The Aryavarth Express
Agency (Punjab and Haryana): The Punjab and Haryana High Court recently voiced its displeasure with state entities for their habit of vehemently opposing arbitrator appointment applications, often citing trivial objections. In a case involving the Punjab Heritage and Tourism Promotion Board, Justice Suvir Sehgal dismissed these objections, noting the trend’s potential to undermine the 1996 Act’s goal of prompt and effective dispute resolution.
The court was considering a petition under Section 11(6) of the Arbitration and Conciliation Act, 1996, filed by M/s Knight Frank (India) Pvt. Ltd. The company sought the appointment of an arbitrator for a dispute with the Punjab Heritage and Tourism Promotion Board. The petitioner’s counsel argued that the sole arbitrator’s appointment by the Principal Secretary, Tourism, Punjab, violated the Act as the secretary was an interested party.
Justice Sehgal observed that the Secretary, also a trustee of the respondent, was ineligible for arbitration or to appoint an arbitrator, referencing the Supreme Court’s ruling in Perkins’s case and M/s Glock Asia – Pacific Limited Versus Union of India.
The Board contested the plea with several objections, including the claim that an arbitrator must be appointed under Section 55 of the Punjab Cooperative Societies Act of 1961. The court labeled this objection as “frivolous,” stating there was no evidence showing the respondent was a cooperative society under the 1961 Act. Instead, it was established as a Public Charitable Trust by the Government of Punjab.
Consequently, the court determined that any arbitrator appointed by the Secretary was ineligible due to a conflict of interest under Section 12(5) of the Act of 1996. In conclusion, the court appointed Justice Tejinder Singh Dhindsa, a former judge of the Punjab & Haryana Court, as the sole arbitrator for the dispute, contingent on a declaration of his independence and impartiality under Section 12 of the Arbitration & Conciliation Act, 1996.
Representing the petitioner were Advocates Abhinav Sood and Anmol Gupta, while Sr. Advocate Dharam Vir Sharma and Advocate Pooja Yadav appeared for the respondent. The case, titled M/s Knight Frank (India) Pvt. Ltd. v. Punjab Heritage and Tourism Promotion Board, marks a significant stance against unnecessary legal hurdles in the appointment of arbitrators, reinforcing the importance of an efficient and equitable dispute resolution process.