M/S Intec Capital Ltd vs M/S. Allied Engineering Solution & Ors on 19 May, 2023

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Delhi High Court - Orders

M/S Intec Capital Ltd vs M/S. Allied Engineering Solution & Ors on 19 May, 2023

Bench: Prateek Jalan

                                          $~35
                                          *    IN THE HIGH COURT OF DELHI AT NEW DELHI

                                          +           ARB.P. 555/2023
                                                      M/S INTEC CAPITAL LTD                   ..... Petitioner
                                                                      Through:
                                                                        Mr. Pranav Goyal & Ms. Pooja
                                                                        Chaudhary, Advocates. [M:-
                                                                        9871169411]
                                                                    versus
                                              M/S. ALLIED ENGINEERING
                                              SOLUTION & ORS.                            ..... Respondents
                                                            Through: Mr. Raj Gaurav, Advocate.
                                          CORAM:
                                          HON'BLE MR. JUSTICE PRATEEK JALAN
                                                            ORDER

                                          %                 19.05.2023

                                          I.A. 9822/2023(exemption)

Exemption allowed, subject to all just exceptions. The application stands disposed of.

ARB.P. 555/2023

1. Issue notice. Mr. Raj Gaurav, learned counsel, appears on advance notice, and accepts notice on behalf of the respondents. With the consent of learned counsel for the parties, the petition is taken up for disposal.

2. By way of this petition under Section 11 of the Arbitration and Conciliation Act, 1996 ["the Act"], the petitioner seeks appointment of an arbitrator to adjudicate disputes between the parties under a loan agreement dated 31.12.2013 ["the loan agreement"], by which the petitioner gave an amount of ₹81 lakhs on loan to the respondents. The loan agreement contains an arbitration clause [Clause 19] which provides for adjudication of disputes by a sole arbitrator to be appointed by the ARB.P. 555/2023 Page 1 of 3 This is a digitally signed order.

The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 24/09/2023 at 16:34:38 petitioner. The seat of the arbitration has been fixed as New Delhi. In view of the fact that unilateral appointment of an arbitrator by one of the parties is impermissible under the judgments of the Supreme Court in TRF Limited vs. Energo Engineering Projects Limited (2017) 8 SCC 377 and Perkins Eastman Architects DPC and another vs. HSCC (India) Limited (2020) 20 SCC 760, the petitioner has approached this Court seeking appointment of an arbitrator.

3. Disputes having arisen between the parties, arbitration proceedings were initiated by the petitioner which culminated in an award dated 14.08.2015. The respondents herein challenged the said award under Section 34 of the Act before the Additional District Judge-03, North- West District, Rohini Courts, Delhi [Arb No. 57684/16]. The said objection petition has been disposed of vide a judgment dated 20.02.2023, setting aside the award dated 14.08.2015.

4. In these circumstances, the petitioner has issued a legal notice dated 03.04.2023, purporting to invoke the arbitration clause afresh. By a reply through counsel dated 15.04.2023, the respondents have submitted that no amount is due to the petitioner. It is also suggested therein that the petitioner's claims already stand finally adjudicated in the prior round of proceedings.

5. Mr. Gaurav, however, submits that since the arbitration clause and invocation thereof is undisputed, an arbitrator can be appointed, leaving questions of maintainability of the claims/counter-claims and a decision on merits open for adjudication by the learned arbitrator. Learned counsel for the parties submit that the arbitration may be held under the aegis of Delhi International Arbitration Centre, Shershah Road, Delhi-110503 ARB.P. 555/2023 Page 2 of 3 This is a digitally signed order.

6. Mr. Pranav Goyal, learned counsel for the petitioner, states that the petitioner's claims are now in the region of ₹10 crores and Mr. Gaurav states that the respondents also have counter claims of about ₹48 crores.

7. Having regard to the aforesaid submission, and with the consent of learned counsel for the parties, the petition is disposed of with the following directions:-

a. The disputes between the parties under the loan agreement dated 31.12.2013 are referred to the arbitration of Hon'ble Ms. Justice Gita Mittal, former Chief Justice, High Court of Jammu & Kashmir and Ladakh [Tel: 9818000220; email:

[email protected]].

b. The arbitration will be held under the aegis of DIAC, and will be subject to the Rules of DIAC, including as to the remuneration of the learned Arbitrator.

c. The learned Arbitrator is requested to furnish a declaration in terms of Section 12 of the Act, prior to entering upon the reference. d. It is made clear that all claims and counter claims of the parties may be agitated before the learned Arbitrator, and that the parties are free to raise their contentions on maintainability and arbitrability of the claims as well as on the merits before the learned Arbitrator.

8. The petition is disposed of with these directions.

PRATEEK JALAN, J MAY 19, 2023/'pv'/ ARB.P. 555/2023 Page 3 of 3 This is a digitally signed order.

The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 24/09/2023 at 16:34:39

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Delhi High Court - Orders