite, fairness demands that he should have recused from the case even if he had already appointed as the arbitrator and immediately refrained from proceeding further. It is rather surprising that the respondent No.4 instead of recusing himself resisted the application and raised several contentious issues to justify his continuance. In my opinion, this is an act unbecoming of an arbitrator. Normally, this Court would not like to interfere with the functioning of the respondent No.4, but, on the facts and circumstances of this case, as the appointing authority, this Court is deemed to have the power to remove him to prevent violation of the principles of natural justice. In the absence of a specific provision, Section 16 of the General Clauses Act, 1897 will apply, which codifies the well-known rule of general rule that the power to terminate flows naturally and as a necessary sequence from the power to create. In other words, it is a necessary adjunct of the power of appointment and is exercised as an incident to, or consequence of the power. In the view that I have taken, I am satisfied that the respondent No.4 has lost the mandate to continue as the arbitrator and is, therefore, required to be substituted by a new arbitrator.
The application is accordingly allowed. The appointment of the respondent No. 4 as the arbitrator in the instant arbitration proceeding is hereby revoked. The learned Sr. Counsel has suggested the name of Sri Amitava Dasgupta, a retired District Judge, who, according to him, has no objection to his appointment as the substitute arbitrator.
Consequently, Sri Amitava Dasgupta is hereby appointed as the substitute arbitrator. The respondent No.4 is directed to make over the entire case record to the newly appointed arbitrator without any delay and, at any rate, on or before 15.3.2017. As and when the case record is received by the newly appointed arbitrator, he shall proceed with the case as expeditiously as possible and dispose of the same within the next 6(six) months. The fees of the substitute arbitrator will be fixed by the parties by mutual agreement by taking into account the guidelines given in the Schedule to the Act.
The petition stands disposed of.
Download Date: 8-05-2017 15:05 2/2