ARB.P. 1212/2026 and connected matter $~23 & 24 * IN THE HIGH COURT OF DELHI AT NEW DELHI % Date of Decision: 24th September, 2026 # CNR No. DLHC010323962026 + ARB.P. 1212/2026 M/S TEWATIA CONSTRUCTION PVT LTD .....Petitioner Through: Mr. Avinash Trivedi, Mr. Anurag Kaushik and Mr. Rahul Aggarwal, Advocates. versus PUBLIC WORKS DEPARTMENT GOVT OF NCT OF DELHI .....Respondent Through: Ms. Sweety Singh, Advocate. 24 # CNR No. DLHC010327612026 + ARB.P. 1216/2026 M/S TEWATIA CONSTRUCTION PVT LTD .....Petitioner Through: Mr. Avinash Trivedi, Mr. Anurag Kaushik and Mr. Rahul Aggarwal, Advocates. versus PUBLIC WORKS DEPARTMENT GOVT OF NCT OF DELHI .....Respondent Through: Ms. Sweety Singh, Advocate. CORAM: HON'BLE MS. JUSTICE JYOTI SINGH JUDGEMENT JYOTI SINGH, J. (ORAL) I.A. 19287/2026 (Exemption) in ARB.P. 1212/2026 I.A. 19432/2026 (Exemption) in ARB.P. 1216/2026 1. Allowed, subject to all just exceptions. 2. Applications stand disposed of. Digitally Signed By:KAMAL KUMAR Signing Date:28.09.2026 16:51:03 Signature Not Verified ARB.P. 1212/2026 and connected matter ARB.P. 1212/2026 & ARB.P. 1216/2026 3. ARB.P. 1212/2026 is filed on behalf of the Petitioner under Section 11 of the Arbitration and Conciliation Act, 1996 (‘1996 Act’) for appointment of an Arbitrator. 4. The disputes, which are sought to be referred for arbitration, as pleaded in the petition, emanate from Letter of Acceptance dated 05.03.2016 in respect of work of “Construction of 177 Nos additional Class Rooms in 04 Nos. school buildings under EO Zone 14 & 16 of DDE (West-A) (Priority-1) (SH: C/o Main SPS type Buildings i/c internal & External water supply, sanitary installation and electrical installation, development of site and Fire Fighting system etc.) School of Ramesh Nagar & Patel Nagar (Package-B)”. Disputes having arisen, Petitioner wrote to the Chief Engineer of the Respondent vide letter dated 20.10.2021 to release the outstanding payments or constitute Dispute Redressal Committee (‘DRC’) for adjudication of the disputes invoking Clause 25(i) of General Conditions of Contract (‘GCC’). On 29.03.2022 Respondent convened a meeting of DRC, on receipt of reminder letter dated 21.02.2022 but the disputes remained unresolved and Petitioner sent notice invoking arbitration on 08.04.2022 calling upon the Chief Engineer to appoint a Sole Arbitrator. By letter dated 10.06.2022, Chief Engineer appointed a Sole Arbitrator, who rendered an arbitral award dated 25.10.2023, corrected by order dated 13.11.2023. Respondent challenged the award under Section 34 of 1996 Act in OMP(COMM) 111/2024 and vide judgment dated 29.04.2026, Court set aside the award on the ground that the appointment of the Arbitrator was unilateral, which led to the Petitioner sending fresh notice invoking arbitration on 14.05.2026 under Clause 25(ii) of GCC. Digitally Signed By:KAMAL KUMAR Signing Date:28.09.2026 16:51:03 Signature Not Verified ARB.P. 1212/2026 and connected matter 5. ARB.P. 1216/2026 is filed on behalf of the Petitioner under Section 11 of the 1996 Act for appointment of an Arbitrator. The disputes in this petition pertain to Letter of Acceptance dated 27.02.2016 in respect of work of “Construction of 200 additional class rooms in 08 school buildings under EO Zone 11 & 13 of DDE North West (Priority-1) (SH: C/o SPS type rooms, labs, MP halls i/c internal & external water supply, sanitary installation, development of site and Fire Fighting system etc. in SVK Ashok Vihar Phase-II, SVK Wazirpur J.J Colony, SV Wazirpur Village (Zone-II Package- A)”. Disputes having arisen, Petitioner wrote to the Chief Engineer of the Respondent vide letter dated 20.10.2021 to release the outstanding payments or constitute DRC for adjudication of the disputes invoking Clause 25 of GCC. On 28.03.2022 Respondent convened a meeting of DRC, on receipt of reminder letter dated 21.02.2022 but the disputes remained unresolved and Petitioner sent notice invoking arbitration on 08.04.2022 calling upon the Chief Engineer to appoint a Sole Arbitrator. By letter dated 22.04.2022, Chief Engineer appointed a Sole Arbitrator, who rendered an arbitral award on 14.10.2023. Respondent challenged the award under Section 34 of 1996 Act in OMP(COMM) 118/2024 and vide judgment dated 29.04.2026, Court set aside the award on the ground that the appointment of the Arbitrator was unilateral, which led to the Petitioner sending fresh notice invoking arbitration on 14.05.2026 under Clause 25(ii) of GCC. 6. Mr. Avinash Trivedi, learned counsel for the Petitioner submits that the earlier arbitration proceedings in both the petitions culminated in arbitral awards, however, both the awards were set aside by the Court on the ground that the appointments of the Arbitrators were unilateral, which led to the Petitioner invoking the arbitration agreement afresh and filing the present Digitally Signed By:KAMAL KUMAR Signing Date:28.09.2026 16:51:03 Signature Not Verified ARB.P. 1212/2026 and connected matter petitions. He submits that Clause 25 of GCC provides for appointment of the Arbitrator by the Chief Engineer, CPWD or Additional Director/Director General, CPWD and this Court has already held that this appointment is unilateral and therefore, this Court may appoint an independent Arbitrator in line with the judgments of the Supreme Court in TRF Limited v. Energo Engineering Projects Limited, (2017) 8 SCC 377; Perkins Eastman Architects DPC and Another v. HSCC (India) Limited, (2020) 20 SCC 760; and Central Organisation for Railway Electrification (CORE) v. ECI SPIC SMO MCML (JV) A Joint Venture Company, 2024 SCC OnLine SC 3219. He also submits that Co-ordinate Bench of this Court has recently in Mahavir Prasad Gupta And Sons v. Government of NCT of Delhi, ARB.P. 716/2026, decided on 11.08.2026, held that Clause 25 of GCC will be void and unenforceable in light of the judgment of the Supreme Court in Hindustan Construction Company Ltd. v. Bihar Rajya Pul Nirman Nigam Ltd. and Ors., 2025 SCC OnLine SC 2578 and appointed an independent Arbitrator. 7. Learned counsel appearing for the Respondent is unable to dispute the proposition of law that appointment of an Arbitrator under Clause 25 by the designated officers of CPWD will be a unilateral appointment and is legally impermissible in light of the judgments of the Supreme Court as also the judgment of this Court in Mahavir Prasad (Supra), where the same Clause 25 was under consideration in a petition under Section 11(6) of 1996 Act. 8. Heard learned counsels for the parties and examined their submissions. 9. There is merit in the contention of the counsel for the Petitioner that appointment of a Sole Arbitrator by the officers designated in Clause 25 of Digitally Signed By:KAMAL KUMAR Signing Date:28.09.2026 16:51:03 Signature Not Verified ARB.P. 1212/2026 and connected matter GCC will be a unilateral appointment. In Perkins (supra), the Supreme Court held that even where the Managing Director of a party to the Arbitration Agreement does not himself act as an Arbitrator but is authorised to appoint any other person of his choice or discretion, considering that he will have an interest in the outcome of the dispute, he would be disentitled to make the appointment. The Supreme Court emphasised on: (a) party autonomy; and (b) likelihood of bias of the appointing authority having interest in the outcome or result of the dispute and relevant passage is as follows:- “20. We thus have two categories of cases. The first, similar to the one dealt with in TRF Ltd. [TRF Ltd. v. Energo Engg. Projects Ltd., (2017) 8 SCC 377: (2017) 4 SCC (Civ) 72] where the Managing Director himself is named as an arbitrator with an additional power to appoint any other person as an arbitrator. In the second category, the Managing Director is not to act as an arbitrator himself but is empowered or authorised to appoint any other person of his choice or discretion as an arbitrator. If, in the first category of cases, the Managing Director was found incompetent, it was because of the interest that he would be said to be having in the outcome or result of the dispute. The element of invalidity would thus be directly relatable to and arise from the interest that he would be having in such outcome or decision. If that be the test, similar invalidity would always arise and spring even in the second category of cases. If the interest that he has in the outcome of the dispute, is taken to be the basis for the possibility of bias, it will always be present irrespective of whether the matter stands under the first or second category of cases. We are conscious that if such deduction is drawn from the decision of this Court in TRF Ltd. [TRF Ltd. v. Energo Engg. Projects Ltd., (2017) 8 SCC 377 : (2017) 4 SCC (Civ) 72] , all cases having clauses similar to that with which we are presently concerned, a party to the agreement would be disentitled to make any appointment of an arbitrator on its own and it would always be available to argue that a party or an official or an authority having interest in the dispute would be disentitled to make appointment of an arbitrator.” 10. The Supreme Court referred to the judgment in TRF Limited (Supra), where the Managing Director himself was a named Arbitrator and found him to be ineligible/incompetent on account of interest he would have in the Digitally Signed By:KAMAL KUMAR Signing Date:28.09.2026 16:51:03 Signature Not Verified ARB.P. 1212/2026 and connected matter outcome of the dispute, observing that similar invalidity would apply, where the ineligible person appoints another Arbitrator. This principle was reaffirmed by the Supreme Court in Bharat Broadband Network Limited v. United Telecoms Limited, (2019) 5 SCC 755. In Proddatur Cable TV Digi Services v. Siti Cable Network Limited, 2020 SCC OnLine Del 350, this Court held that the unilateral appointment of the arbitrator by one party to the contract does not meet the test of impartiality and independence under Section 12(5) of 1996 Act, relying on the judgment in Perkins (supra). 11. The instant case is squarely covered by the decision of this Court in Mahavir Prasad (Supra), where Court was considering a petition under Section 11 (5) and (6) of 1996 Act and same Arbitration Clause 25 of GCC, contemplating appointment of Sole Arbitrator by Chief Engineer, CPWD. Court appointed the Sole Arbitrator holding that official of a party to the dispute can neither be appointed as an Arbitrator nor appoint an Arbitrator and this portion of Clause 25 permitting the Chief Engineer to appoint the Arbitrator is void albeit it will not dent the substantive agreement between the parties to refer the disputes to arbitration. Court relied on the judgment of the Supreme Court in Hindustan Construction (Supra), where the Supreme Court held that the portion of the arbitration clause which vests exclusive appointment power in one party must be severed as void and unenforceable. Therefore, it is now authoritatively settled that unilateral appointment of Arbitrators by parties interested in the outcome of the dispute is an anathema to 1996 Act and in such cases, it is incumbent on the Court to appoint an independent and impartial Arbitrator, when approached for appointment under Section 11 (6) of 1996 Act. Digitally Signed By:KAMAL KUMAR Signing Date:28.09.2026 16:51:03 Signature Not Verified ARB.P. 1212/2026 and connected matter 12. There can be no quarrel that appointment of Arbitrators by parties to the dispute will certainly lead to a possibility of bias and as held by the Supreme Court in CORE (supra), the party appointing the Arbitrator will have control and will be in a dominating position to chart the course of action of the arbitration proceedings to the prejudice of the other party. Unilateral appointment clause is therefore inherently exclusionary and violates the principles of equal treatment of parties and procedural equality. The whole objective of taking recourse to arbitration as an alternate dispute resolution mechanism is impartial resolution of disputes between the parties and unilateral appointment clauses are in the teeth of this objective. In light of the wealth of judicial precedents on this subject, Clause 25 of GCC, to the extent it empowers the Respondent to appoint the Sole Arbitrator is void and unenforceable albeit to the extent the clause is an expression of the intent of the parties to arbitrate, it will remain enforceable and valid. 13. At this stage, counsels for the parties agree on the aspect that the disputes in the present petitions require technical qualifications and knowledge and hence the Arbitrator be appointed keeping this fact in mind. Accordingly, Mr. Rakesh Kumar Agrawal, SDG, CPWD (Mobile No.7542030167) is appointed as the Sole Arbitrator to adjudicate the disputes between the parties in both the petitions albeit these will be considered as two separate references. Arbitral proceedings will be held under the aegis of Delhi International Arbitration Centre (‘DIAC’). Fee of the Arbitrator is fixed as per fee schedule under DIAC (Administrative Costs & Arbitrators’ Fees) Rules, 2018. 14. Learned Arbitrator shall give disclosure under Section 12 of the 1996 Act before entering upon reference. Digitally Signed By:KAMAL KUMAR Signing Date:28.09.2026 16:51:03 ARB.P. 1212/2026 and connected matter 15. It is made clear that this Court has not expressed any opinion on the merits of the case and all rights and contentions of the respective parties are left open. It will be open to the Respondent to prefer a counter claim, if any, before the learned Arbitrator. 16. Petitions are disposed of in the aforesaid terms. JYOTI SINGH, J SEPTEMBER 24, 2026 S.Sharma By:KAMAL KUMAR Signing Date:28.09.2026 16:51:03