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Lalit Singla, Proprietor Arihanta ... vs Prabhatam Advertising Pvt. Ltd. And Anr on 7 October, 2022

Author: Prateek Jalan

Bench: Prateek Jalan

                   $~5
                   *           IN THE HIGH COURT OF DELHI AT NEW DELHI

                   +           O.M.P. (T) (COMM.) 96/2022 & I.A. 15378/2022

                       LALIT SINGLA, PROPRIETOR
                       ARIHANTA CONSTRUCTIONS                          ..... Petitioner
                                      Through: Mr. Chandra Shekhar Yadav,
                                                 Advocate.
                                             versus
                       PRABHATAM ADVERTISING
                       PVT. LTD. AND ANR.                         ..... Respondents
                                      Through: Mr. Sunil Choudhary, Advocate
                                                 for R-1.
                                                 Mr. Dhananjay Sinha, Advocate
                                                 for R-2.
                   CORAM:
                   HON'BLE MR. JUSTICE PRATEEK JALAN

                                                     ORDER

% 07.10.2022

1. The petitioner has filed this petition under Section 14 of the Arbitration and Conciliation Act, 1996 ["the Act"], seeking termination of the mandate of the arbitrator who is in seisin of disputes between the petitioner and the respondent No. 1 under an agreement dated 25.04.2008 ["the Agreement"]. The parties to the Agreement agreed to resolution of disputes by a sole arbitrator being the Managing Director of the respondent No. 1. Disputes having arisen between the parties, respondent No. 2, who was the Managing Director of the respondent No. 1, entered into the reference.

2. Although the petitioner has earlier made efforts towards termination of the mandate of the learned arbitrator, Mr. Chandra Shekhar Signature Not Verified Digitally Signed By:SHITU NAGPAL Signing Date:08.10.2022 14:32:06 O.M.P. (T) (COMM.) 96/2022 Page 1 of 3 Yadav, learned counsel for the petitioner, states that there has been a significant change in the statutory regime in the interregnum, inter alia by incorporation of Section 12(5) into the Act. He relies upon several judgments of the Supreme Court and this Court including the judgment of the Supreme Court dated 04.01.2022 in Civil Appeal No. 7697/2021 [Ellora Paper Mills Limited vs. The State of Madhya Pradesh], to submit that the continuation of proceedings before the respondent No. 2 would be non est, and an exercise in futility.

3. In the aforesaid circumstances, notice was issued in the present petition on 20.09.2022. Mr. Sunil Choudhary, learned counsel, enters appearance on behalf of the respondent No.1. Mr. Dhananjay Sinha, learned counsel, enters appearance on behalf of the respondent No.2, being the arbitrator.

4. Mr. Choudhary submits that, having regard to the position of law as it stands today, the respondent No. 1 has no objection to the mandate of the present Arbitrator being terminated, and a new arbitrator being appointed in his place. He, however, submits that proceedings before the present Arbitrator have proceeded to a considerable extent, and in the interest of expeditious disposal of the proceedings, the arbitral proceedings may be taken up by the substitute arbitrator from the stage at which they are today. Mr. Yadav has no objection to the aforesaid submission.

5. Learned counsel for the respondents also submit that certain arbitral fees of the respondent No. 2 remains pending. Mr. Yadav states that the due amount will be paid to the respondent No. 2 within four weeks.

6. Having regard to the aforesaid submissions, and with the consent of learned counsel for the parties, the petition is disposed of with the following directions:-

a. The mandate of the respondent No. 2 as the Arbitrator in respect of disputes between the petitioner and the respondent No. 1 under the Agreement is terminated.

b. Mr. Dinesh Dayal, former Additional District Judge, Delhi (Mobile No. 9810100200), is appointed as the substitute Arbitrator. c. The arbitration will be conducted under the aegis of the Delhi International Arbitration Centre, Sher Shah, Road, New Delhi- 110503 ["DIAC"], and will be governed by the Rules of DIAC, including as to the renumeration of the learned Arbitrator. d. The learned Arbitrator is requested to furnish a declaration in terms of Section 12 of the Act prior to entering upon the reference. e. The learned Arbitrator will take up the proceedings from the stage at which they are today.

f. The respondent No. 2 is directed to hand over the arbitral record to the learned counsel for the petitioner and the respondent No. 1 jointly, which will be placed before the learned Arbitrator appointed by this order.

7. The petition, alongwith the pending application, stands disposed of with aforesaid directions.

PRATEEK JALAN, J OCTOBER 7, 2022 'pv'/ Click here to check corrigendum, if any Signature Not Verified Digitally Signed By:SHITU NAGPAL Signing Date:08.10.2022 14:32:06 O.M.P. (T) (COMM.) 96/2022 Page 3 of 3