{"id":355814,"date":"2025-08-06T13:00:31","date_gmt":"2025-08-06T07:30:31","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=355814"},"modified":"2025-08-12T11:07:51","modified_gmt":"2025-08-12T05:37:51","slug":"bom-hc-ruling-on-independence-and-impartiality-of-arbitrator","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2025\/08\/06\/bom-hc-ruling-on-independence-and-impartiality-of-arbitrator\/","title":{"rendered":"Read why Bombay HC dismissed petition seeking substitution of Arbitrator over independence and impartiality; highlights Arbitrator\u2019s impeccable conduct"},"content":{"rendered":"
\n

Bombay High Court:<\/span> In a petition filed under Section 14(2)<\/a> of the Arbitration and Conciliation Act, 1996<\/a> (\u2018Arbitration Act\u2019), seeking substitution of the Sole Arbitrator (\u2018the Arbitrator\u2019) on grounds of lack of independence and impartiality, Somasekhar Sundaresan, J.<\/span>, stated that the conduct of Arbitrator was impeccable , in accordance with the law while approaching the stamping authority. The Stamp Authorities ought not to have insisted upon the original instrument to be produced to engross it with the requisite stamp duty. The Court stated that it trusted the Arbitrator to carry on the adjudicatory role in all fairness and objectivity uninfluenced by the untenable grounds raised in the petition and accordingly dismissed the present petition.<\/p>\n

Background:<\/h3>\n

The arbitration proceedings arose out of a Technology Services Agreement dated 22-10-2020, which contained the arbitration clause. During the pendency of the arbitral proceedings, the issue of inadequate stamping of the agreement was raised. The Arbitrator impounded the instrument in accordance with the Maharashtra Stamp Act, 1958\u00a0authenticated a copy, and directed the Respondents to approach the Stamp Authorities for proper stamping. However, the Stamp Authorities insisted on the original instrument, leading to the Arbitrator’s visit to the stamp office for clarifying procedural requirements. The original was eventually forwarded for stamping, and subsequently returned, enabling continuation of arbitration.<\/p>\n

The petitioner alleged that the Arbitrator\u2019s engagement with the Stamp Authorities reflected bias in favour of the respondents and amounted to misconduct. Additionally, the petitioner objected to the Arbitrator\u2019s method of calculating arbitral fees by converting the claimed interest percentage into an absolute figure.<\/p>\n

Feeling aggrieved by the same, the petitioner approached the Court under Section 14(2)<\/a> of Arbitration Act<\/a>, contending that the Arbitrator had become de jure or de facto unable to perform her functions and ought to be substituted.<\/p>\n

Analysis, Law, and Decision<\/h3>\n

a. Stamp Duty Issue<\/p>\n

The Court noted that since the Stamp Authorities insisted that the original instrument be provided, the original document was forwarded by the Arbitrator with a covering letter dated 26-8-2024. This led to the Stamp Authorities eventually stamping the original instrument, thereby enabling reliance upon the instrument for further conduct of the arbitration proceedings. Examining the record, the Court opined that the Sole Arbitrator\u2019s reading of the law governing stamp duty was accurate and her conduct in this regard is impeccable. In the present case, it was for the Arbitrator to decide what was the best approach to discharging its administrative functions. If impounding is a statutory duty casted on the Arbitrator, having it stamped is also a duty cast upon the Arbitrator.<\/p>\n

The Court stated that the insistence of the Stamp Authorities on providing the original instrument was untenable. The Arbitrator was justified in being apprehensive about parting with an original instrument and had transparently disclosed all that transpired to the parties. The Arbitrator diligently took care to record the efforts taken and ensured that the record reflected why the original was being parted with. Such diligence which was impartial, fair and evidently addressed at ensuring due process was followed, could not be permitted to be twisted into an allegation of canvassing the merits of one party\u2019s case before the Stamp Authorities.<\/p>\n

The Court rejecting the ground of stamp duty issue, stated that the implication of stamping may be perceived as being adverse, but such perception would not render the impeccable conduct of the Arbitrator to be called into question and be the basis of serious insinuation against a quasi-judicial officer.<\/p>\n

b. Conversion of interest percentage into actual numbers<\/p>\n

The Court stated that there is nothing inappropriate or wrong in converting the interest rate claimed by a party into actual figures. When interest is claimed in a proceeding, the party should be ready for all consequences of the rate sought. Merely because a party claimed interest at a certain rate and did not convert it into an actual number, such claim for interest could not be left as an inchoate element. The Court stated that it is entirely for the arbitral forum to value and assess the claim and the counter claims to determine the fees, as it is totally within the scope of a legitimate exercise of quasi-judicial duty by the Arbitrator, and she must be protected by this Court.<\/p>\n

c. Conducting proceedings during pendency of stamping<\/p>\n

Regarding conduct of proceedings even while the instrument was pending with the Stamp Authorities, the Court did not find anything violative in the conduct of the Arbitrator. The Court stated that the Arbitrator fairly and transparently apprised the parties about the way the impounding and the consequential stamping was being implemented.<\/p>\n

The Court stated that if one were to accept that the Arbitrator\u2019s visit to the Stamp Authorities and the petitioner\u2019s perception of its implications gave the petitioner a right to challenge the Arbitral Tribunal\u2019s independence and impartiality, the deadline to challenge would be 15 days from such date. If the Arbitral Tribunal disagreed with the challenge to its independence and impartiality, such rejection of the challenge would put the petitioner in possession of a ground for pressing a challenge to the arbitral award under Section 34<\/a> of the Arbitration Act<\/a>. However, if that 15-day window is missed, the challenge is arguably not maintainable.<\/p>\n

d. Future conduct on stamping<\/p>\n

The Court stated that it was the wrongful insistence of the Stamp Authorities on production of the original instrument, that led to the Arbitrator having to explain her immaculate understanding of the law on stamp duty herself, in the absence of administrative support to engage with the Stamp Authorities. The Court stated that the issue of under-stamping is often weaponized in arbitral proceedings and used to trip up the adjudication of disputes by way of arbitration. Arbitrators, being private persons, tend to be timid and send the instruments to the Stamp Authorities despite being entitled to compute the stamp duty amount and penalty component themselves. The Stamp Authorities are advised to take note of this judgement and deal with future requests for stamping sent by Arbitral Tribunals in accordance with law.<\/p>\n

Further the Court directed that this judgment be forwarded to the relevant authorities to ensure proper sensitisation and compliance, in line with the Supreme Court\u2019s decision in In Re: Interplay Between Arbitration Agreement under Arbitration and Conciliation Act, 1996<\/a> and Stamp Act, 1899<\/a><\/span>, (2024) 6 SCC 1<\/a>.<\/p>\n

The Court also opined that any reasonable mind could get irritated at the least, when allegations of this nature are levelled. However, every adjudicatory mind is also aware that such interludes are par for the course when playing the role of adjudication of disputes. The Court trusted the Arbitrator to carry on the adjudicatory role in all fairness and objectivity uninfluenced by the untenable grounds raised in the Petition. Later Court by refraining imposing costs left the issue of costs for round of litigation open for consideration by Arbitral Tribunal at the stage of passing the final arbitral award, regardless of the outcome in the arbitral proceedings.<\/p>\n

[Uvik Technologies (P) Ltd. v. Nearby Technologies (P) Ltd., 2025 SCC OnLine Bom 2741<\/a>, decided on 23-7-2025<\/span>]<\/p>\n

\n

Advocates who appeared in this case:<\/p>\n

For the Petitioner:<\/span> Hasit Seth, Hrishikesh Chavan, Sharmishtha Patil and Ashish T. Suryavanshi<\/p>\n

For the Respondents:<\/span> Vikram Aditya Singh<\/p>\n

Buy Arbitration and Conciliation Act, 1996 \u00a0 HERE<\/a><\/h3>\n

\"arbitration<\/a><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

“The issue of under-stamping is often weaponized in arbitral proceedings and used to trip up the adjudication of disputes by way of arbitration. Arbitrators, being private persons, tend to be timid and send the instruments to the Stamp Authorities despite being entitled to compute the stamp duty amount and penalty component themselves.”<\/p>\n","protected":false},"author":67527,"featured_media":355826,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3,10],"tags":[40741,2569,86739,86738,72782,86740,86737],"class_list":["post-355814","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-casebriefs","category-highcourts","tag-arbitration-and-conciliation-act-1996","tag-Bombay_High_Court","tag-impeccable-conduct-of-arbitrator","tag-independence-and-impartiality-of-arbitrator","tag-justice-somasekhar-sundaresan","tag-stamping-in-arbitration-proceedings","tag-substitution-of-arbitrator"],"yoast_head":"\nBom HC ruling on independence and impartiality of arbitrator| SCC Times<\/title>\n<meta name=\"description\" content=\"Bombay High Court dismissed petition seeking substitution of arbitrator due to controversy over independence and impartiality of arbitrator; 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In the present application under Section 11(6) of the Arbitration\u2026","rel":"","context":"In "Case Briefs"","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/06\/calcutta-court.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/06\/calcutta-court.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/06\/calcutta-court.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/06\/calcutta-court.jpg?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/06\/calcutta-court.jpg?resize=1050%2C600&ssl=1 3x"},"classes":[]},{"id":291878,"url":"https:\/\/www.scconline.com\/blog\/post\/2023\/05\/12\/appointment-of-arbitrator-in-lender-borrower-agreements\/","url_meta":{"origin":355814,"position":2},"title":"Appointment of Arbitrator in Lender-Borrower Agreements","author":"Editor","date":"May 12, 2023","format":false,"excerpt":"by Mohd. Suboor\u2020","rel":"","context":"In "Op Eds"","block_context":{"text":"Op Eds","link":"https:\/\/www.scconline.com\/blog\/post\/category\/op-ed\/legal-analysis\/"},"img":{"alt_text":"arbitrator in lender-borrower agreements","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/05\/arbitrator-in-lender-borrower-agreements.webp?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/05\/arbitrator-in-lender-borrower-agreements.webp?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/05\/arbitrator-in-lender-borrower-agreements.webp?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/05\/arbitrator-in-lender-borrower-agreements.webp?resize=700%2C400&ssl=1 2x"},"classes":[]},{"id":279516,"url":"https:\/\/www.scconline.com\/blog\/post\/2022\/12\/13\/challenge-to-the-mandate-of-the-arbitrator-on-the-ground-of-bias-and-impartiality-cannot-be-raised-under-section-14-of-the-arbitration-and-conciliation-act-1996\/","url_meta":{"origin":355814,"position":3},"title":"Delhi High Court | Challenge to the mandate of the arbitrator on the ground of bias and impartiality cannot be raised under Section 14 of the Arbitration and Conciliation Act, 1996","author":"Editor","date":"December 13, 2022","format":false,"excerpt":"The Ministry of Petroleum and Natural Gas in the Union Government had instituted proceedings under Sections 14(2) read with Section 15(2) of the Arbitration and Conciliation Act, 1996 (Act) for a declaration that the majority of the members of the Arbitral Tribunal were de jure\/de facto unable to discharge their\u2026","rel":"","context":"In "Case Briefs"","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"Delhi High Court","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2022\/12\/MicrosoftTeams-image-418.jpg?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":286933,"url":"https:\/\/www.scconline.com\/blog\/post\/2023\/03\/18\/unilateral-appointment-of-arbitrator-whether-absolute-prohibition-contrary-to-the-scheme-of-the-act\/","url_meta":{"origin":355814,"position":4},"title":"Unilateral Appointment of Arbitrator \u2014 Whether Absolute Prohibition Contrary to the Scheme of the Act?","author":"Editor","date":"March 18, 2023","format":false,"excerpt":"by Prashant Tripathi\u2020 and Sanjeev Singh\u2020\u2020","rel":"","context":"In "Op Eds"","block_context":{"text":"Op Eds","link":"https:\/\/www.scconline.com\/blog\/post\/category\/op-ed\/legal-analysis\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/03\/MicrosoftTeams-image-775.png?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/03\/MicrosoftTeams-image-775.png?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/03\/MicrosoftTeams-image-775.png?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/03\/MicrosoftTeams-image-775.png?resize=700%2C400&ssl=1 2x"},"classes":[]},{"id":238252,"url":"https:\/\/www.scconline.com\/blog\/post\/2020\/10\/30\/all-hc-arbitration-act-has-been-framed-with-the-purpose-of-expeditious-disposal-of-disputes-a-disagreeing-party-can-challenge-the-arbitrators-appointment-by-raising-a-valid-ground-under-ru\/","url_meta":{"origin":355814,"position":5},"title":"All HC | Arbitration Act has been framed with the purpose of expeditious disposal of disputes; a disagreeing party can challenge arbitrator\u2019s appointment by raising a valid ground under R. 24 of Schedule-V","author":"Editor","date":"October 30, 2020","format":false,"excerpt":"Allahabad High Court: In a case revolving around the appointment of the arbitrator, Sangeeta Chandra, J., disposed of the application in respondent\u2019s favour. Counsel for the respondent, Puneet Chandra expressed his wish of not filing a response as the respondent party has no objection if this Court appoints an arbitrator.\u2026","rel":"","context":"In "Case Briefs"","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]}],"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/posts\/355814","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/users\/67527"}],"replies":[{"embeddable":true,"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/comments?post=355814"}],"version-history":[{"count":0,"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/posts\/355814\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/media\/355826"}],"wp:attachment":[{"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/media?parent=355814"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/categories?post=355814"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/tags?post=355814"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}