Once an arbitrator is not appointed as per the agreed procedure within stipulated time, right of the party concerned to appoint an arbitrator is forfeited

M/s Continental India Private Limited vs. General Manager Northern Railway [Civil Appeal No.  4829 of 2022]

RELEVANT PARAGRAPH

6.1 At this stage, the decision of this court in the case of Deep Trading Company (supra) is required to be referred to. In the said decision it is observed and held that once an arbitrator is not appointed as per the agreed procedure within stipulated time, right of the party concerned to appoint an arbitrator is forfeited and therefore, Chief Justice ought to have appointed an arbitrator under Section 11(6) of the Act. In the said decision the Corporation therein appointed the arbitrator as per the agreed procedure during pendency of the proceedings under Section 11(6) of the Act and to that it is observed and held that appointment of arbitrator by the Corporation during pendency of the proceedings under Section 11(6) of the Act was of no consequence, as failing to appoint an arbitrator within the prescribed time, the Corporation had lost its right to appoint an arbitrator.

 

6.2 In the present case also, the respondent failed to appoint an arbitrator as per the agreed procedure and in terms of the agreement. Therefore, the respondent forfeited its right to appoint an arbitrator in terms of the agreement and therefore the appellant was justified in filing the application before the High Court for appointment of a sole arbitrator in exercise of powers under Section 11(6) of the Act. The Chief Justice or his nominee thus was required to appoint the arbitrator under Section 11(6) of the Act.