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An arbitrator appointed by one of the parties may be appointed to act as a sole arbitrator: High Court Of New Delhi

The present petition has been filed by the petitioner seeking the appointment of Sole Arbitrator under the provisions of Sections 11(5) and 11(6) of the Arbitration and Conciliation Act, 1996. and the same issue was held in the judgement passed by a single bench judge comprising HON’BLE MR. JUSTICE SURESH KUMAR KAIT, in the matter SIVANSSH INFRASTRUCTURE DEVELOPMENT PVT. LTD  V.  ARMY WELFARE HOUSING ORGANIZATION dealt with an issue mentioned above.

The petitioner was a person who was running a company whereas, The company registered under the provisions of Companies Act, 1956 claims to be engaged in construction-related activities including construction of various industrial, institutional, commercial as well as residential projects in India.

The issue was that according to the petitioner, in December 2015, the respondent invited bids for the development of a Residential Complex to be spread over an area of 3.57 acres (approx.) for construction of 220 dwelling units to be constructed in 5 Towers located at Sector-6A, Vrindavan Awas Yojna, Lucknow, to which petitioner had submitted its bid, which was accepted by the respondent vide Acceptance Letter dated 02.06.2016. The total value of the awarded project according to the petitioner was Rs.100,59,48,977.35.

The petitioner was instructed to commence the work at the Site on the even date with a Completion Period of 30 months expiring on 27.12.2018. However, since the respondent failed to hand over the site to the petitioner, a Revised Work Order dated 19.06.2017 was issued by the respondent, for the petitioner to commence the project on 12.08.2016 with the Completion Date as 11.02.2019.

It was also mentioned that because of the various delays and defaults on the part of the respondent, the contract completion was delayed and consequently, the petitioner had to seek an extension of the project with the Completion Period on various occasions up to 31.05.2019 and by then, petitioner completed the ARB.P. 830/2021 work, It was submitted that since the respondent had been unwilling to release the longstanding dues of the Petitioner, Petitioner invoked arbitration vide letter dated 22.06.2021 under Clause 174 of GCC.

Learned counsel for the petitioner submitted that appointment of Mr S.S. ARB.P. 830/2021 Bansal as Arbitrator violates dictum of Hon’ble Supreme Court in Perkins Eastman Architects DPC &Anr. vs. HSCC (India) Ltd. 2019 SCC Online SC 1517. Learned counsel has disputed the claims raised in the present petition, however, the existence of an arbitration clause is not disputed. And also they referred to the case which was held by The Hon’ble Supreme Court in Perkins Eastman Architects DPC &Anr. vs. HSCC (India) Ltd. 2019 SCC Online SC 1517.

The court perused the facts and argument’s presented, it thought that- “Because of the above, the present petition is allowed. Accordingly, Mr Justice (Retd.) B.D.Ahmed is appointed sole Arbitrator to adjudicate the dispute between the parties. The arbitration shall be conducted under the Delhi International Arbitration Centre (DIAC). The learned Arbitrator shall ensure compliance with Section 12 of the Arbitration and Conciliation Act, 1996 before commencing the arbitration. With aforesaid directions, the present petition is accordingly disposed of”.

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Judgment Reviewed by: Mandira BS

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