G.R. Luthra, J.
(1) THE present petition under sections 5 and 11 of the Indian Arbitration Act is either turn revoking the authority of the arbitrator or removing him and for superseding the arbitration.
(2) ON an application under section 20 of the Arbitration Act filed by M/s. Krishan Chander Ramesh Chander & Bros. (respondent No. 1), Avadh Behari J. vide order dated August 24, 1981 referred the dispute between the petitioner and respondent No. 1 to an arbitrator to be appointed by Delhi Hindustan Mercantile Association, (hereinafter referred to as the Association). The said association appointed Shri Mohan Lal, respondent No. 3 as the arbitrator.
(3) THE allegations of the petitioner are that Shri Mohan Lal, arbitrator is partial and biased towards the petitioner and that, thereforee, either permission be given under section 5 of the Arbitration Act to revoke his authority or he should be removed under section 11 of the Arbitration Act and the arbitration be superseded. The petition is lengthy one and the narration as to how the proceedings went on in the arbitration has been made. It is only out of that narration that the grounds on the basis of which the petitioner prays for the aforesaid relief could be spelled out. The sum and substance of the said grounds is as under :
(A)The arbitrator did not attend on all the dates fixed for the arbitration proceedings. Many a times his clerk had been giving dates of hearing in the absence of the arbitrator. The same constituted a misconduct of proceedings on the part of the arbitrator.
(B)Against the order dated August 24, 1981 of Avadh Behari J. an appeal was filed by the petitioner. The Division Bench who took cognizance of the appeal stayed the arbitration proceedings vide order dated 30th October, 1981. On November 3, 1981, the petitioner intimated the arbitrator that further proceedings had been stayed and that he should not proceed further. To utter surprise of the petitioner, the arbitrator did not stay the proceedings and adjourned the case to November 24, 1981. However, no further proceedings were taken thereafter. The division bench dismissed the appeal on July 5, 1983. Thereafter, the petitioner received & notice for the fixing of the arbitration proceedings on September 23, 1983.
(C)The petition under section 20 of the Arbitration Act was based on 84 bills which, according to respondent No. 1, were payable by the petitioner. But before the arbitrator, respondent No. I produced a statement of account relating to 137 such bills which included 84 bills also. That means that the statement of account was regarding 53 bills which was not the subset matter of the petition under section 20 of the Arbitration Act as a result of decision of which an arbitrator was appointed. In this way the respondent No. 1 was widening the scope of arbitration proceedings to which the arbitrator should have objected, which he failed to do and thus misconducted himself.
(D)The apprehension of the petitioner that he is not likely to get justice from the arbitrator was further fortified when the former learnt that Shri R. K. Tandon, Advocate who was the office secretary/ legal adviser of the association for the last 15 years and at whose advice arbitrators were appointed by the association, was interested in respondent No. 1. The interest of Shri R. K. Tandon, Advocate in respondent No. 1 is clear from the fact that he is standing counsel for the latter in a number of cases. Particulars of five such cases have been mentioned in paragraph 26 of the petition.
(E)Many a time the petitioner, on account of urgent necessity, had been asking for adjournments, but the arbitrator had been mostly refusing the same, which showed bias of the arbitrator against the former.
(F)The petitioner filed a number of applications in respect of various subjects but none of them was decided.
(G)Obstructions were placed in the inspection of the file of the arbitrator by the respondent No. I or his counsel. The petitioner applied on 22nd June 1984 for inspection of files and the inspection was allowed on 10th July 1984 after putting lot of hurdles.
(4) RESPONDENT No. 1 contested the petition. He denied that the arbitrator Was biased against the petitioner. He also denied that the arbitrator was favoring the former. The contention of respondent No. 1 is that this application has been given only for the purpose of delaying the proceedings with a view to avoid the dues of the former as long as possible. It is admitted that on some dates when the arbitrator was not present, his clerk fixed the next date of hearing but stated that that did not amount to any misconduct because the clerk was merely adjourning the matter and was not acting on behalf of the arbitrator. He denied that Shri R. K. Tondon, Advocate was office secretary of the association. He also denied that Shri R. K. Tandon was looking after the affairs of the said association or that he was giving legal advice to the arbitrators appointed by the association. He further denied that draft of the awards was done by Shri Tandon. It is also denied that Shri R. K. Tandon is standing counsel of respondent No. 1. The case of the said respondent is that the said firm had been engaging M/s. AARS Chambers as their advocates and Mr. R. K. Tandon happens to be one E of the partners of the said chambers. It is admitted that Shri R. K. Tandon had been handling the cases of respondent No. I, as mentioned in paragraph 26 of the petition. The contention of respondent No. 1 is that all the allegations relating to Shri R. K. Tandon were merely concocted with a view to somehow show lack of independence on the part of the arbitrators.
(5) RESPONDENT No. 1 admitted that statement of account relating to 137 bills was filed but that did not mean that the dispute was in respect of those bills. It is explained that Payment had been made in respect of earlier 53 bills and that the dispute was only in respect of payment of the remaining 84 bills.
(6) FOLLOWING issues were framed on March 18, 1985 :-
1.Is the petition legally maintainable OPP (Onus objected to). court and what is its effect OPR.
2.Is the petition a gross abuse of the process of the
3.Is the authority of the Arbitrator liable to be revoked for the reasons stated in the petition OPP.
4.Is the petitioner estopped from filing this petition on account of his acts and conducts OPR.
5.Relief.
(7) THE petitioner filed an application (I.A. 2885185) with a prayer that Krishan Chander, one of the partners of respondent No. 1, who had filed an affidavit in support of the case of respondent No. 1, be called and allowed to be cross-examined by the petitioner. The reason given is that the petitioner wants to prove from the said cross-examination that Mr. R. K. Tandon, Advocate was standing counsel for respondent No. 1, that he was also the legal adviser of respondent No. 2 Association and that he was intimately connected with the said Association for the last so many years. The said application is contested by respondent No. 1 on the ground that even if the facts sought to be proved from the crossexamination of Krishan Chander stand established, the case of the petitioner does not receive any strength and that it will be totally purposeless to allow the cross-examination of Krishan Chander.
(8) I have heard the counsel for the parties in respect of the main petition (OMP 84/84) and the aforesaid interim application (I. A. 2885/85). The findings on the issues and the decision of the application is as follows :
(9) ISSUE No. 1. It is well established that if there is a reasonable ground for the apprehension that the arbitrator is biased, permission to revoke his authority can be given on the application of a person who has that apprehension. It was so held in M/s. Amarchand Lalit kumar v. Shree Ambica Jute Mills Ltd., : [1963]2SCR953 . However, a note of caution was attached to the effect that before a court exercises its discretion to give leave to revoke authority of an arbitrator, it should be satisfied that a substantial miscarriage of justice will take place in the event of its refusal. It was-further held that in exercising this discretion cautiously and sparingly, the court has no doubt to take into view the circumstances that the parties should not be easily relieved from a tribunal they had chosen themselves on the ground of the fear that the arbitrator's decision might go against them. The Supreme Court then observed
'The grounds on which leave to revoke may be given have been put under five heads : (1) Excess or refusal of jurisdiction by arbitrator ;
(2)Misconduct of arbitrator ;
(3)Disqualification of arbitrator ;
(4)Charges of fraud ; and
(5)Exceptional cases.'
(10) IN the present case the petitioner complains that the arbitrator has misconducted himself and that thereforee he has reasonable apprehension that he will not get justice. On this ground the application can be legally maintained although it is to be seem if in the circumstances of the case it stands established if the apprehension in the mind of the petitioner is reasonable or not or his motive is only to delay the proceedings of the arbitration.
(11) THERE is no necessity of taking into consideration any other authority in this respect, when there is a judgment of the Supreme Court. However, I may mention some of the authorities which were cited at the bar by the counsel for the petitioner. They are Girdhari Lal v. Gobardhan Das ; State of Orissa and another v. M/s. Modem Construction Co., : AIR1972Ori219 , Bhuwalka Bros. Ltd. v . Fatehchand Murlidhar, : AIR1952Cal294 and Anand Das v. Rambhushan Das, AIR 1933 Patna 566.
(12) THE issue is, thereforee, accordingly to the effect that if there is a case of reasonable apprehension in the mind of the petitioner to the effect that the arbitrator is biased against him and miscarriage of justice is made out, the application 18 maintainable.
(13) ISSUES No. 2 & 3. It is to be seen if there was a misconduct on the part of the arbitrator, as alleged by the petitioner and on that the arbitrator appeared to be biased against the petitioner and in favor of the respondent No. 1, so as to justify an inference that there will be miscarriage of justice. I have already enumerated the sum and substance of the grounds set up by the petitioner, on the basis of which the petitioner wants to show that there was misconduct of the proceedings. I will be dealing with the allegations connected with the role of Shri R. K. Tandon, Advocate separately. First of all I take up other allegations.
(14) THE mere fact that the arbitrator did not attend on all the dates fixed by him is not a misconduct at all. After all the arbitrator is a human being and he can have some circumstances on which he could not attend. Further an arbitrator has to carry on his own avocation also and he cannot devote himself to the arbitration proceedings only. Under these circumstance, he could have very well been absent. The fact that his clerk was giving adjournments in his absence does not mean that the arbitrator had abdicated his authority in favor of his clerk. It was for the convenience of the parties that a clerk was deputed by him to see that the parties had not to wait and should go away immediately after taking next date of hearing.
(15) IT is wrong on the part of the petitioner to say that the proceedings of arbitration were not stayed inspire of the stay granted by the division bench in the appeal against an order of Single Bench dated 24th August, 1981. The proceedings actually remained stayed and they were re-started only after the appeal was dismissed by the division, bench of this court on July 5, 1983. The arbitrator merely adjourned the case to November 24, 1981 after he was intimated by the petitioner on November 3, 1981 that the aforesaid stay bad been granted. That adjournment did not mean taking of any proceedings. It is obvious that the adjournment was given with a view to ascertain the factum of stay. There was thus no misconduct on the part of the arbitrator.
(16) THERE is no doubt that the petition under section 20 of the Arbitration Act was based on 84 bills. There is also no disagreement between the parties that the disputes between them relate to those 84 bills. The respondent No. 1 is still pressing for the recovery of the amount on the basis of those bills. The said respondent does not want any recovery on the basis of the remaining 53 bills, which were included in the statement of account. It appears that respondent No. 1 wanted to give a complete picture of the transactions between the parties and then say that the amount was due in respect of 84 bills in dispute.
(17) LEARNED counsel for the petitioner contends that there is another grievance also of the petitioner. He explains that inspire of the fact that the petitioner has been requesting the arbitrator to direct respondent No. 1 to produce the original 84 bills. The same were not produced, that he also requested the arbitrator to direct respondent No. 1 to give him copies of the said bills but that request remained unheeded and that that clearly shows that the arbitrator was biased against him and was favoring respondent No. 1.
(18) BUT the aforesaid contention of the counsel is baseless in view of the fact appearing on record. Sohan Lal during proceedings under section 20 of the Arbitration Act (Suit No. 123 of 1980) filed an affidavit dated January 5, 1981, the relevant portion of which reads as under :-
'3.That on the same day I have filed 77 (Seventy Seven) Bills in original which were found in our records.
4.That I hereby make oath and say that the original bills sought to be produced by the plaintiff other than those which have been filed by me are not available in our records and thereforee those original bills sought to be produced by the plaintiff.
5.That the plaintiff under Evidence Act is entitled to prove these other bills by secondary evidence. 6. That I have already waived the formal proof of all the bills filed by the plaintiff which can be read in evidence.'
(19) IT is apparent from the above that it was the petitioner who was in possession of original seventy seven bills. He himself produced those bills during the proceedings under section 20 of the Arbitration Act. thereforee, the respondent No. 1 could not produce the said bills in original and also there was no necessity of giving of any copies of the said bills to the petitioner. As far as remaining 7 bills are concerned, the, originals could be with the petitioner but the same could not be produced by him. May be those 7 bills were lost. In any case, they could not be with respondent No. 1 and hence the E petitioner has no basis to complain about the non-production of those originals. It is apparent that the grievance of the petitioner in this respect is merely an attempt to had out some pretext on which he can claim existence of misconduct of the proceedings on the part of the arbitrator.
(20) THE mere fact that the arbitrator did not give some adjournments or adjournments of the period asked for by the petitioner is no ground for saying that there was misconduct of the proceedings. An arbitrator as a judge has a right to refuse adjournment. However, in this respect it is worthy of noting that the arbitrator in this case has been accommodating the petitioner many a times because on some dates of hearing he did not appear and yet the arbitrator issued notice a him in respect of the next date of hearing. That clearly indicates that the arbitrator often went out of the way to appease the petitioner. It is, thereforee, wrong on the part of the petitioner to allege misconduct of the arbitrator.
(21) THE proceedings before the arbitrator are not just like a court. It is not necessary that the arbitrator must decide all the applications. He can take into consideration the same at the time of the decision on merits. Even otherwise, leaving some applications undecided does not mean misconduct on his part.
(22) THERE was some delay in inspection of the files by the petitioner. But that by itself does not indicate any bias against him on the part of the arbitrator.
(23) BEFORE dealing with the ground relating to Shri R. K. Tandon, Advocate, it is necessary to decide I. A. 2885/85. The prayer in that application is that Krishan Chander, a partners of respondent No. 1 firm be summoned as a witness for cross-examination by the petitioner with reference to an affidavit of Krishan Chander dated April 24, 1985 filed in the court The reasons for such prayer are mentioned in paragraphs 4 and 6 of the aforesaid application. The said paragraphs read as under :-
'4.That one of the grounds relied upon by the petitioner is that Shri R. K. Tandon, Advocate is the standing counsel for respondent No.1 and that he is also the legal adviser of respondent No. 2/Association/Arbitrator and is deeply connected with respondent No. 2 for the last so many years.
5.That the affidavit dated 24-4-1985 filed by Shri Krishan Chander of respondent No. 1 is deliberately vague and evasive and contains false allegations which can be shown to be false from his own mouth from the cross examination of the said Shri Krishan Chander.'
(24) RESPONDENT No. 1 admitted that Shri R. K. Tandon, Advocate was his counsel in the cases mentioned in paragraph 26 of the petition as well as in the application under section 20 of the Arbitration Act, as a result of decision of which the Association was called upon to appoint an arbitrator in the present case. Even if we presume for the purpose of deciding the main petition (OMP No. 84/84) that Shri R. K. Tandon, Advocate was office bearer and legal adviser of the Association, the petitioner, as is being mentioned hereinafter, does not succeed. When such presumption is raised for the purpose of deciding the main petition, obviously there is hardly any necessity of calling Krishan Chander as a witness for cross-examination. Hence the application is liable to be dismissed.
(25) THE mere fact that Shri R. K. Tandon, Advocate is a legal adviser of respondent No. 1 as well as the Association cannot give any reflection on the part of the arbitrator Shri Mohan Lal or even the Association. It can neither be said nor there dan be any justification for inferring that Shri R. K. Tandon, Advocate will try to influence the arbitrator or the Association. Normally an advocate is neither expected nor does so. Moreover, there is hardly any basis to say that Shri Mohan Lal, respondent No. 3, who is actually carrying on the arbitration proceedings, can be influenced by Shri R. K. Tandon, Advocate He is an independent person having no connection with Shri R. K. Tandon, Advocate. How it can be said or even inferred that Shri Mohan Lal, arbitrator has become biased or prejudiced against the petitioner and in favor of the respondent No. 1 merely because Shri R. K. Tandon, happened to be counsel for respondent No. 1 and is legal adviser of the Association. I am of the view that not only that the alleged apprehension of the petitioner in respect of respondent No. 3 being biased is without any basis but also the petitioner has taken up this ground only with a view to cause delay in the proceedings and he has no genuine apprehension.
(26) IN this respect a judgment of H. L. Anand, J. in M/s. Bhilwara Synthetics Ltd., New Delhi v. Delhi Hindustani Mercantile Association and others, AIR 1982 Delhi 155, (6) is very pertinent. In that case M/s. Bhilwara Synthetics Ltd. was once a member of the Association. He resigned. That resignation was not accepted with the result that the said company took the matter to a civil court on account of which the Association relented and accepted the resignation. In spite of the fact that there was even litigation between the said company on the one hand and the Association on the other hand, it was held that the misgivings and the apprehensions of the said company to the effect that the Association as well as the arbitrator appointed by the Association was biased, were baseless. The result was that the petition of the said company under section 5 of the Limitation Act for permission to revoke the authority of the arbitrator was dismissed. During the pendency of the petition, the arbitrator had recorded ex-parte evidence against that company. With the consent of the Association it was held that the proceedings would be held afresh. and that the arbitrator would give a reasoned award. In The present case also, the mere fact that Shri R.K. Tandon, Advocate happens to be legal adviser of the Association as well as respondent No. 1 cannot be a good basis for holding that the alleged apprehensions of the petitioner to the effect that Shri Mohan Lal, Arbitrator and the Association are biased in favor of respondent No. 1 and that there will be miscarriage of Justice are reasonable and well founded.
(27) UNDER the above circumstances the issues are decided in favor of respondent No. 1.
(28) ISSUE No. 4 It was not shown at the time of arguments as to how the petitioner is estopped from filing this petition. In fact no arguments were addressed on this point. The issue is thereforee decided in favor of the petitioner.
(29) RELIEF In view of the aforesaid findings, I dismiss the petition with costs.
(30) THE parties are directed to appear before the arbitrator on February 3, 1986 at 4 P.M. The time for making the award is extended by four months from February 3, 1986.
(31) A copy of this order along with the file of the arbitration proceedings shall be sent to the arbitrator immediately and it should be ensured that they reach the arbitrator before February 3, 1986.