Unilateral arbitrator appointment and denial of notice vitiated the award under arbitration law and public policy.

An arbitral award may be set aside where the sole arbitrator was unilaterally appointed by one party despite the absence of any written waiver under Section 12(5) of the Arbitration and Conciliation Act, 1996 read with Schedule VII. The Court held that statutory ineligibility to act as arbitrator also prevents that party from making a valid sole appointment. It further held that failure to invoke Section 13 did not bar a challenge under Section 34, and that conducting the arbitration without effective notice or opportunity to file a counter violated natural justice. The award was therefore contrary to the Act and public policy and was set aside.

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Issues: Whether an arbitral award is liable to be set aside where the sole arbitrator was appointed unilaterally by one party without the other party's written waiver, and where the proceedings were conducted without effective notice and opportunity to contest.

Analysis: The arbitration clause empowered one party to appoint the sole arbitrator, but the appointment was made without the other party's consent. Under Section 12(5) of the Arbitration and Conciliation Act, 1996 read with Schedule VII, a person falling within the disqualifying categories is ineligible to be appointed as arbitrator, and the Court applied the principle that such ineligibility also disables that party from making a sole appointment. No express agreement in writing waiving the statutory bar was shown. The Court further held that failure to challenge the appointment under Section 13 did not forfeit the right to assail the award under Section 34, and the absence of notice and opportunity to file a counter amounted to a violation of natural justice. The award was therefore contrary to the Act and to public policy.

Conclusion: The award was liable to be set aside and was set aside.

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