Appointment of Arbitrator under Section 11 (6) of the Arbitration & Conciliation Act, 1996 - Failure to appoint within 30 days - Effect

Justice S. Muralidhar

The Delhi High Court in Intuitive Tech Solutions Pvt. Ltd. v. DLF Ltd. has recapitulated the legal position in cases where a party fails to appoint an arbitrator despite a request to do so by the other party, within the statutory period as prescribed in the Arbitration & Conciliation Act, 1996. While following the dicta laid down by the Hon'ble Supreme Court in Datar Switchgears Limited v. Tata Finance Limited, the Delhi High Court held as under;

11. The question whether the Respondent has forfeited its right to appoint an Arbitrator can be answered on an analysis of the facts of the present case. The documents placed on record show that the Petitioner's legal notice dated 14th September 2011 invoking the arbitration clause was received by the Respondent on 16th September 2011. However, the said notice was not in conformity with the arbitration clause since the Petitioner proposed that the appointment of an Arbitrator be done by the Respondent 'in consultation' with the Petitioner. This was contrary to the express wording of Clause 32 (b) of the Agreement. Even assuming that the notice invoking the arbitration clause was received by the Respondent on 16th September 2011, the date of appointment of the Arbitrator by the Respondent is significant. Although the letter of counsel for the Respondent informing the Petitioner of the Arbitrator is dated 17th October 2011, and dispatched on 20th October 2011, the actual decision to appoint the Arbitrator must have been taken some time prior to the said letter dated 17th October 2011.

12. In Datar Switchgears Limited v. Tata Finance Limited in para 19 it was observed as under:

"19. So far as cases falling under Section 11(6) are conceded such as the one before us no time limit has been prescribed under the Act, whereas a period of 30 days has been prescribed Under Section 11(4) and Section11(5) of the Act. In our view, therefore, so far as Section 11(6) is concerned, if one party demands the opposite party to appoint an arbitrator and the opposite party does not make an appointment within 30 days of the demand, the right to appointment does not get automatically forfeited after expiry of 30 days. If the opposite party makes an appointment even after 30 days of the demand, but before the first party has moved the Court under Section 11, that would be sufficient. In other words, in cases arising under Section 11(6), if the opposite party has not made an appointment within 30 days of demand, the right to make appointment is not forfeited but continues, but an appointment has to be made before the former files application under Section 11 seeking appointment of an arbitrator. Only then the right of the opposite party ceases. We do not, therefore, agree with the observation in the above judgments that if the appointment is not made within 30 days of demand, the right to appoint an arbitrator under Section 11(6) is forfeited." (emphasis supplied)

13. The above decision was reiterated in Punj Lloyd Limited v. Petronet MHB Limited and in a recent decision dated 9th January 2012 of the Supreme Court in Arbitration Petition No. 11 of 2011 [Denel (Proprietary Limited) v. Government of India, Ministry of Defence]. Consequently, for the purposes of Section 11, it requires to be seen is whether the appointment of the Arbitrator by the Respondent has taken place prior to the filing of the present petition on 19th October 2011.

14. It was contended by learned counsel for the Petitioner that since the notice dated 17th October 2011 was dispatched only on 20th October 2011 the appointment of the Arbitrator took place after the filing of the present petition on 19th October 2011. The above submission fails to appreciate that the actual date of appointment of the Arbitrator by the Respondent had to be prior to the notice dated 17th October 2011. The date of dispatch of the letter intimating the appointment cannot `postpone' the date of appointment. It is not possible, on the basis of the documents placed on record, to hold that the appointment of the Arbitrator by the Respondent took place after the filing of the present petition. In accordance with the law explained by the Supreme Court in Datar Switchgears Limited v. Tata Finance Limited, it is held that the Respondent did not forfeit its right to appoint an Arbitrator in terms of Clause 32 (b) of the Agreement.

Call for Papers : School of Law, Christ University Inaugural Law Journal

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Call for Papers : School of Law, Christ University Inaugural Law Journal

With great pleasure, the Journals and Publications Society, School of Law, Christ University, invites contributions on current or contemporary issues of law for the inaugural peer-reviewed edition of its Law Journal to be published in March, 2012. The Journal is an effort by the Journals and Publications Society to promote and encourage legal research and writing in the legal community. The School of law, Christ University welcomes original and well researched submissions from legal professionals, activists, academics and students. We hope this maiden attempt on our part will effectively contribute in enriching legal literature. 

Submission Guidelines

1. Submissions entertained would be under the following heads:

i. Articles: 4000-8000 words;

ii. Comments and Book Reviews: 1500-4000 words;

iii. Notes: 2500-5000 words.

2. Method of submission: Submission to the Journal can be made by e-mailing a copy of the manuscript or by posting the hard copy of the same. All submissions should be double-spaced in font size 12 following the Times New Roman format. One-inch margins should be left on both sides of the text and at the top and bottom. We encourage authors to submit their manuscripts in Microsoft Word Format and to use gender neutral language. The manuscript must not bear identification of any kind. 

3. References and Citation: We prefer the use of footnotes rather than endnotes, in size 10 following a line spacing of 1.5. The style of citation should conform to the 19th edition of The Bluebook.

4. Abstract: The manuscript must be accompanied by an abstract, not exceeding 300 words.

5. Book Review: All Book Reviews must embody all relevant information pertaining to the book being reviewed. The Review must include: title of the book; name(s) of editor(s), author(s); place of publication; name of the publisher; year of publication; number of pages of the book; and price of the book.

Procedure for submission

The submissions to the Journal can be made through e-mail or sending by post. In case of post or courier, all manuscripts must be addressed to:

Journals and Publications Society,

School of Law Christ University,

Hosur Road,

Bangalore – 560029,

Karnataka, India.

In case of submission through e-mail, a copy of the manuscript should be mailed to journals@law.christuniversity.in

Covering Letter: All submissions, both hard and electronic copies, must be attached with a covering letter mentioning the name of the author, occupation, title of the manuscript and contact address, for future reference.

Date of Submission: The last date for submission is 20th February, 2012.

For further details please contact:

Chahat Chawla: +91 8105003327

Sarah M. Mattew: +91 9008960788

Rohan Virdi: +91 8951461334

Abhishek Sharma: +91 8147387119

Object & Purpose of Slum Clearance Act : The Law

Justice Nandrajog
Delhi High Court

The Division Bench of the Delhi High Court in a recent decision in Virender Singh v State Bank of India has recapitulated the importance and object of the Slum Clearance Act in matters where the landlord seeks to evict tenants under the relevant rent control legislation. The relevant extracts from the judgment are reproduced hereinbelow;

12. The object and purpose of a Rent Control Legislation was highlighted by the Supreme Court in the decision reported as 1985 (2) SCC 683 Gian Devi Anand Vs. Jeevan Kumar. In para 23 it was observed:- 

“The Rent Acts which are indeed in the nature of social welfare legislation are intended to protect tenants against harassment and exploitation by landlords, safeguarding at the same time the legitimate interest of the landlords. The Rent Acts seek to preserve social harmony and promote social justice by safeguarding the interests of the tenants mainly and at the same time protecting the legitimate interests of the landlords. Though the purpose of the various Rent Acts appear to be the same, namely, to promote social justice by affording protection to tenants against undue harassment and exploitation by landlords, providing at the same time for adequate safeguards of the legitimate interests of the landlords, the Rent Acts undoubtedly lean more in favour of the tenants for whose benefit the Rent Acts are essentially passed.” 

13. In the context of the Delhi Rent Control Act, 1958, the word "Tenant‟ is defined in clause (ii) of Section 2(l) of the Act, as follows: 

“2 (l) “tenant” means any person by whom or on whose account or behalf the rent of any premises is, or, but for a special contract, would be, payable, and includes . . . 

(ii) any person continuing in possession after termination of his tenancy . . .” 

14. It is apparent that the definition of "tenant‟ in the Delhi Rent Control Act incorporates the concept of a statutory tenant. But since the Delhi Rent Control Act is not applicable to tenancies where the monthly rent payable is in excess of Rs. 3,500/-, the question of a tenant whose tenancy has expired by efflux of time or has been otherwise validly determined as per the Transfer of Property Act, 1882 becoming a statutory tenant does not arise. 

15. The essential object of the Slum Act is entirely different. It was noted by a Full Bench of this Court in the decision reported as AIR 1972 Del 34 (FB) Bardu Ram v. Ram Chander. It was observed:- 

“An essential object of the Slum Areas Act is to enable the poor, who have no other place to go to and who, if they were evicted to remain in their dwellings until provision is made from a better live for them elsewhere..” 

16. For holding as aforesaid, reliance was placed by the Full Bench on the decision of the Supreme Court reported as AIR 1961 SC 1602 Jyoti Pershad v. U.T. of Delhi, wherein it was observed:- 

“Obviously, if the protection that is afforded is read in the context of the rest of the Act, it is clear that it is to enable the poor who have no other place to go to, and who if they were compelled to go out would necessarily create other slums in the process and live perhaps in less commodious and more unhealthy surroundings than those from which they were evicted to remain in their dwellings until provision is made for a better life for them elsewhere...The Act, no doubt, looks at the problem not from the point of view of the landlord, his needs, the money he has sunk in the house and the possible profit that he might make if the house were either let to other tenants or was reconstructed and let out, but rather from the point of view of the tenants who have no alternative accommodation and who would be stranded in the open if an order for eviction were passed.” 

17. It is because of the difference in the object and purpose of the Slum Act and the Delhi Rent Control Act that in the decision reported as AIR 1977 SC 789 Lal Chand (dead) by L.Rs. & Ors. Vs. Radha Kishan‟, the Supreme Court observed as under:- 

“15. The Slum Clearance Act was passed, inter alia, for the protection of tenants in slum areas from eviction. As observed by this Court in Jyoti Pershad v. Administrator for the Union Territory of Delhi, (1962) 2 SCR 125 = (AIR 1961 SC 1602) the Slum Clearance Act looks at the problem of eviction of tenants from slum areas not from the point of view of the landlord and his needs but from the point of view of tenants who have no alternative accommodation and who would be stranded in the open if they were evicted. The policy of the Slum Clearance Act being that the slum dweller should not be evicted unless alternative accommodation is available to him, we are of the view that the word „tenant‟ which occurs in Section 19 (1)(a) must for the purpose of advancing the remedy provided by the statute be construed to include a person against whom a decree or order for eviction has been passed. We might mention that a Full Bench of the Delhi High Court in Bardu Ram Dhanna Ram v. Ram Chander Khibru, AIR 1972 Delhi 34 (FB) has taken the same view, namely, that the word „tenant‟ in Section 19 of the Slum Clearance Act includes a person against whom a decree or order of eviction has been passed.” 

18. Purpose of the Slum Act is to protect the occupiers of properties in slum areas irrespective whether they were tenants or not and relevant would it be to highlight that the Slum Act only defines an occupier and does not define a tenant. The object of the Slum Act is to protect the occupiers from eviction unless permission is obtained from the competent authority and relevant would it be to highlight that as per Section 19, while granting or declining permission the relevant criteria is the means of the occupier. If the occupier has no means to relocate himself, permission for ejectment has not to be granted inasmuch as it would be presumed that upon ejectment the occupier would create a further slum. It is well settled that protection under Section 19 would be available to a person, whether he is a tenant or an occupier who is poor and is unable to arrange for alternative accommodation. 

19. In the decision reported as 71 (1978) DLT 318 Dimple Pvt. Ltd. Vs. Harsh Kaur Aggarwal & Ors. it was observed that the 

The decisions referred to above clearly bring out that the protection under Section 19 of the Slum Act is not available to a company. In paras 33 to 35 it was observed as under:- 

“33. Learned Counsel for respondent No. 1, Mr. Ishwar Sahai, on the other hand has argued that the petitioner company are a jurisdiction. They are not a natural person. Thus the protection meant for the eviction of poor tenants from their respective accommodations cannot be made available to the petitioner. I find myself in perfect agreement with the learned Counsel for respondent No. 1. 

34. Admittedly the petitioners are a company. Thus they are a juristic person.A Company is formed when certain persons join hands with a view to carrying on some commercial or industrial undertaking. Thus it can naturally be formed by those persons who have got sufficient funds to carry on their business. A Company cannot be run by poor persons with no financial means to run the same. The object and the purpose for the enactment of the Slum Areas (Improvement & Clearance) Act, 1956 was to clear the slums and to provide protection to poor tenants against harassment at the hands of landlords who bring forward and initiate proceedings for their eviction... 

35. I am also tempted to cite the observations of a Single Judge of this Court as reported in Bismilla Jan v. Jain Tractors & Auto Spare, 1985 Rajdhani Law Reporter 477, (para 13).....”The Slum Act was enacted for giving protection to poor individual tenants who have small means and cannot afford to get alternate accommodation outside the slum area or within the slum if evicted. If a couple of persons with substantial means float a company which goes into losses, even if they are evicted from the premises, they cannot create slums, particularly when the same persons own other concerns which also have offices at different places”. 

20. The view taken by the learned Single Judge was earlier on taken by another Single Judge in the decision reported as 105 (2003) DLT 422 Shyam Kishore & Anr. Vs. Roop Saree Kendra. 

21. The view is incorrect for the reason it ignores the law on the subject that the concept of a contractual tenancy is only applicable where the Rent Control Legislation so envisages and that ejectment of an occupier of a property in a slum area, be the occupier a tenant or otherwise is entirely different than the issue of payment of damages for unauthorized use and occupation. A person occupying a slum property upon becoming liable to pay damages may not be evicted from the property for non-payment of damages, but that would not mean that damages cannot be recovered. The Slum Act does not regulate the rent payable by a tenant or the charges payable for unauthorized use and occupation. If the Rent Act does not apply to a slum area, rent payable would be governed as per contract between the parties and damages for unauthorized occupation as per the general law applicable. 

Call for papers: NLIU Journal of Intellectual Property Law; Submit by 15th February 2012

Call for papers: NLIU Journal of Intellectual Property Law; 

Submit by 15th February 2012

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NLIU, Bhopal

NLIU Journal of Intellectual Property Law is issuing a call for papers for its first issue which is due to be published in the current academic year. This journal is a student run, faculty regulated, peer reviewed law journal published annually by the Cell for Studies in Intellectual Property Rights (CSIPR). 

They are inviting submissions from academicians, legal professionals and students on contemporary issues relating to the development of intellectual property laws.

Guidelines for the submission: 

• The manuscript must be accompanied with an abstract of 200-250 words.

• A covering letter must be attached along with the submission containing the name, the  contact details, name and address of the Institution and academic qualifications.

• Citations must be by way of footnoting in consonance with the “The Bluebook: A Uniform System of Citation” (19th ed.).

Eligibility criteria:

• All students, academicians and legal professionals are invited to send their contributions for the journal.

• Co-authorship is permissible upto 2 authors per submission.

Last date for submissions: 15th February 2012.

Further details:

For more information contact Divya Sharma (Convenor, CSIPR, NLIU Bhopal) at (+91) 9009445313 or Upasana Kawat (Co-Convenor, CSIPR, NLIU Bhopal) at (+91)9009229892. 

Alternatively, all queries and clarifications can also be emailed to them at nliu.journalofiplaw@gmail.com or by visiting them at csipr.tumblr.com.