Petition to Challenge Appellate Award Dismissed Due to Party's Conduct

The court dismissed the petition challenging the appellate award, emphasizing that the party's conduct in pursuing the appeal without objection barred it from challenging the Appellate Authority's jurisdiction. The judgment highlighted the importance of adhering to agreed dispute resolution mechanisms and limitations on challenging jurisdiction after participating in the process.

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Issues:
1. Challenge to appellate award by Steel Authority of India Ltd. (SAIL) against an award passed by the Sole Arbitrator.
2. Interpretation of arbitration clause in the contract between SAIL and Engineers Project India Ltd. (EPIL).
3. Jurisdiction of the Appellate Authority and the validity of the appellate award.
4. Applicability of the Permanent Machinery of Arbitrators (PMA) mechanism and the Arbitration and Conciliation Act, 1996.
5. Consideration of the principle that jurisdiction cannot be vested by consent of parties in alternate dispute resolution mechanisms.

Issue 1: Challenge to Appellate Award
The petition filed by SAIL challenged an appellate award dated 17.02.2011 dismissing SAIL's appeal against an award passed by the Sole Arbitrator under the Permanent Machinery of Arbitrators (PMA) mechanism. The contract between SAIL and EPIL contained an arbitration clause, triggering the dispute resolution process. SAIL contended that the Appellate Authority lacked jurisdiction due to the designation of the adjudicator, Shri T.K. Vishwanathan, not meeting the criteria specified in the Office Memorandum (OM) dated 22.01.2004.

Issue 2: Interpretation of Arbitration Clause
The contract's arbitration clause mandated resolving disputes in accordance with the Government of India guidelines if amicable resolution failed. Being Central Public Sector Enterprises, SAIL and EPIL were bound by the PMA mechanism for arbitration. The dispute arose when EPIL filed a claim before the Sole Arbitrator, leading to the subsequent appeal by SAIL challenging the award.

Issue 3: Jurisdiction of the Appellate Authority
The core issue revolved around whether SAIL could challenge the jurisdiction of the Appellate Authority after participating in the proceedings without protest. The timeline of events, including SAIL's awareness of the adjudicator's designation and the subsequent delay in challenging the jurisdiction, played a crucial role in determining the validity of the appellate award.

Issue 4: Applicability of PMA Mechanism and Arbitration Act
The court considered the applicability of the Arbitration and Conciliation Act, 1996, in cases governed by the PMA mechanism for dispute resolution. The judgment referenced a previous case to emphasize that parties cannot exclude the application of the Arbitration Act through their agreements, highlighting the limited intervention of courts in such matters.

Issue 5: Principle of Jurisdiction in Alternate Dispute Resolution
The judgment discussed the principle that jurisdiction cannot be vested by consent of parties in alternate dispute resolution mechanisms. It underscored that SAIL's participation in the appeal process without reservation precluded it from challenging the Appellate Authority's jurisdiction post-award.

In conclusion, the court dismissed the petition and application, emphasizing that SAIL's conduct in pursuing the appeal without objection barred it from challenging the jurisdiction of the Appellate Authority. The judgment underscored the importance of parties adhering to the agreed dispute resolution mechanisms and highlighted the limitations on challenging jurisdiction after participating in the process.

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