Unilateral arbitrator appointment and ex parte process can render an arbitral award vulnerable to challenge for lack of fairness.

An arbitral award was found vulnerable to challenge under Section 34 where the sole arbitrator was appointed unilaterally despite an arbitration clause requiring consent, and the arbitrator's communications showed alignment with one side rather than neutral case management. The petitioners' refusal to participate, after timely objection to the appointment, was not treated as abandonment of their rights. The award was also considered unsustainable because it proceeded ex parte on the claimant's assertions without adequate evidentiary support or a fair adjudicatory process. The award, and the execution proceedings based on it, were set aside.

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Issues: Whether the arbitral award was liable to be set aside under Section 34 of the Arbitration and Conciliation Act, 1996 on the ground that the arbitrator was appointed unilaterally, acted in a dual capacity, and proceeded ex parte without fair opportunity to the petitioners.

Analysis: The arbitration clause was construed as requiring consent for appointment of the sole arbitrator. The appointment was made unilaterally by one side, and the arbitrator's communications went beyond a neutral procedural notice and reflected the stance of that side, showing a dual role as advocate and arbitrator. The petitioners had expressly objected to the proceedings and declined participation from the outset, so their non-appearance was not treated as deliberate abandonment. The award was also found unsustainable because it proceeded ex parte on the claimant's assertions without proper evidentiary support and without affording a fair adjudicatory process.

Conclusion: The award was held liable to be quashed and set aside, along with the execution proceedings arising from it, in favour of the petitioners.

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