Fee under arbitration rules comes under the judicial scanner

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Chandigarh, May 9

The arbitration fee charged by an arbitral tribunal comprising a former High Court Judge and the fee prescribed under the Chandigarh Arbitration Centre Rules, have come under the judicial scanner with the filing of a petition challenging the same.

In his petition, a doctor has sought directions for quashing an order, dated April 23, 2021, passed by the arbitral tribunal comprising Justice Ram Chand Gupta, vide which the arbitration fee was decided. Directions were also sought for quashing the Chandigarh Arbitration Centre Rules, 2018, framed by the Punjab and Haryana High Court, prescribing the fee for arbitrators.

Taking up the matter, Justice MS Ramachandra Rao and Justice Harminder Singh Madaan fixed the case for further hearing on September 2. In his petition, Amritsar-based Dr Harshbir Singh Pannu contended that a partnership agreement was entered into for establishing a super-specialty cardiac hospital with a respondent-doctor, who was formally inducted into a partnership firm. However, the partnership was dissolved and Justice Gupta was appointed the sole arbitrator, vide an order, dated March 2, 2020, passed by the High Court.

The arbitrator fixed the fee as Rs 37,50,000, to be paid by both parties in equal shares. The petitioner contented that the amount was unreasonable and unjustified as the petitioner had to pay the fee due to a counter-claim of the respondent, which was way beyond his own claim. The Bench was also told that the arbitration centre in Sector 17, Chandigarh, was charging Rs 45,000 for four sittings from both the petitioner and the respondents, making the arbitration proceeding very costly.