In Govt of NCT of Delhi vs. M/S RKMT Buildcon Pvt. Ltd., the Delhi High Court set aside an arbitral award, ruling that the unilateral appointment of a sole arbitrator by one of the contesting parties (GNCTD/PWD) was void ab initio. Justice Harish Vaidyanathan Shankar held that such an appointment violates the mandatory neutrality requirements of Section 12(5) of the Arbitration and Conciliation Act. The Court emphasized that participation in arbitral proceedings does not constitute a waiver of the right to object to an ineligible arbitrator; a valid waiver requires an express agreement in writing executed after the dispute has arisen.
- Factual Background
The Petitioner (GNCTD through PWD) and the Respondent (M/S RKMT Buildcon) entered into a 2016 agreement for the construction of school classrooms in North-West Delhi. Following the completion of works, disputes emerged regarding payments, escalation costs, and prolongation claims. On January 17, 2023, the Chief Engineer (Projects) of the PWD unilaterally appointed a Sole Arbitrator to adjudicate these disputes. The arbitrator eventually rendered an award allowing several of the Respondent’s claims.
- Legal Challenge
The Petitioner challenged the award under Section 34 of the Arbitration and Conciliation Act. Interestingly, the Petitioner (who made the appointment) argued against the legality of its own unilateral appointment mechanism, claiming it contravened the statutory mandate for independence and impartiality. The Petitioner contended that an appointment emanating solely from a designated authority of an interested party is vitiated in law.
- Arguments Regarding Waiver
The Respondent argued that the appointment was not unilateral because they had participated in the process after being shown a panel of names. They further contended that by participating in the arbitral proceedings without raising an objection, the Respondent had effectively waived any right to challenge the arbitrator’s eligibility under Section 12(5).
- Court’s Findings and Reasoning
The Court rejected the Respondent’s arguments, relying on the following legal principles:
- Mandatory Neutrality: The 2015 Amendment to the Act elevated the requirement of an independent and impartial tribunal to a binding legislative mandate.
- Unilateral Appointment Prohibited: Any mechanism that permits an interested party to unilaterally constitute an Arbitral Tribunal is proscribed, as it fails the test of manifest justice.
- Strict Requirements for Waiver: Under the proviso to Section 12(5), a waiver can only occur through an “express agreement in writing”. The Court held that this requires a conscious, informed, and unequivocal relinquishment of a statutory right.
- Conduct vs. Written Agreement: The Court clarified that waiver cannot be inferred from conduct, silence, or “tacit acceptance” during the proceedings. Mere participation in the arbitration does not elevate the status of the appointment to a valid waiver.
- Conclusion
The Court concluded that the appointment of the arbitrator by the Chief Engineer was vitiated at its inception. Because the constitution of the tribunal was contrary to the mandatory statutory framework, the resulting award lacked legitimacy and was set aside. The Court clarified that setting aside the award does not prevent the parties from pursuing other available legal remedies.
2026 DHC 5228
Govt of Nct of Delhi V. M/S Rkmt Buildcon Pvt. Ltd. (D.O.J. 01.07.2026)



