Saturday, 16 June 2018

Whether Arbitrator has power to set aside order terminating arbitration proceeding?

 We thus are of the view that principles underlying Order 9 Rule 13 can very well be invoked by the arbitrator. There is nothing on record to indicate that parties have agreed to the contrary. The issue, which has arisen for consideration has engaged attention of different High Courts from time to time. Patna High Court in M/s. Senbo Engineering Ltd. v. State of Bihar and Ors., MANU/BH/0350/2003 : AIR 2004 Patna 33, had occasion to consider the order terminating the proceedings Under Section 25(a). Patna High Court after considering the provision has held that arbitral tribunal has power to review on sufficient cause being shown. In paragraph 32, following has been laid down:

32. I find the submissions of Mr. Chatterjee well founded. Mr. Chatterjee has relied upon the provisions of the Act itself (that is to say, the internal aids to interpretation) in support of the point that on sufficient cause being shown, the arbitral tribunal has full authority and power to recall an order Under Section 25(a) of the Act. I think that one would arrive at the same conclusion on the basis of some external aids to interpretation.
27. Referring to judgment of this Court in Grindlays Bank Ltd. (supra) and Anil Sood v. Presiding Officer, Labour Court II, MANU/SC/2366/2000 : (2001) 10 SCC 534, Patna High Court further laid down in Paragraph 39 as given below:

39. The two Supreme Court decisions under the Industrial Disputes Act are also a pointer in the direction that the arbitral tribunal must be held to have the power of procedural review and the authority to recall, on sufficient cause being shown, an order terminating the proceeding Under Section 25(a) of the Act. The second question too is, thus, answered in the affirmative and in favour of the Petitioner.
32. We endorse the views of Patna High Court, Delhi High Court and Madras High Court as noted above, in so far as they have held that the arbitral tribunal after termination of proceedings Under Section 25(a) on sufficient cause being shown can recall the order and re-commence the proceedings.


Civil Appeal No. 15036 of 2017 (Arising out of SLP (C) No. 16636 of 2015)

Decided On: 20.09.2017

 Srei Infrastructure Finance Limited  Vs. Tuff Drilling Private Limited

Hon'ble Judges/Coram:
A.K. Sikri and Ashok Bhushan, JJ.

Citation: (2018) 11 SCC 470.
Read full judgment here: Click here

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