Punjab HC set to notify commercial arbitration rules

Parsvnath arbitrators fail to attend court despite notices

Chandigarh, August 10
The Punjab & Haryana High Court is in the process of notifying the rules on arbitration between commercial establishments. As the petition filed by the Chandigarh Housing Board alleging payment of a “huge amount of money to the arbitrators” in the Parsvnath case came up for hearing, justice Hemant Gupta made it clear the rules on arbitration have already been framed and approved by the Supreme Court. These would be notified within the next couple of days, the bench stated.
Despite court notices served to them the arbitrators failed to appear before the bench at the hearing of the case. The bench had, on the previous date of hearing, directed the notices be served through email, ‘dasti’ as well as the normal process to retired Punjab & Haryana High Court judge Amar Dutt as well as the Supreme Court’s former chief justice, GB Patnaik, and justice DP Wadhwa. This is the first time in the recallable past that three former judges, including two of the apex court, have been put on notice by the high court.
So far the three-judge arbitration tribunal, that charged the Chandigarh Housing Board up to Rs 4.5 lakh even for granting adjournments, has been asked not to hear the Parsvnath case. About Rs 80 lakh has been paid as legal fees, with the CHB alone having paid more than Rs 39 lakh.
In addition the CHB has spent close to Rs 10 lakh on travel, accommodation and other expenses for the arbitration. This amount does not include the expenses incurred by Parsvnath on the multiple sittings held in Hotel Lalit and Hotel Le Meridian in New Delhi.
Available information suggests the arbitration rules are expected to be similar to the ones framed by the Delhi High Court. In fact, the need for setting up a permanent arbitration centre in Chandigarh, on the pattern of the Delhi High Court Arbitration Centre, was being felt even since the Parsvnath controversy surfaced.
Legal experts have all along been insisting such an arbitration centre would not only result in reducing costs incurred on litigation but would also go a long way in ensuring speedy disposal of cases. As of now about 1,500 arbitration cases are still pending in the country.
The centre for speedy disposal of cases in Delhi was inaugurated by then Chief Justice of India KG Balakrishnan in November 2009.
The Delhi High Court arbitration council has been set up along the lines of the Singapore International Arbitration Centre to provide a more “cost effective” and “efficient” solution for companies, which usually have to go overseas to settle disputes. The centre functions under the aegis of the Delhi High Court and operates from within its premises. The primary objective of the initiative is to bring more transparency and reliability to arbitration and quicken the process by institutionalizing it.