M/s. Woodhill-Hillways (JV) … v. ….. Mr. G. Mukherjee, Sr. Counsel being assisted by Mr. S. Dwibedi, Advocate Opposite
Case Details
IN THE HIGH COURT OF ORISSA AT CUTTACK W.P.(C) No.6064 of 2024 M/s. Woodhill-Hillways (JV) ….. Petitioner Rail Vikas Nigam Limited and others Vs. ….. Mr. G. Mukherjee, Sr. Counsel being assisted by Mr. S. Dwibedi, Advocate Opposite Parties Mr. J.K. Singh, Advocate (For Opposite Party No.1) Order No. 03. CORAM: JUSTICE SANJAY KUMAR MISHRA ORDER 06.05.2024 The matter is taken up through hybrid mode. 2. This Writ Petition has been preferred challenging the order dated 27.02.2024 passed by the Senior Civil Judge (Commercial Court), Bhubaneswar in Arbitration Petition No.16 of 2024, on the ground that the Court below has failed to grant any interim relief even though the constitution of the Arbitral Tribunal is not in consonance with the provisions of the Arbitration and Conciliation Act, 1996 (here in after, “the Act, 1996”) and the learned Arbitrators have violated the provisions of Section -12(1) of and the Sixth Schedule of the Act, 1996 . 3.
Legal Reasoning
The brief background fact, which led to filing of this Writ Petition, is that the Petitioner, who is the Claimant in the Arbitration Proceeding, is a Joint Venture concern consisting of two Joint Ventures namely, M/s. Woodhill Infrastructure Ltd. and M/s. Hillways Construction Ltd., Page 1 of 8 represented through its Power of Attorney Holder. 4. The case of the Petitioner is that the Opposite Party No.2 to 4 have been appointed as Arbitrators illegally by the Opposite Party No.1. Because of some dispute as to dismissal of the claims of the Petitioner, it invoked Clause- 20.3 for settlement of the said claim by arbitration. On 12.07.2023, when no action was taken with regard to said invocation, the Petitioner appointed its nominee as Arbitrator, who is not connected in anyway with the Ministry of Railway. It is alleged that under financial duress, being influenced by the Opp. Party No.1 and on repeated assurance that the remaining dues of the Petitioner shall be cleared; the Petitioner duressfully agreed to re-nominate its Arbitrator and appointed the Opposite Party No.4. No declaration, as required under Section-12(1), was given by the Arbitrator irrespective of clear provisions under the statute. The present Opposite Party No.1 also appointed the Opp. Party No.3 as its nominee Arbitrator and no declaration was given by the said nominee Arbitrator, thereby the appointment being in violation of Section-12(1) of the Act, 1996. The Opposite Party No.4, rather than intimating its disclosure under section 12(1) read with the Sixth Schedule, intimated the appointment of presiding Arbitrator i.e. the Opp. Party No.2. The presiding Arbitrator directed for holding of proceeding on 05.01.2023. When the Petitioner understood that its admitted dues, for which it had submitted the ‘no claim certificate’, will not be released, it revoked such ‘no claim certificate’ and requested for reconstitution of the Arbitral Tribunal as per law. The Page 2 of 8 Petitioner filed an application under section 13(2) before the Arbitral Tribunal challenging its constitution. On 05.01.2024, the alleged disclosure was issued pursuant to filing of the said application. On the very same day i.e. on 05.01.2024, the Arbitral Tribunal insisted the Petitioner to rethink/reconsider its application even though such power was not available with the Petitioner. On 10.01.2024, the Petitioner intimated its intention to continue with the application and also filed memo of citations on 18.01.2024. In response to the said Petition, the present Opposite Party No.1 filed its reply on 25.01.2024 followed by the citations on 27.01.2024, on which it wanted to rely. On 30.01.2024, the arguments of the parties were heard and the order was reserved. Ultimately, on 15.02.2024 an order was passed wherein the constitution of the Arbitral Tribunal was declared to be legal. Being aggrieved by the said order passed by the Arbitral Tribunal, the Petitioner approached the Commercial Court, Khordha on 27.02.2024, along with an application for stay of further proceeding before the Arbitral Tribunal. Though the Commercial Court, Khordha, vide impugned order dated 27.02.2024 admitted the Arbitration Application presented under Section 14(2) of the Act, 1996, latter, while ordering to issue notice to the Opposite Parties fixing the date to 22.03.2024, and was of the view that there is no urgency to pass any relief without giving any opportunity to the Opposite Parties. The said order dated 27.02.2024, being relevant, is extracted below:- Page 3 of 8 is relief. So “Later/Dt.27.02.2024 Heard on the stay petition. The ld. Counsel appearing for the Petitioner would submit that the petitioner has filed this application U/s- 14(2) of the Arbitration and Conciliation Act, 1996(Act) seeking far as for appointment of arbitrator is concerned, whether the appointment procedure illegal and without giving any opportunity to the petitioner to lead any evidence or without even filing of claim statement, the O.P. No.2, 3 & 4 has denied the allegation of duress even though in the proceeding stated that such duress cannot be proved without production of witness. Hence, the O.P. No.2, 3 & 4 have displayed the apparent partiality and bias against petitioner and there will be no dependent adjudication of the petitioner’s case. Hence, he filed this present case for relief assigned above. On perusal of the documents and the communication made through letters by both the parties, this Court does not find any urgency to pass any relief without giving any opportunity to the O.Ps. of being heard. Hence issue notice to the O.Ps. fixing dtd.22.03.2024 for appearance of the O.Ps.” (Emphasis supplied) 5. Being aggrieved by the said order, the Petitioner has approached this Court in form of present Writ Petition with a prayer to issue notice to the Opp. Parties to show cause as to why the order dtd.27.02.2024 shall not be interfered with and the mandate of the illegally constituted Arbitral Tribunal shall not be terminated. Apart from that, a prayer has also been made to declare the constitution of the Arbitration Tribunal at the behest of the Opposite Page 4 of 8 Party No.1 consisting of Opp. Party Nos.2 to 4 to be illegal and to set aside the order dtd.15.02.2024 and consequently, to terminate the mandate of the Arbitral Tribunal and in the alternative, a prayer has also been made to appoint an independent and impartial person as substitute Arbitrator to adjudicate the disputes between the parties. 6. Since one of the empanelled Counsel for the Union of India accepted the notice on 15.03.2024, instead of issuing notice to the contesting Opposite Party No.1, this Court permitted the learned Central Government Counsel to take instruction and file Counter Affidavit, if so required. Paragraph Nos.2 to 6 of the said order, being relevant, is extracted below, for ready reference:-
Legal Reasoning
“2. Heard Mr. G. Mukherjee, learned Senior Counsel being assisted by Mr. S. Dwibedi, learned Counsel for the Petitioner. 3. Mr. Kashyap, learned Central Government Counsel for the Respondents appears through virtual mode and admits to have received copy of the Writ Petition with I.A. He prays for ten days’ time to take instruction and file Counter Affidavit, if so required. 4. Mr. Kashyap also assures this Court that his client will do the needful to inform the learned Arbitral Tribunal not to proceed further until further instruction. 5. Since the impugned order reflects that the Commercial Court has posted the matter to 22nd March, 2024 for appearance of the Opposite Parties with an observation Page 2 of 2 that the application for stay of the present Petitioner shall be considered after giving opportunity of hearing to the Opposite Parties, it is made clear that pendency of the Writ Petition shall not be a bar for the Page 5 of 8 the application of Commercial Court to deal with and dispose the present of Petitioner, who is also the Petitioner in Arbitration Petition No.16 of 2024 in accordance with giving opportunity of hearing to Parties in the said case. 6. Matter be listed in the week commencing from 8th April, 2024.” law, after (Emphasis supplied) 7. However, on the very next date i.e. 08.04.2024, Mr. Singh learned Counsel engaged by the Opposite Party No.1/ Rail Vikas Nigam Limited appeared and filed Vakalatnama duly executed in his favour so also Counter on behalf of the Opposite Party No.1 dealing with the allegations made in the Writ Petition and in response to the said Counter, a Rejoinder Affidavit has also been filed by the Petitioner. 8. Since it is submitted at the Bar that the Opposite Party No.2 to 4 are proforma Opposite Parties and there is no need to notice the said Opposite Parties, on consent of the learned Counsel for the parties, matter is taken up for hearing and disposal. 9. Heard Mr. Mukherjee, learned Sr. Counsel, being assisted by Mr. S. Dwibedi, learned Counsel for the Petitioner so also Mr. J.K. Singh, learned Counsel for the contesting Opposite Party No.1. 10. During hearing, a query being made, it is submitted at the Bar that despite the Order dated 15.03.2024 of this Court, though there is no bar, the Court below is yet to dispose of the petition moved by the Petitioner under Section 151 of the C.P.C., who is also the Petitioner before Page 6 of 8 the Court below, though an Objection has already been filed by the present Opposite Party No.1 opposing to the said prayer for stay. 11. In view of such submissions made by the learned Counsel for the parties, since admittedly the application for interim relief prayed in Arbitration Petition No.16 of 2024 is pending for consideration before the Court below and an Objection has already been filed by the present Opposite Party No.1, opposing to the said prayer for interim relief, this Court is not inclined to entertain the Writ Petition at this stage, it being premature. 12. A query being made by the Court, it is submitted by the learned Counsel for the parties that the Arbitration Petition No.16 of 2024 stands posted to tomorrow (07.05.2024) for consideration of the application filed by the present Petitioner, whereas the arbitral proceeding before the Arbitral Tribunal stands posted to 16.05.2024. 13. Since the arbitral proceeding before the Arbitral Tribunal stands posted to 16.05.2024, the Court below is directed to deal with and dispose of the petition of the Petitioner under Section 151 of the C.P.C. expeditiously, preferably before 16.05.2024. 14. This Court makes it clear that it has not expressed any opinion on the merits of the case, based on the pleadings of the parties made before this Court. 15. Urgent certified copy of this order be granted on proper application as per rules. Since Arbitration Petition No.16 of 2024 stands posted to tomorrow (07.05.2024), in addition to the certified copy, the parties are at liberty to utilize the digitally signed copy of this order available in Page 7 of 8 the website of this Court, to be produced before the Court below. On being so produced, the Court below shall do well to act in terms of the observation made above. 16. With the above observations/direction, the Writ
Decision
Petition stands disposed of. Kanhu (S.K. MISHRA) JUDGE Signature Not Verified Digitally Signed Signed by: KANHU BEHERA Designation: JUNIOR STENOGRAPHER Reason: Authentication Location: High Court of Orissa, Cuttack. Date: 06-May-2024 20:59:40 Page 8 of 8