CHENNAI METRO RAIL LIMITED ADMINISTRATIVE BUILDING versus M/S TRANSTONNELSTROY AFCONS (JV) & ANR.

Citation: [2023] 14 S.C.R. 995 · Decided: 19-10-2023 · Supreme Court of India · Bench: S. RAVINDRA BHAT · Disposal: Disposed off

Cited by 2 judgment(s) · cites 12 · see the full citation network in Lexace

Judgment (excerpt)

[2023] 14 S.C.R. 995 : 2023 INSC 932
995
CASE DETAILS
CHENNAI METRO RAIL LIMITED ADMINISTRATIVE 
BUILDING
v. 
M/S TRANSTONNELSTROY AFCONS (JV) & ANR. 
(Miscellaneous Application No.184 of 2023)
In
(Special Leave Petition (Civil) No.8553 of 2022)
With
(Civil Appeal No(s). 4591 of 2023)
OCTOBER 19, 2023 
[S. RAVINDRA BHAT AND ARAVIND KUMAR, JJ.]
HEADNOTES
Issue for consideration: Whether revision of fee by an arbitral tribunal 
would terminate the mandate of the tribunal on the ground of ineligibility 
as per s. 12 of the Arbitration and Conciliation Act, 1996.
Arbitration and Conciliation Act, 1996 – ss. 12, 13 and 14 – 
Grounds and procedure of challenge – Failure or impossibility of the 
arbitrator or tribunal to act – Arbitration proceedings between the 
parties – Tribunal revised the hearing fee for each arbitrator fi xed at 
Rs 1,00,000/- per session to Rs 2,00,000/- per session of three hours 
– Respondent paid the revised fee for fi ve hearings – Application 
u/s. 14 by the appellant challenging the mandate of the tribunal that 
the payment of the disputed increased amount by one party, caused 
prejudice to the appellant and not be treated in an impartial manner 
by the tribunal, resulting in the tribunal to become de jure unable to 
perform its functions as required – Dismissal of the application by the 
High Court – Correctness:
Held: Fixation of fee, is contractual, and wherever there is no prior 
arrangement or court order, the tribunal has to fi x it at the threshold – Fee 
increase can be resorted to only with the agreement of parties; in the event 
996 
SUPREME COURT REPORTS 
[2023] 14 S.C.R.
of disagreement by one party, the tribunal has to continue with the previous 
arrangement, or decline to act as arbitrator – By insisting that the increase 
of fee should prevail does not amount to a per se ineligibility, reaching to 
the level of voiding the tribunal’s appointment, and terminating its mandate 
– Plea of the applicant that the concept of de jure ineligibility because 
of existence of justifi able doubts about impartiality or independence of 
the tribunal on unenumerated grounds or other than those outlined as 
statutory ineligibility conditions in terms of s.12(5), cannot be sustained – 
Grounds other than those mentioned in the said schedule, occasioning an 
application in terms of s.12(3) cannot be conceived – In case, applicants 
plea is upheld, the consequences could well be an explosion in the court 
docket and other unforeseen results – Skipping the statutory route carefully 
devised by Parliament can cast yet more spells of uncertainty upon the 
arbitration process – De jure condition is not the key which unlocks the 
doors that bar challenges, mid-stream, and should “not to unlock the gates 
which shuts the court out” from what could potentially become causes of 
arbitrator challenge, during the course of arbitration proceedings, other 
than what the Act specifi cally provides for – Direction to the arbitrators 
to resume the proceedings and decide the case in accordance with law. 
[Paras 33, 34, 39 and 40]
Arbitration and Conciliation Act, 1996 – s. 12 – Grounds for 
challenge of an arbitrator – Determination of ineligibility of an 
arbitrator – Elucidated. [Paras 21-24, 28-31]
Arbitration and Conciliation Act, 1996 – Expression ‘bias’ – 
Meaning of:
Held: The Act has deliberately avoided an expression ‘bias’, instead 
the term used is justifi able doubts about the impartiality of an arbitrator, 
is an expression with many facets-subject matter bias; pecuniary bias and 
personal bias – Predisposition to decide for or against one party, without 
proper regard to the true merits of the dispute is bias – There must be 
reasonable apprehension of that predisposition. [Para 18]
LIST OF CITATIONS AND OTHER REFERENCES
ONGC v. AFCONS Gunasa JV 2022 (10) SCR 660; State of West 
Bengal vs. Shivanand Pathak (1998) 5 SCC 513: [1998] 1 SCR 811; N.K. 
997
Bajpai vs. Union of India (2012) 4 SCC 653 : [2012] 2 SCR 433; State 
of Punjab vs. Devenderpal Singh Bhuller (2011) 14 SCC 770: [2011] 15 
SCR 540; Supreme Court Advocates on record Association vs. Union of 
India (2016) 5 SCC 808: HRD Corporations v. Gas Authority of India 
Ltd. [2017] 11 SCR 857; Bharat Broadband Network Limited v. United 
Telecoms Ltd [2019] 6 SCR 97; International Airport Authority v. K.D. Bali 
& Another [1988] 3 SCR 370; G. Sarana v University of Lucknow & Ors. 
[1977] 1 SCR 64; Secretary to Government, Transport Deptt., Madras v. 
Mun

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