The Delhi High Court directs the Arbitrator to refund Rs.6 lakhs out of 14.5 lakhs fees paid by parties in the Arbitration Proceedings.

The Delhi High Court has directed one of the arbitrators appointed by it to refund Rs.6 lakhs as fees out of the total fees of Rs.14.5 lakhs deposited with the arbitrator by the parties to the dispute. The dispute in the said matters had arisen as per clause 3.15 of the Memorandum of Family Settlement. The petitions were heard and vide judgment dated 22nd January, 2021, and on 6th March, 2023 the disputes were referred to a Ld. Sole Arbitrator. The ld. Arbitrator entered reference on 12th February, 2021 and on 19th February, 2021 the ld. Arbitrator directed the parties to deposit Rs.5,00,000/- each.

Thereafter, the ld. Sole Arbitrator has passed some procedural orders. On 5th September, 2023, the ld. Arbitrator resigned. By the said date, the total amount which was deposited was Rs.14,50,000/-. Though, the directions were given for deposit of total of Rs.20,00,000/- by the ld. Arbitrator. The resignation was sent by the ld. Arbitrator to the High Court of Delhi directly which led to the appointment of the new Arbitrator. The said Arbitrator entered reference vide order dated 13th September, 2023. The parties, at this stage, therefore sought refund of the fee paid to the ld. Arbitrator. Ld. Counsel for the Petitioners and Respondents have made their respective submissions. The only relief they sought was for a refund of some part of the fees paid to the ld. Arbitrator.
 
The High Court held thus:

The Court has perused the various orders passed by the ld. Arbitrator. Between the period January, 2021 till February, 2022, there have been a total number of twelve hearings, out of which, three orders are substantive in nature. The issues were yet to be framed in the matter and the arbitral proceedings itself remained stayed for more than a year. At that stage, the ld. Arbitrator has resigned.
Considering this position and the amount of fee that has been paid, this Court is of the opinion that the amount that has been deposited is substantial. The parties are individual litigants and it is a suit for partition, basically seeking implementation of a memorandum of family settlement.Under these circumstances, with the consent of the parties, the fee of the ld. Arbitrator is fixed at Rs.7,50,000/-. In addition, the ld. Arbitrator may charge a sum of Rs.1,00,000/- for administrative expenses and other expenses. 

Thus, the remaining amount out of Rs.14,50,000/- is liable to be refunded to the parties. Accordingly, a sum of Rs.6,00,000/- be deposited with the worthy Registrar General within four weeks. The same would thereafter be released to both the parties i.e., Rs.3,00,000/- each to the Petitioners and Respondents. Petitions are disposed of with all pending applications, if any. Copy of this order be communicated to the ld. Arbitrator by the Registry.

Smt. Manju Gupta & Ors. Vs Shri Vilas Gupta & Ors