SC adjourns to Sep 13 hearing on whether person ineligible to be arbitrator can nominate another as one

New Delhi, Jul 12 (PTI) The Supreme Court on Wednesday adjourned for two months to September 13 the hearing on the legal question whether a person who is ineligible to be an arbitrator can nominate another person as arbitrator.

A five-judge constitution bench headed by Chief Justice D Y Chandrachud took note of the submission by Attorney General R Venkataramani that an expert committee has been set up by the Centre to go into the functioning of the arbitration law in the country and recommend reforms in the Arbitration and Conciliation Act.

“The Attorney General submits that the issues which have been raised before constitution bench will undoubtedly also come within the remit of the committee. After report of the committee, the government would take a considered view if the modification of legislation is warranted…

“Hence, presently, we direct that the references before the Constitution bench be deferred by a period of two months. The court shall be apprised on the next date of the progress which has been made following the constitution of the committee. List on September 13, 2023,” the bench, also comprising Justices Hrishikesh Roy, P S Narasimha, Pankaj Mithal, and Justice Manoj Misra, said.

Two references were made by three-judge apex court benches in 2021 for constitution of a larger bench to consider the issue.

The apex court had in 2017 and 2020 held that a person not eligible to become an arbitrator cannot nominate another person as arbitrator. However, in another matter in 2020, the Supreme Court had allowed the appointment made by a person who was ineligible to become an arbitrator.

At the outset, Venkataramani said the matter may be adjourned as the Union government has set up an expert committee on June 14 to recommend reforms in the Arbitration and Conciliation Act.

“The matter can be deferred for a while till the committee gives its report. It’s a consultative process,” the AG said.

Senior advocate Fali S Nariman, appearing for one of the parties, said deferment of the hearing will be preferable as reference by the government is on a new law to be enacted.

Amid a push for making India a hub for international arbitration, the government has set up an expert panel led by former law secretary T K Vishwanathan to recommend reforms in the Arbitration and Conciliation Act in order to reduce the burden on courts.

Venkataramani is also part of the expert panel set up by the Department of Legal Affairs in the Union law ministry.

Law ministry additional secretary Rajiv Mani, some senior advocates, representatives of private law firms, and officials of the Legislative Department, Niti Aayog, National Highways Authority of India (NHAI), railways and Central Public Works Department (CPWD) are its other members.

The top court was hearing the legal issue whether a person who is ineligible to be an arbitrator can nominate another person as arbitrator.

The CJI had on June 26 formed a five-judge constitution bench to examine it.