Court quashes arbitrator replacement, directs application revival. Upholds Trial Court's dismissal.

The Supreme Court quashed the High Court's decision to terminate the mandate of the arbitrator and appoint a new one under section 11(6) of the Arbitration and Conciliation Act, 1996. The Court directed the revival of applications under section 14(2) of the Act for adjudication by the relevant court. Additionally, the Court upheld the Trial Court's dismissal of the appellant's application under Order VII Rule 11 of the Civil Procedure Code, emphasizing that issues of undue delay by the arbitrator should be decided by the appropriate court under section 14(2) of the Act.

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Issues Involved:
1. Termination of the mandate of the sole arbitrator under section 14(1)(a) of the Arbitration and Conciliation Act, 1996.
2. Maintainability of an application under section 11(6) of the Act, 1996 when the arbitrator was appointed by mutual consent.
3. Difference and distinction between section 11(5) and section 11(6) of the Act, 1996.
4. Justification of the High Court's decision to terminate the mandate of the arbitrator due to undue delay.
5. Justification of the Trial Court's dismissal of the appellant's application under Order VII Rule 11 of CPC.

Detailed Analysis:

1. Termination of the mandate of the sole arbitrator under section 14(1)(a) of the Arbitration and Conciliation Act, 1996:
The High Court terminated the mandate of the sole arbitrator under section 14(1)(a) of the Act, 1996, citing undue and unreasonable delay in the arbitration proceedings. The Supreme Court examined whether the High Court was justified in this decision, emphasizing that such disputes should be adjudicated by the "court" as defined under section 2(e) of the Act, 1996.

2. Maintainability of an application under section 11(6) of the Act, 1996 when the arbitrator was appointed by mutual consent:
The Supreme Court held that an application under section 11(6) of the Act, 1996 is not maintainable in the absence of a written agreement containing the arbitration clause. Since the arbitrator was appointed by mutual consent without a written agreement, the application under section 11(6) was deemed inappropriate.

3. Difference and distinction between section 11(5) and section 11(6) of the Act, 1996:
The Court clarified that section 11(5) applies when there is no agreed procedure for appointing an arbitrator, while section 11(6) applies when there is a written agreement containing the arbitration clause and an agreed procedure. The Court emphasized that section 11(6) is applicable only when there is a written agreement.

4. Justification of the High Court's decision to terminate the mandate of the arbitrator due to undue delay:
The Supreme Court found that the High Court erred in terminating the mandate of the arbitrator under section 11(6) of the Act, 1996. The Court reiterated that disputes regarding the termination of an arbitrator's mandate due to undue delay should be adjudicated by the concerned "court" under section 14(2) of the Act, 1996.

5. Justification of the Trial Court's dismissal of the appellant's application under Order VII Rule 11 of CPC:
The Supreme Court upheld the Trial Court's decision to dismiss the appellant's application under Order VII Rule 11 of CPC. The Court noted that the issue of undue delay by the arbitrator is a matter to be adjudicated on merits by the concerned court under section 14(2) of the Act, 1996, and not at the stage of deciding the application under Order VII Rule 11 of CPC.

Conclusion:
The Supreme Court quashed the High Court's judgment terminating the mandate of the arbitrator and substituting a new one under section 11(6) of the Act, 1996. The Court directed that the applications under section 14(2) of the Act, 1996, previously withdrawn, be revived and adjudicated by the concerned court. The Court also upheld the Trial Court's dismissal of the application under Order VII Rule 11 of CPC. The appeals were allowed in part, ensuring that the mandate of the arbitrator would be determined by the appropriate court.

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