Indian Kanoon - Search engine for Indian Law

(24) The question thus is when the arbitrator entered on the reference. There has been difference of opinion on this.

(25) In Baker Vs. Stephens (1867) 2 Qb 523, it has been held that an arbitrator enters on a reference, not when he accepts the office, or takes upon himself the functions of arbitrator by giving notice of his intention to proceed, but when he enters into the matter of the reference, either with both parties before him or under a peremptory appointment enabling him to proceed ex parte. The Allahabad High Court in a previous case in Sardar Mal Hardat Rai Vs. Sheo Baksh Rai Sri Narain, Air 1922 All. 106 adopted this view.

(28) A different view has been expressed later by English Court of Appeal in Iossifoglu Vs. Coumantaros (1941) 1 Kb 396 where it was held that the arbitrators entered upon a reference as soon as they have accepted their appointment and have communicated with each other about the reference. In other words, the arbitrator enters upon a reference not necessarily at the time of actual hearing by them but even at a much earlier stage. Baker's case (supra) was not considered in this case.

(29) This latter view of English Court has been adopted in some of the decisions by some High Courts Bajranglal Laduram Vs. Ganesh Commercial Co. Ltd. ; Harish Chandra Saxena Vs. Union of India 1965 (Suppl.) Punjab Law Reporter 206. In both the cases it was held that the arbitrator entered on the reference when notice was given to the parties for filing their statements.

(32) The Orissa High Court in M/s. Kalinga Otto (P) Ltd. Vs. M/s. Charanjit Kochhar has followed Patna High Court referred to below view that an arbitrator enters upon a reference when after accepting the reference, he applies his mind and does something in furtherance and execution of the work of arbitration.

(33) A Division Bench of the Patna High Court in Soneyal Thakur Vs. Lachhminarain Thakur has disagreed with Iossifoglu Vs. Coumantaros's case to the extent it was held that the arbitrators enter upon a reference as soon as they accept their appointment. But it was followed to the extent that they entered upon the reference when they communicated with each other about reference. In Dr. Babubhai Vanmalidas Vs. Prabhod Pranshankar, while agreeing with the contention that an arbitrator does not enter upon reference the moment he accepts his appointment but when takes upon himself an exercise of a function referable to his position as an arbitrator. It was held that where an arbitrator held preliminary meeting and gave directions to the parties as to the progress of the arbitration proceedings before him, he then exercised the functions of an arbitrator and then has entered upon the reference.

(35) And the questions referred were answered as follows :- (1)An Arbitrator does not enter on the reference as soon as he assumes the office of an Arbitrator. An Arbitrator does not necessarily enter on the reference when he actually commences the decision of the matter in the presence of both parties or ex parte. An Arbitrator enters on a reference when he first applies his mind to the dispute or controversy re him depending on the facts and circumstances of each case."

(36) BABUBHAI'S case has not been followed by a Division Bench of the Bombay High Court in Jolly Steel Industries Vs. Union of India but has followed Full Bench judgment of Calcutta High Court in Ramanath Agarwalla Vs. M/s. Goenka & Ors. and others and it has been held that : "An arbitrator does not enter on the reference as soon as he assumes the office of an arbitrator. The arbitrator does not necessarily enter on the reference when he actually commences the decision of the matter in the presence of both parties or ex parte. An arbitrator enters on a reference when he first applies his mind to the disputes or controversy before him depending on facts and circumstances of each case. "