SWADESH KUMAR AGARWALversusDINESH KUMAR AGARWAL & ORS, ETC., ETC.

                          [2022] 7 S.C.R. 901                             901


                 SWADESH KUMAR AGARWAL                                    A
                                  v.
        DINESH KUMAR AGARWAL & ORS, ETC., ETC.
                (Civil Appeal Nos. 2935-2938 of 2022)
                            MAY 05, 2022                                  B

         [M. R. SHAH AND B. V. NAGARATHNA, JJ.]
       Arbitration and Conciliation Act, 1996: ss. 11(5), 11(6), 14 –
Termination of the mandate of the arbitrator – Procedure to follow
– Parties-respondent no. 1 to 3 appointed a sole arbitrator by mutual     C
consent and later revoked the mandate of the sole arbitrator –
Thereafter, the respondent no. 1 and 3 filed applications u/s. 14(1)(a)
to terminate the mandate of the sole arbitrator on the ground of
delay in concluding the arbitration proceedings – During the
pendency thereof, the appellant filed an application u/ord. 7 r. 11
for rejection of the application u/s. 14 – Trial Court dismissed the      D
appellant’s application – Thereagainst, the appellant filed writ
petition and respondent no. 1 filed an arbitration case u/s. 11(6) to
terminate the mandate of the sole arbitrator and appoint a fresh
arbitrator – High Court allowed the arbitration case and appointed
a fresh arbitration and dismissed the writ petition – On appeal,          E
held: An application u/s. 11(6) shall be maintainable only in a case
where there is a contract between the parties containing the
arbitration agreement and the appointment procedure is prescribed
and is agreed upon in writing – s.11(5) would be attracted in a case
where there is no procedure for appointment of an arbitrator agreed
                                                                          F
upon as per s.11(2) – On facts, the sole arbitrator was appointed
by the parties themselves by mutual consent and in the absence of
any written contract containing the arbitration agreement – Thus,
an application u/s.11(6) in absence of any written agreement
containing arbitration agreement was not maintainable at all –
Dispute regarding the termination of the mandate of the arbitrator        G
u/s. 14(1)(a) can be raised before the court as defined u/s.2(e) and
it cannot be decided by the High Court on an application made u/
s.11(6) – Thus, the judgement and order of the High Court is
unsustainable and is quashed and set aside – Further, an application
u/Ord.7 r.11 is decided only after considering the averments and
                                                                          H
                                 901
902            SUPREME COURT REPORTS                        [2022] 7 S.C.R.


A     allegation in the application/plaint and not the written statement/
      reply to the application/defence – Trial court rightly dismissed the
      application u/Ord.7 r.11 – Civil Procedure Code, 1908 – Ord. 7 r.
      11.
            Disposing of the appeals, the Court
B           HELD: 1.1 The sole Arbitrator was appointed by the parties
      themselves by mutual consent. There was no written agreement/
      contract containing the arbitration clause. [Para 6.1][911-G]
            1.2 Sub-section (5) of section 11 of the Arbitration and
      Conciliation Act, 1996 shall be attracted in a case where there is
C     no procedure for appointment of an arbitrator agreed upon as
      per sub-section (2) of section 11 and sub-section (6) of section 11
      shall be applicable in a case where there is a contract containing
      an arbitration agreement and the appointment procedure is
      agreed upon. Thus, while referring the matter for arbitration there
D     need not be any written contract containing any arbitration
      agreement. But the parties may themselves decide to refer the
      dispute for arbitration to the sole arbitrator by mutual consent.
      In that case or eventuality, sub-section (6) of section 11 shall not
      be attracted at all and therefore, in such a situation, the application
      under sub-section (6) of section 11 shall not be maintainable. An
E     application under sub-section (6) of section 11 shall be
      maintainable only in a case where there is a contract between the
      parties containing the arbitration agreement and the appointment
      procedure is prescribed and is agreed upon in writing. In the
      instant case, the sole arbitrator was appointed by the parties
F     themselves by mutual consent and in the absence of any written
      contract containing the arbitration agreement. Therefore,
      application under section 11(6) of the Act, 1996 in absence of any
      written agreement containing arbitration agreement was not
      maintainable at all. [Paras 6.2 & 6.3][912-C-F]
G           1.3 Except sections 13, 14 and 15, there is no other
      provision under the Act, 1996 dealing with termination of the
      mandate of the arbitrator and/or termination of the arbitral
      proceedings. Section 13 of the Act, 1996 shall be applicable only
      in a case where the arbitrator is challenged on the grounds
H
SWADESH KUMAR AGARWAL v. DINESH KUMAR AGARWAL                            903
               & ORS, ETC., ETC.

mentioned in section 12 of the Act, 1996. Sections 14 and 15             A
provide for termination of the mandate of the arbitrator. On a
conjoint reading of section 13, 14 and 15 of the Act, if the challenge
to the arbitrator is made on any of the grounds mentioned in
section 12 of the Act, the party aggrieved has to submit an
appropriate application before the Arbitral Tribunal itself.
                                                                         B
However, in case of any of the eventualities mentioned in section
14(1)(a) of the Act, 1996 and the mandate of the arbitrator is
sought to be terminated on the ground that the sole arbitrator
has become de jure and/or de facto unable to perform his functions
or for other reasons fails to act without undue delay, the aggrieved
party has to approach the concerned “court” as defined under             C
section 2(e) of the Act, 1996. The concerned court has to
adjudicate on whether, in fact, the sole arbitrator/arbitrators has/
have become de jure and de facto unable to perform his/their
functions or for other reasons he fails to act without undue delay.
The reason why such a dispute is to be raised before the court is        D
that eventualities mentioned in section 14(1)(a) can be said to be
a disqualification of the sole arbitrator and therefore, such a
dispute/controversy will have to be adjudicated before the
concerned court as provided under section 14(2) of the Act, 1996.
So far as the termination of the mandate of the arbitrator and/or
termination of the proceedings mentioned in other provisions             E
like in section 15(1)(a) where he withdraws from office for any
reason; or (b) by or pursuant to an agreement of the parties, the
dispute need not be raised before the concerned court. [Paras
6.4.1, 6.4.2, 6.5 & 6.7][919-B, F-G; 920-F-H; 921-A-C]
       1.4 Once the arbitrator was appointed by mutual consent           F
and it was alleged that the mandate of the sole arbitrator stood
terminated in view of section 14(1)(a) of the Act, 1996, the
application under section 11(6) of the Act, 1996 to terminate the
mandate of the arbitrator in view of section 14(1)(a) of the Act
shall not be maintainable. Once the appointment of the arbitrator
                                                                         G
is made, the dispute whether the mandate of the arbitrator has
been terminated on the grounds set out in section 14(1)(a) of the
Act, shall not have to be decided in an application under section
11(6) of the Act, 1996. Such a dispute cannot be decided on an
application under section 11(6) of the Act and the aggrieved party
                                                                         H
904            SUPREME COURT REPORTS                       [2022] 7 S.C.R.


A     has to approach the concerned “court” as per sub-section (2) of
      section 14 of the Act. [Para 8][922-H; 923-A-B]
            1.5 There is a difference and distinction between section
      11(5) and section 11(6) of the Act, 1996. In a case where there is
      no written agreement between the parties on the procedure for
B     appointing an arbitrator or arbitrators, parties are free to agree
      on a procedure by mutual consent and/or agreement and the
      dispute can be referred to a sole arbitrator/arbitrators who can
      be appointed by mutual consent and failing any agreement
      referred to section 11(2), section 11(5) of the Act shall be attracted
      and in such a situation, the application for appointment of arbitrator
C
      or arbitrators shall be maintainable under section 11(5) of the
      Act and not under section 11(6) of the Act. In a case where there
      is a written agreement and/or contract containing the arbitration
      agreement and the appointment or procedure is agreed upon by
      the parties, an application under section 11(6) of the Act shall be
D     maintainable and the High Court or its nominee can appoint an
      arbitrator or arbitrators in case any of the eventualities occurring
      under section 11(6) (a) to (c) of the Act. Once the dispute is
      referred to arbitration and the sole arbitrator is appointed by the
      parties by mutual consent and the arbitrator/arbitrators is/are so
E     appointed, the arbitration agreement cannot be invoked for the
      second time. In a case where there is a dispute/controversy on
      the mandate of the arbitrator being terminated on the ground
      mentioned in section 14(1)(a), such a dispute has to be raised
      before the “court”, defined under section 2(e) of the Act, 1996
      and such a dispute cannot be decided on an application filed under
F     section 11(6) of the Act, 1996. [Para 11][924-H; 925-A-F]
            1.6 It appears and it is not in dispute that the application
      under section 14(2) of the Act was sought to be rejected on the
      ground that there was no undue delay on the part of the arbitrator
      and therefore, his mandate is not required to be terminated under
G     section 14(1)(a) of the Act, 1996. However, such a dispute is to
      be adjudicated on merits by the concerned court before whom
      the proceedings under section 14(2) of the Act were initiated
      and at the most, it can be said to be the defence, which was to be
      adjudicated by the concerned court. As per the settled position
H
SWADESH KUMAR AGARWAL v. DINESH KUMAR AGARWAL                           905
               & ORS, ETC., ETC.

of law, at the stage of deciding the application under Order VII        A
Rule 11 CPC only the averments and allegations in the application/
plaint are to be considered and not the written statement and/or
reply to the application and/or the defence. Therefore, as such
the trial court rightly dismissed the application under Order VII
Rule 11 of CPC. [Para 12][925-G-H; 926-A-B]                             B
       1.7 The impugned judgment and order passed by the High
Court is unsustainable and the same is quashed and set aside.
The controversy and/or the dispute, whether the mandate of the
sole arbitrator under section 14(1)(a) of the Act, 1996 stands
terminated or not would have to be considered by the court on           C
an application filed under section 14(2) of the Act, 1996. After
the impugned order passed by the High Court, respondent Nos.
1 and 3 have withdrawn their applications under section 14(2) of
the Act, 1996. To do substantial justice between the parties and
to ensure that respondent Nos. 1 and 3 are not left remediless,
the application/applications submitted by respondent Nos. 1 and         D
3 before the concerned court under section 14(2) of the Act, 1996
would stand revived. Now the concerned court before whom, the
application/applications under section 14(2) of the Act, 1996 were
filed, would consider the same in accordance with law and on
their own merits at the earliest and preferably within the stipulated   E
period from the date of receipt of the present order. If, ultimately,
it is held that the mandate of the sole arbitrator is terminated as
per section 14(1)(a) of the Act, 1996 and more particularly on the
ground that there was undue delay on the part of the arbitrator in
concluding the arbitration proceedings, the arbitrator has to be
substituted and a fresh arbitrator has to be appointed by following     F
the same procedure which was followed earlier while appointing
the present sole arbitrator. In case the parties do not agree to
the name of the sole arbitrator, the aggrieved party may approach
the appropriate court for appointment of an arbitrator under
section 11(5) of the Act. In case application(s) under section 14(2)    G
of the Act is/are dismissed and it is held that the mandate of the
sole arbitrator is not terminated and there was no undue delay
on his part, in such a situation the sole arbitrator to conclude the
arbitration proceedings and declare the award within a period of
nine months from the decision of the court that will be taken
                                                                        H
906            SUPREME COURT REPORTS                       [2022] 7 S.C.R.


A     under section 14(2) of the Act, 1996. The impugned judgment
      and order passed by the High Court is quashed and set aside.
      [Para 13][926-C-H; 927-A-B]
            Antrix Corporation Limited v. Devas Multimedia Private
            Ltd. (2014) 11 SCC 560 : [2013] 6 SCR 453; S.P. Singla
B           Constructions Private Limited v. State of Himachal
            Pradesh and Anr. (2019) 2 SCC 488 : [2018] 14 SCR
            1005; ACC Limited v. Global Cements Limited (2012) 7
            SCC 71 : [2012] 6 SCR 215; Union of India and Ors.
            v. Uttar Pradesh State Bridge Corporation Limited
C           (2015) 2 SCC 52 : [2014] 13 SCR 1180 – referred to.
                             Case Law Reference
      [2013] 6 SCR 453                relied on               Para 3.9
      [2018] 14 SCR 1005              relied on               Para 3.9
D     [2012] 6 SCR 215                referred to             Para 4.1
      [2014] 13 SCR 1180              referred to             Para 4.1
            CIVIL APPELLATE JURISDICTION : Civil Appeal Nos.2935-
      2938 of 2022.
E           From the Judgment and Order dated 07.09.2017 of the High Court
      of Madhya Pradesh, Principal Seat at Jabalpur, Madhya Pradesh in WP
      Nos.11258 and 11259 of 2010 and AC No.29 of 2015 and Order dated
      17.11.2017 in RP No.655 of 2017.
            Divyakant Lahoti, Ms. Praveena Bisht, Parikshit Ahuja, Ms.
F     Madhur Jhavar, Ms. Vindhya Mehra, Kartik Lahoti, Advs. for the
      Appellant.
            Ashok Lalwani, Prashant Kumar, Rajesh Inamdar, Siddhant Singh,
      Aditya Bhat, Ms. Ripul Swati, Pai Amit, Sunil Singh Parihar, Ms. Charu
      Ambwani, Rameshwar Prasad Goyal, Advs. for the Respondents.
G           The Judgment of the Court was delivered by
            M. R. SHAH, J.
            1. The present appeals arise out of impugned common judgment
      and order dated 07.09.2017 passed by the High Court of Madhya Pradesh
H     Principal Seat at Jabalpur in Arbitration Case (AC) No. 29/2015 and in
SWADESH KUMAR AGARWAL v. DINESH KUMAR AGARWAL                                 907
         & ORS, ETC., ETC. [M. R. SHAH, J.]

Writ Petition Nos. 11258/2010 and 11259/2010 and the order dated              A
17.11.2017 passed in Review Petition No. 655/2017, by which, the High
Court in exercise of powers under section 11(6) of the Arbitration and
Conciliation Act, 1996 (hereinafter referred to as the Act, 1996) has
terminated the mandate of sole Arbitrator appointed by the parties
themselves and has substituted the sole Arbitrator and has appointed a
                                                                              B
fresh Arbitrator on the ground that the mandate of the sole Arbitrator
stood terminated in view of section 14(1)(a) of the Act, 1996. This is on
the basis that there was undue and unreasonable delay in proceeding
with the arbitration proceeding by the Sole Arbitrator. By the impugned
judgment and order, the High Court has also confirmed the order passed
by the learned Trial Court dismissing the application filed under Order       C
VII Rule 11 of Code of Civil Procedure (CPC) preferred by the appellant
herein.
      2. The facts leading to the present appeals in a nutshell are as
under: -
       2.1 That a dispute between the parties which as such is a family       D
dispute for partition of the properties arose. It was referred to the sole
Arbitrator. The learned Arbitrator was appointed as a sole Arbitrator by
the parties themselves on 04.08.2008. The learned Arbitrator directed
the parties to appear on 14.03.2009 for deciding the pending applications.
On the request of the parties, the Arbitrator adjourned the hearing on        E
30.03.2009. No proceedings were undertaken on 30.03.2009 due to the
fact that the sole Arbitrator was not available in town. Respondent No.
1 and 3 herein – parties to the arbitration proceedings revoked the
mandate of the sole Arbitrator vide letters dated 11.07.2009. The letters
were replied to by the sole Arbitrator. Thereafter, respondent No. 1 and
3 herein, parties to the arbitration proceedings filed applications under     F
section 14(1)(a) of the Act, 1996 before the concerned Court (District
Court) to terminate the mandate of the sole Arbitrator on the ground of
delay in concluding the arbitration proceedings. The appellant herein
filed an application under order VII Rule 11 of CPC for dismissal of the
said applications under section 14 of the Act, 1996, submitting that there    G
was no delay at all on the part of the sole Arbitrator and therefore, there
was no question of terminating the mandate of sole Arbitrator under
section 14(1)(a) of the Act, 1996. Vide order dated 15.07.2010, the learned
Trial Court dismissed the application filed under order VII Rule 11 of
CPC preferred by the appellant herein.
                                                                              H
908             SUPREME COURT REPORTS                            [2022] 7 S.C.R.


A            2.2 Feeling aggrieved by the order passed by the learned Trial
      Court, rejecting the application under order VII Rule 11 of CPC, the
      appellant herein preferred present writ petition Nos. 11259/2010 and
      11258/2010 before the High Court and pending the applications under
      section 14(1)(a) of the Act, 1996 one of the parties – Dinesh Kumar
      Agarwal preferred an arbitration case before the High Court under
B
      section 11(6) of the Act, 1996 and requested to terminate the mandate
      of the sole Arbitrator and to appoint a fresh Arbitrator. By the impugned
      judgment and order, the High Court has allowed Arbitration Case No.
      29/2015 and has observed and held that there was undue and unreasonable
      delay on the part of the sole Arbitrator in concluding the arbitrating
C     proceedings and his mandate stood terminated under section 14(1)(a) of
      the Act, 1996. Consequently, the High Court has appointed a fresh
      Arbitrator. By the impugned judgment and order, the High Court has
      also dismissed the writ petitions preferred by the appellant herein, in
      which the appellant challenged the order passed by the learned Trial
      Court rejecting the application under Order VII Rule 11 of CPC.
D
             2.3 Feeling aggrieved and dissatisfied with the impugned common
      judgment and order passed by the High Court terminating the mandate
      of sole Arbitrator under section 14(1)(a) of the Act, 1996, on an application
      filed under section 11(6) of the Act, 1996 and dismissing the writ petitions
      confirming the order passed by the learned Trial Court rejecting the
E     application under Order VII Rule 11 of CPC, the appellant has preferred
      the present appeals.
             3. Shri Divyakant Lahoti, learned counsel appearing on behalf of
      the appellant has strenuously submitted that in the facts and circumstances
      of the case the High Court has materially erred in terminating the mandate
F     of the Arbitrator under section 14(1)(a) of the Act, 1996on an application
      filed under section 11(6) of the Act, 1996.
             3.1 It is further submitted that in a case, where an Arbitrator was
      already appointed by the parties themselves, subsequently, no application
      under section 11(6) of the Act, 1996 was maintainable either to terminate
      the mandate of the sole Arbitrator and/or to substitute the Arbitrator.
G
             3.2 It is contended by Shri Lahoti, learned counsel that the mandate
      of the Arbitrator can be terminated and/or may come to an end only as
      per the provisions of the Arbitration and Conciliation Act, 1996. Reliance
      is placed upon sections13, 14, 15, 25(a), 30 and 32 of the Act, 1996. It is
      submitted that other than the aforesaid provisions under the Act, 1996,
H     there is no provision to terminate the mandate of the Arbitrator.
SWADESH KUMAR AGARWAL v. DINESH KUMAR AGARWAL                                      909
         & ORS, ETC., ETC. [M. R. SHAH, J.]

      3.3 It is submitted that in case of the eventualities mentioned in           A
section 14(1)(a) of the Act, 1996, the remedy available to the aggrieved
party would be to approach the “court” as defined under section 2(e) of
the Act, 1996.
      3.4 Shri Lahoti, learned counsel appearing on behalf of the appellant
further submitted that in the present case as such respondent No. 1 and            B
3 herein – parties to the arbitration proceedings, in fact, did submit the
applications under section 14(2) of the Act, 1996, which were pending
before the concerned court at the time when the present applications
under section 11(6) of the Act, 1996 was filed.
     3.5 It is further urged that in fact, there is a difference and distinction
                                                                                   C
between section 11(5) and section 11(6) of the Act, 1996.
       3.6 That in the absence of any written contract containing the
arbitration agreement, section 11(6) of the Act, 1996shall not be applicable
and therefore, an application under that provision shall not be maintainable.
      3.7 That even otherwise, there was no undue delay in the arbitration         D
proceedings on the part of the sole Arbitrator which could have led to
termination of his mandate that too, in exercise of powers under section
11(5) and section 11(6) of the Act, 1996.
       3.8 It is further submitted by Shri Lahoti, learned counsel appearing
on behalf of the appellant that as there was no undue delay on the part
of the sole Arbitrator therefore, section 14(1)(a) would not be attracted.         E
Therefore, application under section 14 of the Act, 1996 was liable to be
dismissed and the learned Trial Court ought to have allowed the application
filed by the appellant, to reject the application under section 14 of the
Act, 1996 in exercise of powers under Order VII Rule 11 of CPC. It is
submitted that the High Court committed a grave error in dismissing the            F
writ petitions and confirming the order passed by the learned Trial Court
in dismissing the application under Order VII Rule 11 of CPC.
      3.9 Shri Lahoti, learned counsel appearing on behalf of the appellant
heavily relied upon the decision of this Court in the case of Antrix
Corporation Limited v. Devas Multimedia Private Ltd.; (2014) 11                    G
SCC 560 (para 31 & 33) and the subsequent decision of this Court in the
case of S.P. Singla Constructions Private Limited v. State of
Himachal Pradesh and Anr.; (2019) 2 SCC 488 in support of his
submissions that once the parties have invoked the arbitration proceedings
and the Arbitrator has been appointed, subsequent application under
section 11(6) of the Act, 1996 shall not be maintainable.                          H
910             SUPREME COURT REPORTS                           [2022] 7 S.C.R.


A            4. The present appeal is vehemently opposed by Shri Ashok
      Lalwani, learned counsel appearing on behalf of respondent No.1 and
      Shri Rajesh Inamdar, learned counsel appearing on behalf of respondent
      No. 2. Shri Lalwani, learned counsel appearing on behalf of respondent
      No. 1 has vehemently submitted that in the facts and circumstances of
      the case, when it was found that there was an undue delay on the part of
B
      the Arbitrator in concluding the arbitration proceedings, his mandate was
      rightly terminated considering section 14(1)(a) of the Act, 1996.
             4.1 It is submitted that as per section 14(1) of the said Act, the
      word used is “shall”. It is submitted that it provides that the mandate of
      an arbitrator “shall” terminate and he shall be substituted by another
C     arbitrator, if he, de jure or de facto is unable to perform his functions or
      for other reasons fails to act without undue delay. It is submitted that
      therefore, once it is found that the arbitrator is unable to perform his
      functions due to eventualities mentioned in section 14(1) of the Act,
      1996, there shall be an automatic termination of the mandate of the
D     arbitrator and he shall be substituted by another arbitrator. Reliance is
      placed upon the decisions of this Court in the cases of ACC Limited v.
      Global Cements Limited; (2012) 7 SCC 71and Union of India and
      Ors. v. Uttar Pradesh State Bridge Corporation Limited; (2015) 2
      SCC 52.
             4.2 Shri Lalwani, learned counsel appearing on behalf of respondent
E     No. 1 has further submitted that in the facts and circumstances of the
      case, the learned Trial Court did not commit any error in rejecting the
      application under Order VII Rule 11 of CPC. It is urged that whether or
      not there was undue delay on the part of the sole Arbitrator is a question
      which is to be adjudicated by the Court and at the most the same can be
F     said to be a defence. That as per the settled position of law at the stage
      of deciding the application under Order VII Rule 11 of CPC only the
      averments in the application/plaint are required to be considered and not
      the defence and/or the case stated in the written statement and/or reply
      to any application. It is submitted that therefore, the learned Trial Court
      rightly rejected the application under Order VII Rule 11 of CPC and
G     rightly refused to reject the application submitted under section 14 of the
      Act, 1996. That in any case, after passing the impugned order, the original
      applicants- respondents have already withdrawn their applications under
      section 14(2) of the Act, 1996.
             4.3 Making the above submissions and relying upon the above
H     decisions, it is prayed to dismiss the present appeals.
SWADESH KUMAR AGARWAL v. DINESH KUMAR AGARWAL                                   911
         & ORS, ETC., ETC. [M. R. SHAH, J.]

      5. We have heard learned counsel appearing on behalf of the               A
respective parties at length.
      6. The following questions arise for our consideration: -
      (i)     Whether the High Court in exercise of powers under section
              11(6) of the Act, 1996, can terminate the mandate of the
              sole arbitrator?                                                  B

      (ii)    Whether in the absence of any written contract containing
              the arbitration agreement, the application under section 11(6)
              of the Act, 1996 would be maintainable?
      (iii)   Is there any difference and distinction between sub-section       C
              (5) of section 11 and sub-section (6) of section 11 of the
              Act, 1996?
      (iv)    Whether the application under sub-section (6) of section 11
              shall be maintainable in a case where the parties themselves
              appointed a sole arbitrator with mutual consent?                  D
      (v)     Whether in the facts and circumstances of the case the
              High Court was justified in terminating the mandate of the
              sole arbitrator on the ground that there was undue delay on
              the part of the sole arbitrator in concluding the arbitration
              proceedings which would lead to the termination of his
                                                                                E
              mandate, in an application under section 11(6) of the Act,
              1996?
      (vi)    Whether in the facts and circumstances of the case, the
              learned Trial Court was justified in dismissing the application
              submitted by the appellant, submitted to reject the
                                                                                F
              application under section 14(2) of the Act, 1996 in exercise
              of powers under Order VII Rule 11 of CPC?
      Question No. (i) to (v) are interconnected. Therefore, all are
considered and decided together.
       6.1 In the present case the sole Arbitrator was appointed by the         G
parties themselves by mutual consent. There was no written agreement/
contract containing the arbitration clause.
       6.2 As per sub-section (2) of section 11, subject to sub-section
(6), the parties are free to agree on a procedure for appointment of the
arbitrator or arbitrators. Sub-section (5) of section 11 provides that in an    H
912             SUPREME COURT REPORTS                            [2022] 7 S.C.R.


A     arbitration with a sole arbitrator, failing any agreement referred to in
      sub-section (2), if the parties fail to agree on the arbitrator within thirty
      days from receipt of a request by one party from the other party to so
      agree, the court may appoint an arbitrator. However, in a case where
      there is an arbitration agreement and the written contract and the
      appointment procedure is agreed upon by the parties, sub-section (6) of
B
      section 11 of the Act, 1996 shall be attracted and on the eventualities
      occurring in sub-section (6) of section 11, a party may approach the
      High Court and request for appointment of an arbitrator, in exercise of
      powers under sub-section (6) of section 11 of the Act, 1996. Therefore,
      sub-section (5) of section 11 shall be attracted in a case where there is
C     no procedure for appointment of an arbitrator agreed upon as per sub-
      section (2) of section 11 and sub-section (6) of section 11 shall be
      applicable in a case where there is a contract containing an arbitration
      agreement and the appointment procedure is agreed upon. Thus, while
      referring the matter for arbitration there need not be any written contract
D     containing any arbitration agreement. But the parties may themselves
      decide to refer the dispute for arbitration to the sole arbitrator by mutual
      consent. In that case or eventuality, sub-section (6) of section 11 shall
      not be attracted at all and therefore, in such a situation, the application
      under sub-section (6) of section 11 shall not be maintainable. An
      application under sub-section (6) of section 11 shall be maintainable only
E     in a case where there is a contract between the parties containing the
      arbitration agreement and the appointment procedure is prescribed and
      is agreed upon in writing.
             6.3 In the present case, the sole arbitrator was appointed by the
      parties themselves by mutual consent and in the absence of any written
F     contract containing the arbitration agreement. Therefore, application under
      section 11(6) of the Act, 1996 in absence of any written agreement
      containing arbitration agreement was not maintainable at all.
            6.4 Now the next question which is posed for consideration of
      this Court is, whether, in exercise of powers under sub-section (6) of
G
      section 11 of the Act, 1996, the High Court can terminate the mandate
      of the sole arbitrator and substitute the arbitrator in view of section
      14(1)(a) of the Act, 1996 on the ground that he has failed to act without
      undue delay and in such a situation aggrieved party has to approach the
      “court” to terminate his mandate.
H
SWADESH KUMAR AGARWAL v. DINESH KUMAR AGARWAL                                   913
         & ORS, ETC., ETC. [M. R. SHAH, J.]

      6.4.1 While answering the aforesaid question/issue, the relevant          A
provisions of the Act, 1996 on termination of the mandate of the arbitrator
and the procedure to be followed are required to be referred to: -
      “11. Appointment of arbitrators-(1) A person of any nationality
      may be an arbitrator, unless otherwise agreed by the parties.
      (2) Subject to sub-section (6), the parties are free to agree on a        B
      procedure for appointing the arbitrator or arbitrators.
      (3) Failing any agreement referred to in sub-section (2), in an
      arbitration with three arbitrators, each party shall appoint one
      arbitrator, and the two appointed arbitrators shall appoint the third
      arbitrator who shall act as the presiding arbitrator.                     C
      (3A) The Supreme Court and the High Court shall have the power
      to designate, arbitral institutions, from time to time, which have
      been graded by the Council under section 43-I, for the purposes
      of this Act:
                                                                                D
      Provided that in respect of those High Court jurisdictions, where
      no graded arbitral institution are available, then, the Chief Justice
      of the concerned High Court may maintain a panel of arbitrators
      for discharging the functions and duties of arbitral institution and
      any reference to the arbitrator shall be deemed to be an arbitral
      institution for the purposes of this section and the arbitrator           E
      appointed by a party shall be entitled to such fee at the rate as
      specified in the Fourth Schedule: Provided further that the Chief
      Justice of the concerned High Court may, from time to time, review
      the panel of arbitrators.]
      (4) If the appointment procedure in sub-section (3) applies and—          F
      (a) a party fails to appoint an arbitrator within thirty days from the
      receipt of a request to do so from the other party; or(b) the two
      appointed arbitrators fail to agree on the third arbitrator within
      thirty days from the date of their appointment,[the appointment
      shall be made, on an application of the party, by the arbitral
      institution designated by the Supreme Court, in case of international     G
      commercial arbitration, or by the High Court, in case of arbitrations
      other than international commercial arbitration, as the case may
      be;]
      (5) Failing any agreement referred to in sub-section (2), in an
      arbitration with a sole arbitrator, if the parties fail to agree on the   H
914      SUPREME COURT REPORTS                            [2022] 7 S.C.R.


A     arbitrator within thirty days from receipt of a request by one party
      from the other party to so agree 11[the appointment shall be made
      on an application of the party in accordance with the provisions
      contained in sub-section (4);]
      (6) Where, under an appointment procedure agreed upon by the
B     parties,- (a) a party fails to act as required under that procedure;
      or (b) the parties, or the two appointed arbitrators, fail to reach an
      agreement expected of them under that procedure; or (c) a person,
      including an institution, fails to perform any function entrusted to
      him or it under that procedure, a [the appointment shall be made,
      on an application of the party, by the arbitral institution designated
C     by the Supreme Court, in case of international commercial
      arbitration, or by the High Court, in case of arbitrations other than
      international commercial arbitration, as the case may be] to take
      the necessary measure, unless the agreement on the appointment
      procedure provides other means for securing the appointment.
D     (6B) The designation of any person or institution by the Supreme
      Court or, as the case may be, the High Court, for the purposes of
      this section shall not be regarded as a delegation of judicial power
      by the Supreme Court or the High Court.]
      (8) The arbitral institution referred to in sub-sections (4), (5) and
E     (6)], before appointing an arbitrator, shall seek a disclosure in
      writing from the prospective arbitrator in terms of sub-section (1)
      of section 12, and have due regard to— (a) any qualifications
      required for the arbitrator by the agreement of the parties; and
      (b) the contents of the disclosure and other considerations as are
      likely to secure the appointment of an independent and impartial
F     arbitrator.
      (9) In the case of appointment of sole or third arbitrator in an
      international commercial arbitration, 16[the arbitral institution
      designated by the Supreme Court] may appoint an arbitrator of a
      nationality other than the nationalities of the parties where the
G     parties belong to different nationalities.
      (11) Where more than one request has been made under sub-
      section (4) or sub-section (5) or sub-section (6) to different arbitral
      institutions, the arbitral institution to which the request has been
      first made under the relevant sub-section shall be competent to
      appoint.
H
SWADESH KUMAR AGARWAL v. DINESH KUMAR AGARWAL                                    915
         & ORS, ETC., ETC. [M. R. SHAH, J.]

    (12) Where the matter referred to in sub-sections (4), (5), (6) and          A
    (8) arise in an international commercial arbitration or any other
    arbitration, the reference to the arbitral institution in those
    subsections shall be construed as a reference to the arbitral
    institution designated under sub-section (3A).
    (13) An application made under this section for appointment of an            B
    arbitrator or arbitrators shall be disposed of by the arbitral institution
    within a period of thirty days from the date of service of notice on
    the opposite party.
    (14) The arbitral institution shall determine the fees of the arbitral
    tribunal and the manner of its payment to the arbitral tribunal subject
    to the rates specified in the Fourth Schedule.                               C
    Explanation.— For the removal of doubts, it is hereby clarified
    that this sub-section shall not apply to international commercial
    arbitration and in arbitrations (other than international commercial
    arbitration) where parties have agreed for determination of fees
    as per the rules of an arbitral institution.]                                D
    12. Grounds for challenge- (1) When a person is approached
    in connection with his possible appointment as an arbitrator, he
    shall disclose in writing any circumstances,— (a) such as the
    existence either direct or indirect, of any past or present relationship
    with or interest in any of the parties or in relation to the subject-        E
    matter in dispute, whether financial, business, professional or other
    kind, which is likely to give rise to justifiable doubts as to his
    independence or impartiality; and (b) which are likely to affect his
    ability to devote sufficient time to the arbitration and in particular
    his ability to complete the entire arbitration within a period of twelve
    months. Explanation 1.— The grounds stated in the Fifth Schedule             F
    shall guide in determining whether circumstances exist which give
    rise to justifiable doubts as to the independence or impartiality of
    an arbitrator. Explanation 2.— The disclosure shall be made by
    such person in the form specified in the Sixth Schedule.]
    (2) An arbitrator, from the time of his appointment and throughout           G
    the arbitral proceedings, shall, without delay, disclose to the parties
    in writing any circumstances referred to in sub-section (1) unless
    they have already been informed of them by him.
    (3) An arbitrator may be challenged only if- (a) circumstances
    exist that give rise to justifiable doubts as to his independence or         H
916      SUPREME COURT REPORTS                           [2022] 7 S.C.R.


A     impartiality, or (b) he does not possess the qualifications agreed to
      by the parties.
      (4) A party may challenge an arbitrator appointed by him, or in
      whose appointment he has participated, only for reasons of which
      he becomes aware after the appointment has been made.
B     [(5) Notwithstanding any prior agreement to the contrary, any
      person whose relationship, with the parties or counsel or the
      subject-matter of the dispute, falls under any of the categories
      specified in the Seventh Schedule shall be ineligible to be appointed
      as an arbitrator: Provided that parties may, subsequent to disputes
C     having arisen between them, waive the applicability of this sub-
      section by an express agreement in writing.]
      13. Challenge procedure.— (1) Subject to sub-section (4), the
      parties are free to agree on a procedure for challenging an
      arbitrator.
D     (2) Failing any agreement referred to in sub-section (1), a party
      who intends to challenge an arbitrator shall, within fifteen days
      after becoming aware of the constitution of the arbitral tribunal or
      after becoming aware of any circumstances referred to in sub-
      section (3) of section 12, send a written statement of the reasons
      for the challenge to the arbitral tribunal.
E
      (3) Unless the arbitrator challenged under sub-section (2)
      withdraws from his office or the other party agrees to the challenge,
      the arbitral tribunal shall decide on the challenge.
      (4) If a challenge under any procedure agreed upon by the parties
F     or under the procedure under sub-section (2) is not successful,
      the arbitral tribunal shall continue the arbitral proceedings and
      make an arbitral award.
      (5) Where an arbitral award is made under sub-section (4), the
      party challenging the arbitrator may make an application for setting
G     aside such an arbitral award in accordance with section 34.
      (6) Where an arbitral award is set aside on an application made
      under sub-section (5), the Court may decide as to whether the
      arbitrator who is challenged is entitled to any fees.
      14. Failure or impossibility to act.—(1) 3 [The mandate of an
H     arbitrator shall terminate and he shall be substituted by another
SWADESH KUMAR AGARWAL v. DINESH KUMAR AGARWAL                                    917
         & ORS, ETC., ETC. [M. R. SHAH, J.]

    arbitrator, if]— (a) he becomes de jure or de facto unable to                A
    perform his functions or for other reasons fails to act without
    undue delay; and (b) he withdraws from his office or the parties
    agree to the termination of his mandate.
    (2) If a controversy remains concerning any of the grounds referred
    to in clause (a) of sub-section (1), a party may, unless otherwise           B
    agreed by the parties, apply to the Court to decide on the termination
    of the mandate.
    (3) If, under this section or sub-section (3) of section 13, an arbitrator
    withdraws from his office or a party agrees to the termination of
    the mandate of an arbitrator, it shall not imply acceptance of the
    validity of any ground referred to in this section or sub-section (3)        C
    of section 12.
    15. Termination of mandate and substitution of arbitrator.—
    (1) In addition to the circumstances referred to in section 13 or
    section 14, the mandate of an arbitrator shall terminate— (a) where
    he withdraws from office for any reason; or (b) by or pursuant to            D
    agreement of the parties.
    (2) Where the mandate of an arbitrator terminates, a substitute
    arbitrator shall be appointed according to the rules that were
    applicable to the appointment of the arbitrator being replaced.
    (3) Unless otherwise agreed by the parties, where an arbitrator is           E
    replaced under sub-section (2), any hearings previously held may
    be repeated at the discretion of the arbitral tribunal.
    (4) Unless otherwise agreed by the parties, an order or ruling of
    the arbitral tribunal made prior to the replacement of an arbitrator
    under this section shall not be invalid solely because there has             F
    been a change in the composition of the arbitral tribunal.
                        xxx             xxx              xxx
    25. Default of a party.—Unless otherwise agreed by the parties,
    where, without showing sufficient cause,—
    (a) the claimant fails to communicate his statement of claim in              G
             accordance with sub-section (1) of section 23, the arbitral
             tribunal shall terminate the proceedings;
    (b) the respondent fails to communicate his statement of
             defence in accordance with sub-section (1) of section 23,
             the arbitral tribunal shall continue the proceedings without
                                                                                 H
918         SUPREME COURT REPORTS                            [2022] 7 S.C.R.


A             treating that failure in itself as an admission of the allegations
              by the claimant 3 [and shall have the discretion to treat the
              right of the respondent to file such statement of defence as
              having been forfeited].
      (c)     a party fails to appear at an oral hearing or to produce
B             documentary evidence, the arbitral tribunal may continue
              the proceedings and make the arbitral award on the evidence
              before it.
                     xxx             xxx             xxx
      30. Settlement.—(1) It is not incompatible with an arbitration
C     agreement for an arbitral tribunal to encourage settlement of the
      dispute and, with the agreement of the parties, the arbitral tribunal
      may use mediation, conciliation or other procedures at any time
      during the arbitral proceedings to encourage settlement.
      (2) If, during arbitral proceedings, the parties settle the dispute,
D     the arbitral tribunal shall terminate the proceedings and, if requested
      by the parties and not objected to by the arbitral tribunal, record
      the settlement in the form of an arbitral award on agreed terms.
      (3) An arbitral award on agreed terms shall be made in accordance
      with section 31 and shall state that it is an arbitral award.
E     (4) An arbitral award on agreed terms shall have the same status
      and effect as any other arbitral award on the substance of the
      dispute.
                     xxx             xxx             xxx
      32. Termination of proceedings.—(1) The arbitral proceedings
F     shall be terminated by the final arbitral award or by an order of
      the arbitral tribunal under sub-section (2).
      (2) The arbitral tribunal shall issue an order for the termination of
      the arbitral proceedings where—

G             (a)    the claimant withdraws his claim, unless the
                     respondent objects to the order and the arbitral tribunal
                     recognises a legitimate interest on his part in obtaining
                     a final settlement of the dispute,
              (b)    the parties agree on the termination of the
                     proceedings, or
H
SWADESH KUMAR AGARWAL v. DINESH KUMAR AGARWAL                                   919
         & ORS, ETC., ETC. [M. R. SHAH, J.]

             (c)    the arbitral tribunal finds that the continuation of the    A
                    proceedings has for any other reason become
                    unnecessary or impossible.
      (3) Subject to section 33 and sub-section (4) of section 34, the
      mandate of the arbitral tribunal shall terminate with the termination
      of the arbitral proceedings.”                                             B
      Except the aforesaid provisions, there is no other provision under
the Act, 1996 dealing with termination of the mandate of the arbitrator
and/or termination of the arbitral proceedings.
       6.4.2 Section 13 provides that subject to sub-section (4), the parties
are free to agree on a procedure for challenging an arbitrator and failing      C
any agreement on a procedure for challenging an arbitrator, a party who
intends to challenge an arbitration shall, within fifteen days after becoming
aware of the constitution of the arbitral tribunal or after becoming aware
of any circumstances referred to in sub-section (3) of section 12, send a
written statement of the reasons for the challenge to the arbitral tribunal.
                                                                                D
As per sub-section (3) of section 13, unless the arbitrator challenged
under sub-section (2) withdraws from his office or the other party agrees
to the challenge, it is for the arbitral tribunal to decide on the challenge.
If a challenge to the arbitrator is not successful in that case, the arbitral
tribunal shall continue the arbitral proceedings and make an arbitral award
and when an arbitral award is made under sub-section (4), the party             E
challenging the arbitrator may make an application for setting aside such
an arbitral award in accordance with section 34 of the Act, 1996.
Therefore, as per section 13 of the Act, the challenge to the arbitrator
shall be made before the arbitral tribunal itself.
      However, section 13 of the Act, 1996 shall be applicable only in a        F
case where the arbitrator is challenged on the grounds mentioned in
section 12 of the Act, 1996.
       6.5 Sections14 and 15 provide for termination of the mandate of
the arbitrator. Section 14 of the Act, 1996 provides that the mandate of
the arbitrator shall terminate and he shall be substituted by another
                                                                                G
arbitrator in case of any eventuality mentioned in section 14(1)(a). As
per sub-section (2) of section 14, if a controversy remains concerning
any of the grounds referred to in clause (a) of sub-section (1), a party
may, apply to the “court” to decide on the termination of the mandate.
The expression “court” is defined under section 2(e) of the Act, 1996,
which reads as under:-                                                          H
920                SUPREME COURT REPORTS                         [2022] 7 S.C.R.


A           “(e) “Court” means—
            (i)      in the case of an arbitration other than international
                     commercial arbitration, the principal Civil Court of original
                     jurisdiction in a district, and includes the High Court in
                     exercise of its ordinary original civil jurisdiction, having
B                    jurisdiction to decide the questions forming the subject-
                     matter of the arbitration if the same had been the subject-
                     matter of a suit, but does not include any Civil Court of a
                     grade inferior to such principal Civil Court, or any Court of
                     Small Causes;
C           (ii)     in the case of international commercial arbitration, the High
                     Court in exercise of its ordinary original civil jurisdiction,
                     having jurisdiction to decide the questions forming the
                     subject-matter of the arbitration if the same had been the
                     subject-matter of a suit, and in other cases, a High Court
                     having jurisdiction to hear appeals from decrees of courts
D                    subordinate to that High Court;]”
             6.6 Section 15 provides other grounds for termination of the
      mandate of the arbitrator. It provides that in addition to the circumstances
      referred to in section 13 or section 14, the mandate of an arbitrator shall
      terminate (a) where he withdraws from office for any reason; or (b) by
E     or pursuant to an agreement of the parties.
             Where the mandate of an arbitrator is terminated on the aforesaid
      grounds mentioned in section 15(1)(a) and (b) in such a situation a
      substitute arbitrator shall have to be appointed and that too, according to
      the rules that were applicable to the appointment of the arbitrator being
F     replaced.
             6.7 Therefore, on a conjoint reading of section 13, 14 and 15 of
      the Act, if the challenge to the arbitrator is made on any of the grounds
      mentioned in section 12 of the Act, the party aggrieved has to submit an
      appropriate application before the Arbitral Tribunal itself. However, in
G     case of any of the eventualities mentioned in section 14(1)(a) of the Act,
      1996 and the mandate of the arbitrator is sought to be terminated on the
      ground that the sole arbitrator has become de jure and/or de facto unable
      to perform his functions or for other reasons fails to act without undue
      delay, the aggrieved party has to approach the concerned “court” as
      defined under section 2(e) of the Act, 1996. The concerned court has to
H
SWADESH KUMAR AGARWAL v. DINESH KUMAR AGARWAL                                   921
         & ORS, ETC., ETC. [M. R. SHAH, J.]

adjudicate on whether, in fact, the sole arbitrator/arbitrators has/have        A
become de jure and de facto unable to perform his/their functions or
for other reasons he fails to act without undue delay. The reason why
such a dispute is to be raised before the court is that eventualities
mentioned in section 14(1)(a) can be said to be a disqualification of the
sole arbitrator and therefore, such a dispute/controversy will have to be
                                                                                B
adjudicated before the concerned court as provided under section 14(2)
of the Act, 1996.
       So far as the termination of the mandate of the arbitrator and/or
termination of the proceedings mentioned in other provisions like in section
15(1)(a) where he withdraws from office for any reason; or (b) by or
                                                                                C
pursuant to an agreement of the parties, the dispute need not be raised
before the concerned court. For example, where the sole arbitrator
himself withdraws from office for any reason or when both the parties
agree to terminate the mandate of the arbitrator and for substitution of
the arbitrator, thereafter, there is no further controversy as either the
sole arbitrator himself has withdrawn from office and/or the parties            D
themselves have agreed to terminate the mandate of the arbitrator and
to substitute the arbitrator. Thus, there is no question of raising such a
dispute before the court. Therefore, the legislation has deliberately
provided that the dispute with respect to the termination of the mandate
of the arbitrator under section 14(1)(a) alone will have to be raised before
                                                                                E
the “court”. Hence, whenever there is a dispute and/or controversy that
the mandate of the arbitrator is to be terminated on the grounds mentioned
in section 14(1)(a), such a controversy/dispute has to be raised before
the concerned “court” only and after the decision by the concerned
“court” as defined under section 2(e) of the Act, 1996 and ultimately it is
held that the mandate of the arbitrator is terminated, thereafter, the          F
arbitrator is to be substituted accordingly, that too, according to the rules
that were applicable to the initial appointment of the arbitrator. Therefore,
normally and generally, the same procedure is required to be followed
which was followed at the time of appointment of the sole arbitrator
whose mandate is terminated and/or who is replaced.                             G
       7. Now the next question which is posed for consideration of this
Court is, whether, in a case where the parties themselves have referred
the dispute for arbitration and appointed and/or nominated the sole
arbitrator by mutual consent and in the absence of any arbitration
agreement and contract containing an arbitration agreement once the
                                                                                H
922             SUPREME COURT REPORTS                            [2022] 7 S.C.R.


A     arbitrator is appointed, an application under section 11(6) of the Act,
      1996 to terminate the mandate of the arbitrator and to substitute the
      arbitrator would be maintainable.
             7.1 It is to be noted that in the present case as such the application
      under section 14(2) of the Act, 1996 to terminate the mandate of the
B     arbitrator was already pending before the concerned court on the ground
      that his mandate stood terminated in view of section 14(1)(a) of the Act,
      1996.
             7.2 As observed hereinabove, there is a difference and distinction
      between the arbitrator to be appointed under section 11(5) and under
C     section 11(6) of the Act, 1996. As observed above, even in the absence
      of any arbitration agreement in writing between the parties, with consent
      the parties may refer the dispute for arbitration and appoint a sole
      arbitrator/arbitrators by mutual consent and parties may agree mutually
      on a procedure for appointing an arbitrator or arbitrators even in the
      absence of any written agreement. In such a situation and failing an
D     agreement referred to sub-section (2), the aggrieved party may approach
      the High Court for appointment of an arbitrator under sub-section (5) of
      section 11 and in such a situation sub-section (5) of section 11 shall be
      attracted. However, where there is a written agreement on the
      appointment procedure agreed upon by the parties and there is a failure
E     to appoint an arbitrator or arbitrators, in that case, sub-section (6) of
      section 11 shall be attracted and an aggrieved party may approach the
      High Court for appointment of an arbitrator under sub-section (6) of
      section 11 of the Act, 1996. Therefore, an application under section 11(6)
      of the Act, 1996 shall be maintainable only in a case where there is a
      written agreement and/or the contract containing the arbitration
F     agreement and the appointment procedure agreed upon by the parties,
      application under section 11(6) of the Act, 1996 shall be maintainable.
      Otherwise, the application under section 11(6) of the Act, 1996 shall not
      be maintainable.
             7.3 In the present case, the parties themselves agreed on a
G     procedure for appointment of the arbitrator and appointed and nominated
      an arbitrator by mutual consent. Therefore, the application under section
      11(6) of the Act, 1996 was not maintainable at all.
            8. Even otherwise, once the arbitrator was appointed by mutual
      consent and it was alleged that the mandate of the sole arbitrator stood
H     terminated in view of section 14(1)(a) of the Act, 1996, the application
SWADESH KUMAR AGARWAL v. DINESH KUMAR AGARWAL                                  923
         & ORS, ETC., ETC. [M. R. SHAH, J.]

under section 11(6) of the Act, 1996 to terminate the mandate of the           A
arbitrator in view of section 14(1)(a) of the Act shall not be maintainable.
Once the appointment of the arbitrator is made, the dispute whether the
mandate of the arbitrator has been terminated on the grounds set out in
section 14(1)(a) of the Act, shall not have to be decided in an application
under section 11(6) of the Act, 1996. Such a dispute cannot be decided
                                                                               B
on an application under section 11(6) of the Act and the aggrieved party
has to approach the concerned “court” as per sub-section (2) of section
14 of the Act. In the case of Antrix Corporation Limited (supra) in
para 31 and 33, it is observed and held as under: -
      “31. The matter is not as complex as it seems and in our view,
      once the arbitration agreement had been invoked by Devas and a           C
      nominee arbitrator had also been appointed by it, the arbitration
      agreement could not have been invoked for a second time by the
      petitioner, which was fully aware of the appointment made by the
      respondent. It would lead to an anomalous state of affairs if the
      appointment of an arbitrator once made, could be questioned in a         D
      subsequent proceeding initiated by the other party also for the
      appointment of an arbitrator. In our view, while the petitioner was
      certainly entitled to challenge the appointment of the arbitrator at
      the instance of Devas, it could not do so by way of an independent
      proceeding under Section 11(6) of the 1996 Act. While power has
      been vested in the Chief Justice to appoint an arbitrator under          E
      Section 11(6) of the 1996 Act, such appointment can be questioned
      under Section 13 thereof. In a proceeding under Section 11 of the
      1996 Act, the Chief Justice cannot replace one arbitrator already
      appointed in exercise of the arbitration agreement.
      33. Sub-section (6) of Section 11 of the 1996 Act, quite                 F
      categorically provides that where the parties fail to act in terms of
      a procedure agreed upon by them, the provisions of sub-section
      (6) may be invoked by any of the parties. Where in terms of the
      agreement, the arbitration clause has already been invoked by
      one of the parties thereto under the ICC Rules, the provisions of        G
      sub-section (6) cannot be invoked again, and, in case the other
      party is dissatisfied or aggrieved by the appointment of an arbitrator
      in terms of the agreement, his/its remedy would be by way of a
      petition under Section 13, and, thereafter, under Section 34 of the
      1996 Act.”
                                                                               H
924                SUPREME COURT REPORTS                         [2022] 7 S.C.R.


A            9. Following the aforesaid decision in the subsequent decision of
      this Court in the case of S.P. Singla Constructions Private Limited
      (supra), it is observed and held by this Court that once the arbitrator had
      been appointed as per clause 65of the agreement (in that case) and as
      per provisions of the law, the arbitration agreement could not have been
      invoked for second time.
B
             9.1 Now so far as reliance being placed upon the decisions of this
      Court by learned counsel appearing on behalf of respondent No. 1 in the
      cases of ACC Limited (supra) and Uttar Pradesh State Bridge
      Corporation Limited (supra) are concerned as such there cannot be
      any dispute with respect to the position of law laid down by this Court in
C     the aforesaid decisions to the effect that in case of any of the eventualities
      occurring as mentioned in section 14 and 15 of the Act, 1996, the mandate
      of the arbitrator shall stand terminated. However, the question is in a
      case where there is a dispute/controversy on the mandate of the arbitration
      being terminated on the ground set out in section 14(1)(a) of the Act,
D     whether such a dispute shall have to be raised before the concerned
      “court” defined under section 2(e) of the Act or such a dispute can be
      considered on an application under section 11(6) of the Act? Before this
      Court in the aforesaid decisions such a controversy was not raised.
      Therefore, the aforesaid decisions shall not be of any assistance to
      respondents and/or the same shall not be applicable to the facts of the
E     case on hand, while deciding the issue, whether termination of the
      mandate of the arbitrator on the ground mentioned under section 14(1)(a)
      of the Act,1996 can be decided under section 14(2) or under section
      11(6) of the Act, 1996.
             10. It is to be noted that as such in the present case the proceedings
F     before the concerned court under section 14(2) of the Act, 1996 at the
      instance of respondent No. 1 and 3 herein to terminate the mandate of
      the sole respondent under section 14(1)(a) of the Act were already pending
      before the concerned court when respondent No. 1 moved an application
      under section 11(6) of the Act and such a dispute was at large before
G     the court in a proceeding under section 14(2) of the Act.
            11. In view of the aforesaid discussion and for the reasons stated
      above, it is observed and held as under: -
             (i)     That there is a difference and distinction between section
                     11(5) and section 11(6) of the Act, 1996;
H
SWADESH KUMAR AGARWAL v. DINESH KUMAR AGARWAL                                   925
         & ORS, ETC., ETC. [M. R. SHAH, J.]

      (ii)    In a case where there is no written agreement between the         A
              parties on the procedure for appointing an arbitrator or
              arbitrators, parties are free to agree on a procedure by
              mutual consent and/or agreement and the dispute can be
              referred to a sole arbitrator/arbitrators who can be appointed
              by mutual consent and failing any agreement referred to
                                                                                B
              section 11(2), section 11(5) of the Act shall be attracted
              and in such a situation, the application for appointment of
              arbitrator or arbitrators shall be maintainable under section
              11(5) of the Act and not under section 11(6) of the Act;
      (iii)   In a case where there is a written agreement and/or contract
                                                                                C
              containing the arbitration agreement and the appointment
              or procedure is agreed upon by the parties, an application
              under section 11(6) of the Act shall be maintainable and the
              High Court or its nominee can appoint an arbitrator or
              arbitrators in case any of the eventualities occurring under
              section 11(6) (a) to (c) of the Act;                              D
      (iv)    Once the dispute is referred to arbitration and the sole
              arbitrator is appointed by the parties by mutual consent and
              the arbitrator/arbitrators is/are so appointed, the arbitration
              agreement cannot be invoked for the second time;
      (v)     In a case where there is a dispute/controversy on the             E
              mandate of the arbitrator being terminated on the ground
              mentioned in section 14(1)(a), such a dispute has to be
              raised before the “court”, defined under section 2(e) of
              the Act, 1996 and such a dispute cannot be decided on an
              application filed under section 11(6) of the Act, 1996.           F
        12. Now the next question which is posed for consideration of
this Court is whether the learned Trial Court was justified in rejecting
the application submitted by the appellant, which was filed to reject the
applications under section 14 of the Act, in exercise of powers under
Order VII Rule 11 of CPC is concerned, having gone through the                  G
averments in the application under Order VII Rule 11 of CPC, it appears
and it is not in dispute that the application under section 14(2) of the Act
was sought to be rejected on the ground that there was no undue delay
on the part of the arbitrator and therefore, his mandate is not required to
be terminated under section 14(1)(a) of the Act, 1996. However, such a
                                                                                H
926             SUPREME COURT REPORTS                             [2022] 7 S.C.R.


A     dispute is to be adjudicated on merits by the concerned court before
      whom the proceedings under section 14(2) of the Act were initiated and
      at the most, it can be said to be the defence, which was to be adjudicated
      by the concerned court. As per the settled position of law, at the stage of
      deciding the application under Order VII Rule 11 of CPC only the
      averments and allegations in the application/plaint are to be considered
B
      and not the written statement and/or reply to the application and/or the
      defence. Therefore, as such the learned Trial Court rightly dismissed
      the application under Order VII Rule 11 of CPC.
             13. In view of the aforesaid discussion and for the reasons stated
      above, the impugned judgment and order passed by the High Court is
C     unsustainable and the same deserves to be quashed and set aside and is
      accordingly quashed and set aside. The controversy and/or the dispute,
      whether the mandate of the sole arbitrator under section 14(1)(a) of the
      Act, 1996 stands terminated or not shall have to be considered by the
      court on an application filed under section 14(2) of the Act, 1996. It is
D     reported that after the impugned order passed by the High Court,
      respondent Nos. 1 and 3 have withdrawn their applications under section
      14(2) of the Act, 1996. To do substantial justice between the parties and
      to ensure that respondent Nos. 1 and 3 are not left remediless, we direct
      that the application/applications submitted by respondent Nos. 1 and 3
      before the concerned court under section 14(2) of the Act, 1996 shall
E     stand revived. Now the concerned court before whom, the application/
      applications under section 14(2) of the Act, 1996 were filed, shall consider
      the same in accordance with law and on their own merits at the earliest
      and preferably within a period of four months from the date of receipt of
      the present order. It goes without saying, that if, ultimately, it is held that
F     the mandate of the sole arbitrator is terminated as per section 14(1)(a)
      of the Act, 1996 and more particularly on the ground that there was
      undue delay on the part of the arbitrator in concluding the arbitration
      proceedings, the arbitrator has to be substituted and a fresh arbitrator
      has to be appointed by following the same procedure which was followed
      earlier while appointing the present sole arbitrator. In case the parties do
G     not agree to the name of the sole arbitrator, the aggrieved party may
      approach the appropriate court for appointment of an arbitrator under
      section 11(5) of the Act. In case application(s) under section 14(2) of
      the Act is/are dismissed and it is held that the mandate of the sole arbitrator
      is not terminated and there was no undue delay on his part, in such a
H     situation the sole arbitrator to conclude the arbitration proceedings and
SWADESH KUMAR AGARWAL v. DINESH KUMAR AGARWAL                                  927
         & ORS, ETC., ETC. [M. R. SHAH, J.]

declare the award within a period of nine months from the decision of          A
the court that will be taken under section 14(2) of the Act, 1996. The
impugned judgment(s) and order(s) passed by the High Court in AC
No.29/2015 and in Review Petition No. 655/2017 are hereby quashed
and set aside. The appeals arising out of the aforesaid orders are hereby
accordingly Allowed. However, the appeals challenging the impugned
                                                                               B
judgment and order passed in W.P. No. 11258/2010 and W.P. No. 11259/
2010, confirming the order/orders passed by the learned Trial Court
rejecting the application under Order VII Rule 11 of CPC are hereby
dismissed. In the facts of the case, there shall be no order as to costs.

                                                                               C
Nidhi Jain                                              Appeals disposed of.
(Assisted by : Shashwat Jain, LCRA)




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