Holding

An order made by the Chief Justice of India or his nominee under Section 11(6) of the Arbitration and Conciliation Act is reviewable under Article 137, but a review petition cannot be used to grant the appointment of an arbitrator, as that would constitute a rehearing of the original case.

Summary

Mis. Jain Studios Ltd filed a review petition under Article 137 of the Constitution against an order dated 31 January 2006 in which the Chief Justice of India, acting under Section 11(6) of the Arbitration and Conciliation Act, 1996, appointed a sole arbitrator, Justice M.L. Pendse. The petitioner sought to have the order set aside and to nominate Justice Satpal as an arbitrator in accordance with the UNCITRAL model. The respondent contended that the order was a judicial, final decision under Section 11(7) and therefore not reviewable. The Supreme Court held that the order is an "order" within the meaning of Article 137 and is reviewable, but clarified that a review petition cannot be used to obtain relief that amounts to a rehearing of the original matter, such as appointing a new arbitrator after the earlier prayer was denied. Consequently, the Court granted only a limited clarification of the order and rejected the larger prayer for reconsideration and appointment of an arbitrator. No costs were awarded.

Issues considered

Whether an order passed by the Chief Justice of India or his nominee under Section 11(6) of the Arbitration and Conciliation Act, 1996 is subject to review under Article 137 of the Constitution.
Whether a review petition can be used to seek appointment of an arbitrator after such relief was previously denied in the original arbitration petition.
Whether the power of review can be exercised in this context without amounting to a rehearing of the original matter.

Legislation cited

Arbitration and Conciliation Act, 1996s. 11(6), s. 11(7)
Constitution of Indias. 137

Subjects

ArbitrationReview jurisdictionArticle 137Section 11(6) Arbitration ActAppointment of arbitratorUNCITRAL ModelJudicial orderFinal orderRehearingSupreme Court review

Judgment

MIS. JAIN STUDIOS LTD. THROUGH. ITS PRESIDENT A
v.
SHIN SATELLITE PUBLIC CO. LTD.

JULY I I, 2006

[C.K. THAKKER, J.] B

Constitution of India, 1950-Article 137-Review of Order passed in
Arbitration Petition, its restoration-Petition seeking Permission to nominate
Mr. Satpal, retired Judge ofHigh Court as one of the Arbitrators in accordance C
with UNCITRAL Model-Preliminary objection that review petition not
maintainable since the decision of Chief Justice of India or his nomir;ee under
section 11(6) appointing Mr. Pendse, retired Judge of High Court as sole
arbitrator is judicial and final-Prayer as to :1ppointment of a,.ffitrator was
made earlier and was rejected-Held: Order passed by Chief Justice of India
or his nominee under section 1 I (6) appointing sole arbitrator, is an Order D
covered by Article 13 7 and is subject to review, thus Review Petition is
maintainable-Once prayer to appoint arbitrator was refused in arbitration
petition, it cannot be sought by indirect method by filing review petition-It
is not rehearing of the original matter-Power of review is to be exercised
with extreme care, caution and circumspection and only in exceptional cases- E
Prayer for clarification of Order as to stand taken by applicant granted-
However, reconsideration of the Order and nomination of arbitrator rejected-
Arbitration and Conciliation Act, 1996-Section 11 (6).

SBP & Company v. Patel Engineering Ltd, [2005) 8 SCC 618, referred
to. F
CIVIL ORIGINAL JURISDICTION : Review Petition (Civil) (D) No.
5970 of 2006

-
(Under Article 137 of the Constitution of India).
G
IN

Arbitration Petition No. I of 2005.

K.N. Bhat, Ugra Shankar Prasad for the Petitioner.

409
H
410 SUPREME COURT REPORTS [2006] SUPP. 3 S.C.R.

A Nikhil Nayyar for the Respondent.

The Order of the Court was delivered by

C.K. THAKKER, J. The present review petition is filed against an
order dated January 31, 2006 passed in Arbitration Petition No. I of 2005, in
B Shin Satellite Public Co. ltd v. Mis Jain Studios ltd., [2006) 2 SCC 628. The
prayer is to review the said order and restore the Arbitration Petition to the
file for reconsideration. A further prayer is made to permit the applicant to
nominate Hon'ble Mr. Justice Satpal, Retd. Judge, High Court of Punjab and
Haryana as one of the arbitrators.
c Notice was issued by me on May 4, 2006 by making it returnable on
May 11, 2006. On returnable date, the parties were heard.

It is not necessary to narrate the facts in detail in the present review
petition since they had been stated in the main order. It was submitted by the
D learned counsel for the applicant that there were two obvious errors in the
order wherein it was observed as if the applicant (respondent in the Arbitration
Petition) submitted that arbitration may be held in London or in Singapore
where arbitration proceedings were going on between the parties and the
applicant had no objection if the matter was referred to arbitration in London
or in Singapore.
E
On merits, it was submitted by the learned counsel for the applicant
that the dispute between the parties under the agreement was to be finally
resolved by arbitration under the rules of UNCITRAL. Article 5 relates to
composition of arbitral tribunal and provides that if the parties had not
F previously agreed to the number of arbitrators and if within fifteen days after
the receipt by the respondent of the notice of arbitration, the parties had not
agreed that there should be only one arbitrator, three arbitrators should be
appointed. According to the applicant, Shin Satellite, through its advocate,
served a notice and called upon the applicant herein to appoint an arbitrator
but no appointment was made by the applicant. On that eventuality, submitted
G the counsel, three arbitrators ought to have been appointed. It is not disputes
that the applicant contested the matter urging that there was no legal and
valid arbitration agreement between the parties. It is also not disputed that in
the light of the objection by the applicant herein, an application was made by
Shin Satellite to the Hon'ble the Chief Justice of India for appointment of
H arbitrator under sub-section (6) of Section 11 of the Arbitration and
JAIN STUDIOS LTD. THROUGH ITS PRESIDENT''· SHIN SATELLITE PUBLIC CO.LTD [THAKKER, J] 4J J

Conciliation Act, 1996 ('Act' for short) and as a nominee of the Hon'ble the A
Chief Justice of India, by an order dated January 31, 2006, allowed the
application and appointed Hon'ble Mr. Justice M.L. Pendse, Retd. Judge as
the sole arbitrator. The counsel, however, submitted that as per UNClTRAL
A• Model, three arbitrators ought to have be~n appointed. To that extent, therefore,
the order deserves to be reviewed and an appropriate order requires to be
passed for appointment of three arbitrators.
B

The learned counsel for the respondent contested the review petition.
He raised a preliminary objection that review petition is not maintainable and
it is liable to be dismissed on that ground alone. He submitted that there is
,_
no inherent power of review in a Court or in any other authority. Such power
must be conferred expressly by a statutory pro•.·ision. It is also submitted that
c
the judgment of a larger Bench of this Court in SBP & Company v. Patel
Engineering Ltd., [2005] 8 SCC 618 makes it clear that the power exercised
by the Chief Justice of a High Court or his nominee or by the Chief Justice
of India or his nominee under sub-section (6) of Section 11 of the Act is
'judicial'. Relying on sub-section (7) of Section 11 of the Act, the counsel D
submitted that the decision of the Chief Justice or his nominee is 'final' and
no review lies against such order.

On merits; it was submitted that the applicant seeks to reagitate the
same point which was advanced at the time of hearing. A prayer was made
when the main matter was argued that the applicant may be granted time to E
make the appointment of an arbitrator but the prayer was rejected. By invoking
review jurisdiction, virtually the same prayer has been made, which was
expressly negatived earlier. The learned counsel submitted that the review is
yet another dilatory tactic adopted by the applicant who is not interested in
speedy resolution of dispute between the parties. He, therefore, submitted F
that the review application may be dismissed with costs.

So far as the maintainability of review petition is concerned, in my
opinion, the preliminary objection raised by the learned counsel for the
respondent is not well-founded. Jn Patel Engineering Ltd, this Court by
majority of 6: I held the function performed by the Chief Justice of a High G
Court or his nominee or by the Chief Justice of India or his nominee to be
~ a 'judicial' one. OnGe the function performed by the Chief Justice of India
or his nominee is held to be judicial, it cannot be contended that an application
for review of an order passed by the Chief Justice of India or his nominee
is not maintainable. In my opinion, the learned counsel for the applicant is
H
412 SUPREME COURT REPORTS [2006] SUPP. 3 S.C.R.

A right in relying upon Article 137 of the Constitution which reads thus:
137. Review ofjudgments or orders by the Supreme Court.-Subject
to the provisions of any law made by Parliament or any rules made
under article 145, the Supreme Court shall have power to review any
judgment pronounced or order made by it.
B
An order passed by the Chief Justice of India or his nominee under
Section I 1(6) of the Act is indeed an 'order' within the meaning of Article
13 7 of the Constitution and is subject to review under the aforesaid provision.

I accordingly hold the review petition to be maintainable and proceed
C to consider it on merits.
Regarding correction of errors shown by the applicant, the learned
counsel for the opponent does not dispute the position and accordingly the
submission is accepted by observing that it was not the case of the applicant
herein (respondent in the main matter), that arbitration be held in London or
D in Singapore. The mistake is ordered to be corrected accordingly.

So far as the grievanct> of the applicant on merits is concerned, the
learned counsel for the opponent is right in submitting that virtually the
applicant seeks the same relief which had been sought at the time of arguing
E the main matter and had been negatived. Once such a prayer had been refused,
no review petition would lie which would convert rehearing of the original
matter. It is settled law that the power of review cannot be confused with
appellate power which enables a superior Court to correct all errors committed
by a subordinate Court. It is not rehearing of an original matter. A repetition
of old and overruled argument is not enough to reopen concluded
F adjudications. The power of review can be exercised with extreme care,
caution and circumspection and only in exceptional cases.

When a prayer to appoint an arbitrator by the applicant herein had been
made at the time when the Arbitration Petition was heard and was rejected,
the same relief cannot be sought by an indirect method by filing a review
G petition. Such petition, in my opinion, is in the nature of 'second innings'
which is impermissible and unwarranted and cannot be granted.

For the aforesaid reasons, the limited prayer to the extent of clarification
of the order as to the stand taken by the applicant and the statement made on
H its behalf is granted. The larger prayer for reconsideration of the order passed
JAIN STUDIOS LTD. THROUGH. ITS PRESIDENT ... SHIN SATELLITE PUBLIC CO.LTD. [THAKKER J] 4 J3

in the Arbitration Petition and allowing the applicant to nominate Hon'ble A
Mr. Justice Satpal, Retd. Judge of the High Court of Punjab & Haryana as
one of the arbitrators, however, is rejected. In the facts and circumstances of
the case, however, there shall be no order as to costs.

N.J. Review Petition Rejected.
B