B.S.N.L. AND ORS. versus M/S. SUBASH CHANDRA KANCHAN AND ANR.

Citation: [2006] SUPP. 6 S.C.R. 93 · Decided: 13-09-2006 · Supreme Court of India · Bench: S.B. SINHA, DALVEER BHANDARI

Judgment (excerpt)

. .J 
B.S.N.L. AND ORS . 
A 
. v. 
MIS. SUBASH CHANDRA KANCHAN AND ANR. 
SEPTEMBER 13, 2006 
[S.B. SINHA AND DAL VEER BHANDARI, JJ.] 
B 
Arbitration and Co11ci1iation Act, 1996-,Section I I-Appointment of 
arbitrator-Disputes out of works contract-Contract contained arbitration 
clause-lnspite of notice by Respondent, Appeilant did not appoint Arbitrator C 
in terms of the arbitration clause-Respondent filed application u/S. I I on 
which High Court appointed arbitrator with consent of Appellant's Advocate--
Appointment challenged by Appellant-Held: Challenge not maintainable--
Consent of Appellant's Advocate is binding on Appellant~Appellant evidently 
waived its right under the arbitration clause by consenting to appointment 
by High Court~incelegal right was waived, enforcement thereof cannot be D 
insisted-Code of Civil Procedure, 1908-0rder. Ill, Rule I-Concession! 
consent by advocate-Effect on party. 
Certain disputes arose out of a works contract. The contract contained 
an arbitration clause in terms of which the arbitrator appointed by Managing 
Director of the Appellant was to act as the arbitral tribunal Respondent issued E 
notice to Appellant in terms of the arbitration clause. But the Managing 
Director of Appellant did not respond to the same. Consequently, Respondent · 
filed application under Sectilin 11 ·of the Arbitration and Conciliation Act, 
· · 1996 on which _the High Court appointed an arbitrator with the consent of 
Appellant's counsel. Appellant challenged the appointment but High Court F 
refused to recall the 11ppointment order. H~nce.the present appeal. 
Dismissing the appeal, the Court 
HELD: I. Although in terms of the arbitration agreell'ent contained i.n 
Clause 23 of the contract, ordinarily the arbitrator appointed by the Managing G 
Director should act as arbitral tribunal in respect of the disputes and 
differences between the parties to the contract; in this case, the Appellants 
must be held to have waived their right as they consen.ted to the appointment 
ofShri Bhattacharya as an arbitral tribunal. Apart from failure on the part 
of the Managing Director of the Appellant to appoint an arbitrator within the 
93 
H 
94 
SUPREME COURT REPORTS [2006] SUPP. 6 S.C.R. 
A specified time, the Appellants waived their right under the arbitration 
agreement The High Court having appointed the arbitral tribunal on consent, 
it is not open t~ the Appellants now to contend that no such c~ncession was 
made. f 99-C; DI 
3. Furthermore, in terms of Order Ill, Rule I CPC, a litigant is 
E represented by an advocate. A concession made by such an advocate is binding 
on the party whom he represents. If it is binding on the parties, again subject 
to just exceptions, they cannot at a later stage resile therefrom. The matter 
may, however, tie different if a concession is made on a question of law. A 
wrong concession on legal question may not be binding ·upon his client. Here, 
howeh.r, despite the stand taken by the Appellant in its written statement 
F before the High Court the Advocate consented to appointment of a person as 
an arbitrator by the High Court in exercise of its jurisdiction under Section 
I I of the I996 Act, in the considered view of this Court, the same should not 
be permitted to be resiled. from. A person may have a leg;tl right but if the 
same is waived, enforcement thereof cannot be insisted. Furthermore, it is 
G not a case where this Court should exercise its discretionary jurisdiction. 
1100-G-H; IOI-A-8; 102-CJ 
Ramdev Food Products Pvt. Ltd v. Arvindbhai Rambhai Patel and Ors., 
(2006) 8 SCALE 63I, relied on. 
H 
. CIVIL APPELLATE JURISDICTION: Civil Appeal No, 4109 of2006. 
B.S.N.L. v. SUBASH CHANDRA KANCHAN [S.B. SINHA, J.] 
95 
From the Judgment and Order dated 20.1.2006 and 3.3.2006 of the High A 
Court of Orissa at Cuttack in M.J.C.P. No. 31/2002 and M.C. No. 4/2006. 
Chetan Sharma and Somitra G. Chaudhary (for B.K. Satija) for the 
Appellants. 
Jasmshed Bey and Parmanand Gaur for the Respondents. 
The Judgment of the Court was delivered by 
S.B. SINHA, J. Leave granted. 
B 
The parties herein entered into a contract pursuant to a notice inviting C 
tender by Appellant No. I for the work of construction of 9 Nos. Type· V 
quarters at Jayadev Vihar, Bhubaneshwar. The said contract contained an 
arbitration clause in terms whereof the Chief Engineer, Telecommunication/ 
Postal Department in charge of the work at the time of dispute or if there be 
no Chief Enginee

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