TaxTMI 
TaxTMI 
2014 (8) TMI 1236
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.... proceedings arising out of two contracts bearing No. CAO/CON/722 dated 01.11.1993 and CAO/CON/738 dated 28.04.1994. 2. Both the contracts awarded to the Respondent-contractor were terminated on 7.11.1994. Admittedly, the General Conditions of Contract of the Railways, which included an arbitration clause, governed the parties. After the termination of the two contracts the Respondent-contractor approached the Patna High Court by means of a writ petition challenging the terminations. The writ petition was dismissed, which dismissal was challenged before this Court in SLP(C) No. 17189/1995. The said special leave petition was also dismissed leaving parties to resolve the differences in an appropriate proceeding i.e. a civil suit or by refer....
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....oth the parties have tried to lay the blame for the delay in the process of arbitration on each other and the huge number of correspondence exchanged in this regard and the frequent change of the arbitration panel on account of exigencies of service of the panel members (retirement, transfer etc.) has made it impossible to pinpoint the responsibility in this regard on any one of the contracting parties. But what is glaring is the fact that though the arbitration proceedings in respect of the said contract No. CAO/CON/722 had commenced as far back as in the year 1996 the award is yet to see the light of the day notwithstanding the assertions made by the Union that the proceedings have been completed though as already noted, no clinching mate....
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.... from amongst the 3 arbitrators so appointed. While nominating the arbitrators it will be necessary to ensure that one of them is from the Accounts department. An officer of Selection Grade of the Accounts department shall be considered of equal status to the officers in SA grade of departments of the Railways for the purpose of appointment of arbitrators. 64(3)(a)(iii)-If one or more of the arbitrators appointed as above refuses to act as arbitrator, withdraws from his office as arbitrator, or vacates his/their office/offices or is/are unable or unwilling to perform his functions as arbitrator for any reason whatsoever or dies or in the opinion of the General Manager fails to act without undue delay, the General Manager shall appoint new....
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....he Act to the High Court, the opposite party would lose its right of appointment of the arbitrator(s) as per the terms of the contract. The implication that the Court would be free to deviate from the terms of the contract is obvious. The apparent dichotomy in ACE Pipeline (supra) and Bharat Battery Manufacturing Company (P) Ltd. (supra) was reconciled by a three Judges Bench of this Court in Northern Railway Administration, Ministry of Railway, New Delhi v. Patel Engineering Co. Limited (2008) 10 SCC 240 where the jurisdiction of the High Court Under Section 11(6) of the Act was sought to be emphasized by taking into account the expression "to take the necessary measure" appearing in Sub-section (6) of Section 11 and by further laying down....
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...., statutory authorities and government companies should consider phasing out arbitration clauses providing for appointment of serving officers and encourage professionalism in arbitration. 7. A pronouncement of late in Deep Trading Co. v. Indian Oil Corporation and Ors. (2013) 4 SCC 35 followed the legal position laid down in Punj Lloyd Ltd. (supra) which in turn had followed a two Judges Bench decision in Datar Switchgears Ltd. v. Tata Finance Ltd. (2000) 8 SCC 151. The theory of forfeiture of the rights of a party under the agreement to appoint its arbitrator once the proceedings Under Section 11(6) of the Act had commenced came to be even more formally embedded in Deep Trading Company (supra) subject, of course, to the provisions of Sec....