MAHARASHTRA STATE ELECTRICITY BOARD BANDRA EAST Vs. A S JOSHI

JUDGEMENT

(1.) THIS is a petition filed by the petitioners for removing the first respondent as the sole a arbitrator, under section 11 of the Indian Arbitration Act, in respect of certain reference of disputes between the petitioners and the second respondents. Alternately, the petitioners pray that leave may be granted to the petitioners under section 5 of the Indian Arbitration Act to revoke the authority of the first respondent. Consequently, they pray that this Court may be pleased to appoint another fit and proper arbitrator to act as sole arbitrator in place of the first respondent.

(2.) THE second respondents have not contested this petition. It is the first respondent who is the arbitrator who has contested this matter. He has been an arbitrator in several matters referred to by the petitioners and he says that many of his awards have been accepted by the parties without any challenge.

(3.) THE arbitration lingered on for nearly two years. Since the arbitration was still to continue for a further indefinite period, the learned arbitrator by his letter dated January 14, 1989 sought revision of his fees. He forwarded to the petitioners as also to the other side his revised scale of fees in the form of a schedule and requested the parties to acknowledge and confirm in writing acceptance thereof to enable him to submit his future bills accordingly. The initial reaction of the petitioners was that the matter would be considered by the competent authority who would take a decision on this. It appears that the competent authority was the Chairman of the petitioners. After some correspondence, the petitioners, by a letter dated March 1, 1989 informed the arbitrator that the revision in the scale of fees was not found acceptable by the competent authority and, therefore, they requested the arbitrator to continue the assigned work as the sole-arbitrator/co-arbitrator in the same scale of fees already approved by the petitioners. In connection with his correspondence the arbitrator fixed a meeting on March 17, 1989 at Pune. He expressly stated that he was calling the meeting to discuss the situation arising out of the said correspondence. The petitioners did not attend that meeting though they have some reason as to why they could not attend the same. Further correspondence took place. The gist of the correspondence is that the learned arbitrator persisted in his claim of higher fees while the petitioners stuck to their gun by saying that they would not agree. The arbitrator thought that he could persuade the petitioners if the petitioners representative, with full authority to take a decision, attended the meeting. The petitioners would agree to send their representative to such a meeting but without full authority to decide on this particular question. Each party having taken a particular stand, it resulted in an "impasse", with no progress in the arbitration proceedings as such. However, the question, in this petition, is not that he demanded increase in his fees, but that the tone and the tenor of the language that he used in the correspondence leads to a belief in the mind of the petitioners that they may not get an unbiased verdict in the matter. Are they justified in entertaining such an apprehension?