Inder Sain Mittal v. Housing Board, Haryana and Ors. - (Supreme Court) (21 Feb 2002)

Party partaking in arbitration waives right to object validity

MANU/SC/0117/2002

Arbitration

By participating in arbitration proceedings without protest, or objection before a court at the initial stage, a party is deemed to have waived its right to challenging validity of the proceedings and ensuing award.

In the instant case dispute arose during the construction of a house in the Respondent’s colony. An arbitrator was appointed, and while Appellant appeared before him, the Executive Engineer appearing for Respondent was absent. At subsequent hearings the Engineer failed to file written replies and delayed the matter by seeking adjournments. Due to the prolonged proceedings, before award could be passed, the arbitrator was transferred. However, he continued to arbitrate between the parties. Neither party objected to the same. At conclusion, award was granted in favour of the Appellant.

In challenge thereto, Respondent raised issues of jurisdiction. It claimed that the arbitrator, who had been transferred, did not have jurisdiction to rule on the matter. The High Court accepted the argument.

On appeal, the Supreme Court relied on precedent to record the following observations: a party may acquiesce to invalidity of conduct by participating in the [arbitral] proceedings; though the defect can be set right by the court at the initial stage, participation in proceedings without protest would preclude the objecting party from raising the objection after the award.

Thus, Respondent could no longer challenge validity of the award, having participated in the arbitration willingly.

Relevant : N. Chellappan v. Secretary, Kerala State Electricity Board and Anr. MANU/SC/0002/1974 Prasun Roy v. Calcutta Metropolitan Development Authority and Anr. MANU/SC/0017/1987 Section 30 Arbitration Act, 1940

Tags : ARBITRATION JURISDICTION ACQUIESCENCE PARTICIPATION WITHOUT PROTEST