HC scraps ex-judge panel over high fee
NEW
DELHI: Excessive arbitration fee charged by retired judges of the
Supreme Court and high courts has prompted the Delhi high court to
dissolve one such tribunal.
The issue, which has also agitated the Supreme Court, was brought into focus by a petition filed by the health ministry.
In a recent order, Justice Vipin Sanghi disbanded an arbitration
tribunal comprising retired judges of Supreme Court and high courts that
had run up a bill of Rs 1.44 crore on the basis of a fee charged at Rs
18 lakh per hearing to resolve a dispute between the government and
three private firms.
Alarmed at the "exorbitant" fee being
demanded, the ministry pointed out that despite eight hearings, the
tribunal was yet to settle the issue of jurisdiction. The ministry said
it is neither willing nor has the means to pay such a high fee especially when in this specific case "arbitration has not even commenced."
HC agreed with the concerns voiced by the ministry through additional solicitor general Rajeeve Mehra and standing counsel Sumeet Pushkarna
and terminated the tribunal after recording mutual consent of the
Centre and the three companies. Though HC refused to comment on the fee
demanded by the retired judges who were made a party to the proceedings
by the health ministry, it indicated its view by stating in the order
that no further fee is liable to be paid to them. Till the ministry
moved court, the tribunal had already been paid Rs 47.25 lakh for their
efforts.
The parties requested the high court to appoint a sole
and independent arbitrator to decide all the disputes and differences
between them. Justice Sanghi appointed retired SC judge Justice G S
Singhvi "to adjudicate all the claims, counter-claims and disputes
between the parties". The court also clarified that the arbitration
process "shall be held entirely in accordance with the rules of Delhi International Arbitration Centre".
The case stems from a 2010 agreement signed between the health ministry
and three firms in relation to the manufacture and supply of a vaccine
to combat swine flu. The terms of the agreement specified the time limit
by when the ministry wanted delivery of the vaccines to start. However,
it alleged the companies failed to meet the deadline and demanded
return of the money paid as advance to the firms. The private players
maintained they were ready with the vaccine but the government dithered
in taking their delivery. Dispute was then referred to arbitration.
The Supreme Court too has frowned on retired judges charging exorbitant
fees in arbitration cases. In one case, it objected to parties being
forced to go to an arbitrator appointed by the court and then being
forced to agree for a fee fixed by the arbitrator.
MD NAUSHAD ALAM
PGDM 2 SEM
NEW
DELHI: Excessive arbitration fee charged by retired judges of the
Supreme Court and high courts has prompted the Delhi high court to
dissolve one such tribunal.
The issue, which has also agitated the Supreme Court, was brought into focus by a petition filed by the health ministry.
In a recent order, Justice Vipin Sanghi disbanded an arbitration tribunal comprising retired judges of Supreme Court and high courts that had run up a bill of Rs 1.44 crore on the basis of a fee charged at Rs 18 lakh per hearing to resolve a dispute between the government and three private firms.
Alarmed at the "exorbitant" fee being demanded, the ministry pointed out that despite eight hearings, the tribunal was yet to settle the issue of jurisdiction. The ministry said it is neither willing nor has the means to pay such a high fee especially when in this specific case "arbitration has not even commenced."
HC agreed with the concerns voiced by the ministry through additional solicitor general Rajeeve Mehra and standing counsel Sumeet Pushkarna and terminated the tribunal after recording mutual consent of the Centre and the three companies. Though HC refused to comment on the fee demanded by the retired judges who were made a party to the proceedings by the health ministry, it indicated its view by stating in the order that no further fee is liable to be paid to them. Till the ministry moved court, the tribunal had already been paid Rs 47.25 lakh for their efforts.
The parties requested the high court to appoint a sole and independent arbitrator to decide all the disputes and differences between them. Justice Sanghi appointed retired SC judge Justice G S Singhvi "to adjudicate all the claims, counter-claims and disputes between the parties". The court also clarified that the arbitration process "shall be held entirely in accordance with the rules of Delhi International Arbitration Centre".
The case stems from a 2010 agreement signed between the health ministry and three firms in relation to the manufacture and supply of a vaccine to combat swine flu. The terms of the agreement specified the time limit by when the ministry wanted delivery of the vaccines to start. However, it alleged the companies failed to meet the deadline and demanded return of the money paid as advance to the firms. The private players maintained they were ready with the vaccine but the government dithered in taking their delivery. Dispute was then referred to arbitration.
The Supreme Court too has frowned on retired judges charging exorbitant fees in arbitration cases. In one case, it objected to parties being forced to go to an arbitrator appointed by the court and then being forced to agree for a fee fixed by the arbitrator.
The issue, which has also agitated the Supreme Court, was brought into focus by a petition filed by the health ministry.
In a recent order, Justice Vipin Sanghi disbanded an arbitration tribunal comprising retired judges of Supreme Court and high courts that had run up a bill of Rs 1.44 crore on the basis of a fee charged at Rs 18 lakh per hearing to resolve a dispute between the government and three private firms.
Alarmed at the "exorbitant" fee being demanded, the ministry pointed out that despite eight hearings, the tribunal was yet to settle the issue of jurisdiction. The ministry said it is neither willing nor has the means to pay such a high fee especially when in this specific case "arbitration has not even commenced."
HC agreed with the concerns voiced by the ministry through additional solicitor general Rajeeve Mehra and standing counsel Sumeet Pushkarna and terminated the tribunal after recording mutual consent of the Centre and the three companies. Though HC refused to comment on the fee demanded by the retired judges who were made a party to the proceedings by the health ministry, it indicated its view by stating in the order that no further fee is liable to be paid to them. Till the ministry moved court, the tribunal had already been paid Rs 47.25 lakh for their efforts.
The parties requested the high court to appoint a sole and independent arbitrator to decide all the disputes and differences between them. Justice Sanghi appointed retired SC judge Justice G S Singhvi "to adjudicate all the claims, counter-claims and disputes between the parties". The court also clarified that the arbitration process "shall be held entirely in accordance with the rules of Delhi International Arbitration Centre".
The case stems from a 2010 agreement signed between the health ministry and three firms in relation to the manufacture and supply of a vaccine to combat swine flu. The terms of the agreement specified the time limit by when the ministry wanted delivery of the vaccines to start. However, it alleged the companies failed to meet the deadline and demanded return of the money paid as advance to the firms. The private players maintained they were ready with the vaccine but the government dithered in taking their delivery. Dispute was then referred to arbitration.
The Supreme Court too has frowned on retired judges charging exorbitant fees in arbitration cases. In one case, it objected to parties being forced to go to an arbitrator appointed by the court and then being forced to agree for a fee fixed by the arbitrator.
MD NAUSHAD ALAM
PGDM 2 SEM
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