Summary
An agreed arbitral fee structure was not displaced by the Fourth Schedule merely because of the 2015 amendments concerning costs. On the facts, the substituted NHAI circular of 1 June 2017 governed the fees. Arbitrators who had applied the contrary Delhi High Court ruling did not thereby become legally unable to act, and termination of their mandate was set aside. The companion appeal preserved the final award already upheld by the Supreme Court.
Issues
- Whether the Fourth Schedule displaced the parties’ agreed arbitral fee structure.
- Whether following an existing High Court ruling on fees justified termination of the arbitrators’ mandate.
Held
- The contractual fee schedule based on the 2004 circular was subject to subsequent substitution; the 2017 circular, rather than the Fourth Schedule, governed fees in this case. (¶ 12)
- Merely following the then Delhi High Court ruling did not make the arbitrators de jure unable to perform their functions. Termination of their mandate on that basis was erroneous. (¶ 13–14)
- The amendments concerning costs did not directly override contracts containing an agreed fee structure. The contrary declaration in Gayatri Jhansi Roadways was incorrect. (¶ 15)
- Setting aside the impugned judgment in the companion appeal did not disturb the final award already upheld by the Supreme Court. (¶ 1 (Civil Appeal No. 5383 of 2019))
Result
Civil Appeal 5384 allowed; termination of mandate set aside and arbitrators directed to proceed expeditiously, with consensual extension of one year to deliver the award. Civil Appeal 5383 disposed of by setting aside the 11 September 2017 judgment while preserving the final award already upheld.