Final Order 2

Order Details: COPY OF JUDICIAL PROCEEDINGS
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19 EX 842/23
SBI CARDS AND PAYMENTS SERVICES LIMITED Vs.
BRIJESH KUMAR
02.02.2024
Present: Sh. Shivam Sharma, Ld. counsel for the DH.
Present court has raised a query regarding maintainability
of the present execution petition in terms of order Kotak Mahindra
Bank Ltd vs Narendra Kumar Prajapat EFA (COMM) No. 3/2023,
decided on 17.05.2023 passed by Hon’ble High Court of Delhi. The
Division Bench of Hon’ble High Court of Delhi has held that an
arbitral award passed by an arbitrator unilaterally appointed by a party
is a nullity and thus, cannot be enforced.
In the present case, the arbitral award reflects that the
Claimant/DH has appointed the sole arbitrator. Subsequently, upon ex-
parte arbitral award, the DH has filed present execution petition as the
arbitral award is deemed to be a decree/order of the Court. Thus, the
said act of the DH reflects that the authority was with the DH to
appoint the Sole Arbitrator. On the face of it, the appointment of
Arbitrator without the consent of JD was unilateral and Award passed
by such Arbitrator is not enforceable.
Furthermore, if a single party to the agreement is allowed
to unilaterally appoint the Arbitrator, then it would defeat the purpose
of the impartial arbitration adjudication of the disputes between the
parties. As per the provisions of the Arbitration and Conciliation Act,
contd...
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1996, the Arbitrator either has to be appointed with consensus of the
parties or by the court. Cases wherein the clause of contract between
the parties give right of appointment of Arbitrator to one party only,
the said clause clothes one of the parties to the contract with the
exclusive right to appoint the arbitrator. Such a clause is not
enforceable in law and is also violative of section 12(5) of the
Arbitration and Conciliation Act, 1996. Thus, it is established that the
appointment of Arbitrator by DH is unilateral and the same is contrary
to the provisions of the Arbitration and Conciliation Act.
Hence, in view of above discussion, present execution
petition stands dismissed as the arbitral award is not enforceable.
File be consigned to record room after due compliance.
Siddhant Sihag
ACJ/CCJ/ARC, NDD, PHC
02.02.2024
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