Contractual right to appoint an arbitrator ends once a Section 11(6) application is filed without prior valid appointment.

Under Section 11(6) of the Arbitration and Conciliation Act, a contractual power to appoint a sole arbitrator does not automatically lapse on expiry of the 30-day demand period; it continues only until the applicant moves the court for appointment. Once a Section 11(6) application is filed without a prior valid appointment, the opposite party's contractual right to appoint ceases. The Court held that the lower courts erred in treating the contractual clause as the exclusive remedy and in refusing to proceed under Section 11(6), and the matter had to be considered afresh for appointment of an arbitrator.

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Issues: Whether, under Section 11(6) of the Arbitration and Conciliation Act, 1996, the respondent's failure to appoint an arbitrator within 30 days of demand barred the court from appointing an arbitrator, despite a contractual clause authorising the Functional Director or his nominee to act as sole arbitrator.

Analysis: The contract reserved the appointment of the sole arbitrator to the Functional Director of the owner or a nominee, but the respondent did not make the appointment within 30 days after a demand was served. The governing principle applied was that the right to appoint is not automatically forfeited on expiry of 30 days, but it continues only until the applicant moves the court under Section 11. Once the request under Section 11(6) is filed without a prior valid appointment, the opposite party's power to appoint ceases. The designated Judge and the Division Bench therefore erred in treating the contractual clause as the sole remedy and in declining to proceed under Section 11(6).

Conclusion: The application under Section 11(6) was maintainable and the matter was required to be considered afresh for appointment of an arbitrator.

Ratio Decidendi: In proceedings under Section 11(6) of the Arbitration and Conciliation Act, 1996, a party's contractual right to appoint an arbitrator survives the expiry of the demand period only until the opposite party moves the court for appointment; thereafter, that right ceases.

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