2003 (5) TMI 419 - HC - Companies Law

Arbitrator's Jurisdiction Upheld in Tezpur Water Supply Dispute: Post-Award Challenge Explained

The Court upheld the Arbitrator's authority to determine jurisdiction in an arbitration dispute concerning the Tezpur Water Supply Scheme. Emphasizing the ... Arbitral Tribunal Issues:Challenge to the jurisdiction of the Arbitrator in an arbitration proceeding.Analysis:The case involved a dispute regarding the implementation of the Tezpur Water Supply Scheme, where the Board challenged the appointment of the Arbitrator on the grounds of lack of arbitration clause in the contract agreement. The Court observed that objections related to the jurisdiction of the Arbitrator must be raised before the Arbitrator, as per the Arbitration and Conciliation Act, 1996. The Arbitrator rejected the Board's contention and proceeded with the arbitration proceedings.The Board filed a writ petition challenging the Arbitrator's jurisdiction, arguing that without an arbitration clause in the contract, the Arbitrator had no authority to arbitrate. The respondent Government contended that the Arbitrator has the power to determine jurisdiction, and any party dissatisfied with the decision may challenge it under section 34 of the Act after the final award.The Court considered the constitutional aspect of judicial interference in arbitration proceedings, emphasizing the need to avoid delays and ensure expeditious dispute resolution. Referring to legal precedents, including the Kerala Education Bill case and the Kvaerner Cementation India Ltd. case, the Court highlighted that the Arbitrator has the authority to rule on its own jurisdiction, and such decisions are subject to challenge under section 34 of the Act after the arbitration proceedings conclude.Citing judgments from the Kerala High Court, Punjab & Haryana High Court, and Bombay High Court, the Court affirmed that the Arbitrator's jurisdictional decisions are not amenable to writ jurisdiction and can only be challenged under section 16(6) of the Act post the arbitration proceedings and award issuance. Consequently, the Court dismissed the writ petition, stating it was not maintainable and upheld the Arbitrator's authority to decide on its jurisdiction.In conclusion, the judgment reiterated the principles of the Arbitration and Conciliation Act, emphasizing the Arbitrator's power to rule on jurisdictional matters, which can be challenged under specific provisions of the Act post the completion of arbitration proceedings.