2000 (11) TMI 1146

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....ness at Kualalumpur, Malaysia. It has an office at New Delhi and it is carrying on business of air-transportation, operation of air-flights in and from India under a bilateral agreement between Malaysia and India. It is stated that its Senior Vice President, South Asian Region, Mr. Noor Amiruddin holds a general power of attorney to act for and on behalf of the petitioner and that the said person is the Principal Officer of the petitioner-company in India. Original power of attorney dated 15-12-1997 has been produced and by order dated 3-11-2000, it was impounded for collection of stamp duty and penalty and, after overruling objections by an order dated 21-11-2000, the original power of attorney was treated as evidence under section 42(1) of the Indian Stamp Act. It is the case of the petitioner that the respondent has been appointed as General Sales Agent (passenger) for various countries and that under agreements dated 15-9-1986 and 11-1-1989, the respondent has been so appointed, the former agreement relating to passengers and the latter relating to cargo. The agreements were to be performed in India and the cause of action arose in India. The originals of the agreements are wit....

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....counter contending that the agreements dated 15-9-1986 and 11-1-1989 ceased to exist with effect from 1-5-1999 and hence there is no arbitration clause. The notice dated 25-8-1999 of the petitioner is bad in law. The petitioner has not produced the original agreements. They are not with the respondent. The petitioner cannot file attested copies of the two agreements. It is denied that Mr. Noor Amiruddin is authorised to file this suit on behalf of the petitioner. The petitioner is put to strict proof. The original of power of attorney is not placed on record (The original has since been produced, impounded and stamp duty collected and returned after substitution of a copy). Mr. Subhash Goyal is not the Managing Director of the respondent-company but is its Chairman, Mrs. Gursharan Goyal is its Managing Director. The cause of action has not arisen in India if Malaysian laws were applicable as per clause 28. The petitioner does not have an established office in North India with effect from 1-5-1999 as alleged. The termination of agreements is bad. No sums are due to the petitioner much less Rs. 96,21,137. Nothing has been admitted in letter dated 15-6-1999. There is no liability to a....

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....whether such issues raised at the stage of section 11 application or at the stage of section 8 proceedings (corresponding to section 34 of the Old Act, 1940) could be decided by the Court. This Court in some cases felt that they could be decided to cut short litigation and waste of time, where the documents are clear enough. But, subsequently the three Judge Bench in Konkan Railway Corpn. Ltd. v. Mehul Construction Co. JT 2000 (9) SC 362 has taken the view that the Chief Justice or his nominee is performing an administrative duty and cannot decide the preliminary issues at this stage and it is for the Arbitrator alone to decide the same. (No doubt, the question has now been referred for fresh consideration in Konkan Construction Corpn. Ltd. v. Rani Construction (P.) Ltd. [2000]  28 SCL 357 (SC). In view of the said three Judge judgment, I decline deciding these preliminary issues and direct that the matter be straightway referred to an Arbitrator. Point 1 is decided accordingly. Point 2 12. This question has arisen because of some observations in Dolphin International Ltd.'s case (supra). 13. Here the petitioner is a foreign company while the respondent is an Indian n....

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....f Arbitrators of a nationality other than that of one of the parties. 17. Article 6(4) of the Uncitral Arbitration Rules, 1976 stated that the appointing authority shall take into account the advisability of appointing an Arbitrator of a nationality other than the nationality of the parties. 18. The London Court of International Arbitration Rules (LCIA), 1998 say in article 6 that the "sole Arbitrator or Chairman of the Arbitral Tribunal shall not have the same nationality as any party unless the parties who are not of the same nationality as the proposed appointee all agree in writing otherwise." 19. The Rules of Arbitration of the International Chamber of Commerce, 1998 say in article 9(1) that the Court shall 'have regard to' to the prospective Arbitrator's nationality. Article 9(5) says that the Sole Arbitrator or the Chairman of the Arbitral Tribunal shall be of a nationality other than that of the party, but, in suitable circumstances and "provided neither party objects within the time limit fixed by the Court, the Arbitrator or the Chairman of the Arbitral Tribunal may be chosen from the country of which any of the parties is a national." 20. The American Arbitra....

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....iality in itself. However, it should have taken such nationality into account as a factual matter, the appearance of neutrality being as important in international arbitration as neutrality itself." In "Law and Practice of International Commercial Arbitration" by Alan Redfern and Martin Hunter (3rd Edn.) (1999), it is pointed out (at p. 215, para 4.55) that though the practice in international arbitration is normally to appoint an Arbitrator of a nationality other than that of the parties, sometimes, difficult problems can arise if a mandatory principle is applied. The following example is given : "Consider, for instance, a dispute between a Swiss company and a French company, where the law applicable to the dispute is the law of Switzerland. It seems sensible that the person chosen as the sole or presiding Arbitrator should be a Swiss lawyer, particularly if the seat of the arbitration is Switzerland. Yet the insistence on a so-called 'neutral' nationality ensures that the one person who cannot be chosen (unless the parties agree otherwise) is a Swiss lawyer." (See also 'on the Neutrality of the Arbitrator and the place of Arbitration by Lalive') (Swiss Essays on International ....