STATEMENT OF THE JURISDICTION

The Respondent humbly submits this memorandum in response to the petition filed before
this Hon’ble Court of Allahabad is being challenged. The petition invokes its appellate
jurisdiction under Section 115 of the Code of Civil Procedure. It sets forth the facts and the
laws on which the claims are based are false.

SUMMARY OF THE ARGUMENTS:

ISSUE 2: WHETHER THE APPOINTMENT OF MR. ROHIT ARORA AS AN ARBITRATOR WAS
LAWFUL?

The counsels humbly submit that the appointment of Mr. Rohit Arora, the Chief Executive
officer of STPDL is lawful and valid. Mr. Rohit Arora is the third party and competent
enough to understand the whole business as expert in this domain. Also, STPL referred his
name as he closely know both the parties and directly or indirectly deals with both the
companies or parties so know business and its impact.

It is submitted to the Hon’ble Court, that the law as stood before the 2015 Amendment of the
Act is applicable to the present case. As per Section 11 of Arbitration and Conciliation Act,
1996 is lawful to appoint such a competent Arbitrator and also written communication was
sent to VSPL regarding the same. As per Section 11 (4) (a) of Arbitration and Conciliation
Act, 1996, it is mentioned that a party fails to appoint an arbitrator within thirty days from the
receipt of a request to do so from the other party; Here VSPL had not sent any
communication back from them within 30 days. Here Party failed within 30 days and also
competent Kanpur Court as mentioned in the above section asked to go for arbitration.

ISSUE NO:2: THAT THE APPOINTMENT OF MR. ROHIT ARORA BY STPL IS

LAWFUL

The counsels humbly submit before this court that the respondent Shah Traders Private Ltd
(STPL) has a right to appoint Mr. Rohit Arora, the Chief Executive Officer of STDPL as the
sole arbitrator. In order to substantiate the contention, the counsels shall put forth the
following arguments: [2.1] That the appointment of sole arbitrator unilaterally, was made in
accordance with the terms of agreement. [2.2] That the unilateral appointment of Rohit Arora
is legally valid [2.3] That the appointed arbitrator is impartial and independent in nature.

[2.1] THE APPOINTMENT OF SOLE ARBITRATOR WAS MADE IN ACCORDANCE WITH TERMS OF
AGREEMENT.

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1. It is submitted that the dispute was agreed to be resolved by Arbitration and the procedure
agreed upon stipulates the appointment of a sole arbitrator. It is established by the facts,
that the appellant VSPL failed to appoint an arbitrator within the time limit of 30 days
when it referred the same to the court. The notice to join the arbitration proceedings was
sent to the appellant on 10.11.2012 and the period in terms of requisition was expired on
10.12.2012. It failed to provide reply within the 30 days’ time period as stipulated under
Section 11(5) of the Arbitration and Conciliation Act, 1996 (Act). Such failure of
performance on its part, made it necessary for respondent to continue with the
appointment for the effective resolution of the dispute.
2. The counsel submits that despite the respondent efforts and several notices were sent on
the address mentioned in the Agreement of VSPL, however, VSPL voluntarily did not
participate in the arbitration proceedings and now they cannot challenge the arbitral
award at the execution stage. It was stated that notices were also issued to VSPL by the
Executing Court yet they failed to appear before the said Court and now when the decree
is being executed, VSPL has malafidely filed objections under Section 47 of the Code of
Civil Procedure. It was also contended that VSPL was not interested in arbitration and
since the Agreement was already terminated nothing remained to be adjudicated as VSPL
did not wish to get the Agreement restored.1
3. It is humbly submitted, that though the agreement was terminated, such will not have any
effect on the validity of Arbitration Agreement referred as Clause 9.1. The Arbitration
proceedings does not cease to operate on termination of original contract.
4. The Principle of Separability envisages that even though the Arbitration clause exists in
the same agreement, it needs to be considered separate in nature. In National Agricultural
Co-op Marketing Federation India Ltd. v. Gains Trading Ltd 2, the Supreme Court held
that an arbitration agreement is an agreement which provides for the resolution of the
dispute and not performance of the contract; it has its own existence and will survive the
termination of the contract.

[2.2] THAT THE UNILATERAL APPOINTMENT OF ROHIT ARORA IS LEGALLY VALID:

5. The counsel humbly submits that unilateral appointment of sole arbitrator in lawful and
valid. Mr. Rohit Arora is the Chief Executive Officer of STDPL, a joint venture of STPL
and VSPL. It is submitted that Mr. Rohit Arora is the third party and competent enough to

1
Moot Proposition, ¶14
2
National Agricultural Co-op Marketing Federation India Ltd. v. Gains Trading Ltd (2007) 5 SCC 692

2
 understand the whole business as Expert in this domain. In Bhayana Builders (P) Ltd. v.
Oriental Structural Engineers (P) Ltd.3 it was held that if parties in their commercial
wisdom acquiesce to an appointment procedure which vests one of the parties to the
dispute with the sole right to nominate and/or preside as an arbitrator, such a procedure
cannot be countenanced in law as being violative of Section 12(5) of the Act.

THE 2015 AMENDMENT TO THE ARBITRATION AND CONCILIATION ACT, 1996 ARE NOT

APPLICABLE TO THE CURRENT CASE:

6. It is submitted that in wake of the recommendations of 246 th Law Commission report

which formed the cornerstone of the amendments to the Act proposed to preserve the
sanctity of the arbitral process by making it impartial, unbiased, and neutral. These
recommendations brought in the 2015 Amendments to the Act, the law made it clear that
unilateral appointments of sole arbitrators in invalid by inserting Section 11(6A), Section
12 (1) and the Fifth and Sixth Schedules. By virtue of which the law was clear, the
unilateral appointment of arbitrator carry a permanent blot of ineligibility and bias. This
blot cannot be washed away at any stage, even at execution. Thus such an award is not
legitimate and non-est in law.4
7. Later in a series of decisions (In TRF Ltd.5
Bharat Broadband Network Ltd.6, Perkins7 the Supreme Court held, that even in a case
where the Managing Director was only empowered or authorised to appoint an arbitrator,
even in such a case, because of the interest that he would be said to have in the outcome
of the result in the disputes, the element of invalidity would be directly relatable to and
arise from such an interest. Court thus reiterated the principle in the Bharat Broadband
judgment and applied it also to situations where the party had the power to appoint a sole
arbitrator. The said procedure of appointment was challenged on the ground of violation
of Section of the amended Arbitration Act in 2015, read with Seventh Schedule thereto.
The Court held that under the new provision of Section what is clear is that where under
any agreement between the parties, a person falls within any of the categories set out in
the Seventh Schedule, he is, as a matter of law, ineligible to be appointed as an arbitrator.
These three decisions make it abundantly clear that the 2015 amendments lay down a

3
Bhayana Builders (P) Ltd. v. Oriental Structural Engineers (P) Ltd. (2018) 249 DLT 619
4
Cholamandalam Investment and Finance Company Ltd v. Amrapali Enterprises and Anr 2023 SCC OnLine Cal
605
5
TRF Ltd. v. Energo Engg. Projects Ltd, (2017) 8 SCC 377
6
Bharat Broadband Network Ltd. v. United Telecoms Ltd., (2019) 5 SCC 755
7
Perkins Eastman Architects DPC v. HSCC (India) Ltd., (2020) 20 SCC 760

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 clear position that where a party has an interest in the outcome of the decision, it is not
entitled to appoint and/or to participate in any manner in the appointment of the arbitrator.
8. However, the counsel humbly submits before this court, that the 2015 post amendments
are not applicable to the current case between VSPL and STPL. The Supreme Court in
Union of India v. Parmar Construction 8 (2019) and Pradeep Vinod Construction v. Union
of India9 (2020), the Supreme Court had specifically held that where the request to refer
the dispute to arbitration was made before the 2015 Amendment Act came into effect, the
unamended A&C Act prior to 2015 shall be applicable for appointment of arbitrator.
9. It is submitted, that the Supreme Court has ruled in the case of M/s Shree Vishnu
Constructions v. The Engineer, Chief Military Engineering Service & Ors 10 that where the
notice invoking arbitration is issued prior to the coming into force of the Arbitration and
Conciliation (Amendment) Act, 2015, i.e., prior to 23.10.2015, and the application under
Section 11 of the Arbitration and Conciliation Act, 1996 (A&C Act), seeking appointment
of an arbitrator, is made post the enforcement of the Amendment Act, the 2015
Amendment Act shall not be applicable.11
10. It is submitted, the Supreme court decision in BCCI v. Kochi Cricket Private Ltd 12(2018)
where it was held that the 2015 Amendment Act is prospective in nature and will apply to
the court proceedings which have commenced on or after the 2015 Amendment Act came
into force, irrespective of whether the arbitration proceedings out of which the said court
proceedings arose commenced prior to or after the 2015 Amendment Act.
11. In light of the above submissions, the counsel throws light on the timeline of the request
for arbitration. Section 21 of the Act, states the commencement of arbitral proceedings
starts from the date of notice/request was sent, considering this, the proceedings were
commenced from 10/11/2012. The arbitral award was passed on 10.10.2013 which was
made rule of the court. The objections under Section 47 of Civil Procedure Code were
rejected on 1.10.2015 and the date of hearing this case as per the facts given the
proposition is fixed on 20.10.2015.
12. In light of this, it is to bring notice of the court, that the 2015 Amendments were brought
into effect/force from 23.10.2015. Hence, the challenge under Sec 11(6), Sec 12(1), Sec
12(5) read with Schedule 5 and Schedule 7 cannot sustain against STPL.
8
Union of India v. Parmar Construction (2019) 15 SCC 682
9
Pradeep Vinod Construction v. Union of India (2020) 2 SCC 464
10
M/s Shree Vishnu Constructions v. The Engineer, Chief Military Engineering Service & Ors (2023)
8 SCC 329
11
S.P. Singla Constructions Private Limited vs. State of Himachal Pradesh and Anr., (2019) 2 SCC 488.
12
BCCI v. Kochi Cricket Private Ltd (2018) 6 SCC 287.

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 [2.3] THAT THE APPOINTED ARBITRATOR IS IMPARTIAL AND INDEPENDENT IN NATURE.

13. The counsel humbly submits that the appointment of Mr. Rohit Arora upholds the
principles of independence and impartiality to the arbitral proceedings. As upheld in the
case of Voestalpine Schienen GmbH v. Delhi Metro Rail Corpn. Ltd 13 Independence and
impartiality are two different and concepts. An arbitrator may be independent and yet,
lack impartiality, or vice versa. Impartiality, as is well accepted, is a more subjective
concept as compared to independence. Independence, which is more an objective concept,
may thus, be more straightforwardly ascertained by the parties at the outset of the
arbitration proceedings in light of the circumstances disclosed by the arbitrator, while
partiality will more likely surface during the arbitration proceedings. Thus, whether a
unilaterally appointed arbitrator is impartial or not can be ascertained only during the
continuance of arbitral proceedings.
14. It is submitted, that the presumption of a unilaterally appointed arbitrator would always
be partial and inclined to favour the appointing party is legally unsustainable and amounts
to questioning the arbitrator's integrity. It cannot be presumed that a unilaterally appointed
arbitrator would only favour the party who has appointed it. If a unilaterally appointed
arbitrator gives equal opportunities to both parties to present their case and lay down
evidence, adheres to the principles of natural justice, and passes a reasoned arbitral award
on the basis of the material on record, terming said appointment as illegal, and void
would amount to travesty of justice.
15. It is submitted, that the principle of Kompetenz- Kompetenz should be respected by the
court. In Antrix Corpn. Ltd. v. Devas Multimedia (P) Ltd 14 clearly held that the
appointment of an arbitrator can certainly be challenged by a party, but the same must be
done taking recourse to Sections 12-15 of the Act, and the same cannot be done under
Section 11 of the Act. In fact, the Supreme Court was categorical in holding that “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. Unless the
appointment of the arbitrator is ex facie valid and such appointment satisfies the Court
exercising jurisdiction under Section 11(6) of the Arbitration Act, acceptance of such
appointment as a fait accompli to debar the jurisdiction under Section 11(6) cannot be
countenanced in law.

13
Voestalpine Schienen GmbH v. Delhi Metro Rail Corpn. Ltd., (2017) 4 SCC 665.
14
Antrix Corpn. Ltd. v. Devas Multimedia (P) Ltd 2013 (2) ARBLR 226 (SC)

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16. It is submitted before this court, that under even if the contention was considered under
Section 11 (6) of the Act, such examination of the court is limited only to the existence of
valid arbitration agreement and the Arbitral tribunal has the sole power to decide on its
own jurisdiction.
Hence, it is humbly submitted, that the appointment of Mr. Rohit Arora as the Sole
Arbitrator is legally valid.

PRAYER

In light of the issues raised, arguments advanced and authorities cited, the counsel for the
Respondent humbly prays that the Hon'ble Court of Allahabad be pleased to adjudge, hold
and declare:

1. That, the civil revision petition filed is not maintainable in the court of law.

2. That the Arbitrator appointment is as accordance to the agreement and procedure laid down
in Arbitration and Conciliation Act 1996

3. That, the Award given under the Arbitration is lawful.

4. That the Award must be executed by the VSPL to STPL

And pass any order that this Hon'ble court may deem fit in the interest of equity, justice
and good conscience.

All of which is most humbly prayed.

Sd/-

Counsels for the Respondent.