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Order Terminating Arbitration Proceedings Under Section 32(2) (c) Arbitration Act Not an Award: Delhi High Court
A Single Judge Bench, comprising of Justice Vibhu Bakhru, of the Delhi High Court, has recently on Tuesday, 12th January, issued its judgement in an arbitration matter. The matter heard was a plea filed by PCL Suncon whereby they requested for the substitution of their arbitrator with another independent arbitrator under Section 14(1)(a) read with Section 15 of the Arbitration & Conciliation Act, 1996. The procedural history is that the arbitration proceedings between the petitioner (PCL Suncon) and the respondent (NHAI) had been dismissed/terminated by the previously appointed two arbitrators because the petitioner (PCL Suncon) had not nominated another arbitrator when the previously nominated arbitrator had resigned.
The Respondent (NHAI) argued against the petitioner's (PCL Suncon) plea by saying that the arbitral proceedings had been terminated by an order issued under Section 32(2)(c) of the Arbitration & Conciliation Act, 1996. The Court opined that the termination of arbitral proceedings by an order under Section 32(2)(c) of the Arbitration & Conciliation Act, 1996 did not qualify as a bar to challenge against the concerned order under Section 14(2) of the Act.
The Court reached this conclusion by placing its reliance on the judgement given by the apex court of the country in Lalitkumar V Sanghavi and various other cases where the Court had found that an award referred to the final decision made in the matter on the issues presented before the arbitrators. The Court further elaborated that where the arbitral proceedings had been terminated before a solution had been reached can not be considered an award.
Further, when considering the particulars of the matter at hand , the Court found that the petitioner had not been notified before the termination order had been issued under Section 32(2)(c) of the Arbitration & Conciliation Act. However, the Court also acknowledged the fault of the petitioner in this matter and ordered for the impugned order to be set aside when and if the petitioner paid costs of 25,000 rupees.
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