Supreme Court - Daily Orders
Eurobearings India Pvt. Ltd. vs Eurobearings R.I. on 1 February, 2021
Bench: Chief Justice, A.S. Bopanna, V. Ramasubramanian
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ITEM NO.6 Court No.1 (Video Conferencing) SECTION XVI-A
S U P R E M E C O U R T O F I N D I A
RECORD OF PROCEEDINGS
Arbitration Petition (Civil) No(s).4/2021
EUROBEARINGS INDIA PVT. LTD. Petitioner(s)
VERSUS
EUROBEARINGS R.I. Respondent(s)
(FOR ADMISSION)
WITH Arbitration Petition (Civil) No.5/2021 (XVI-A)
(FOR ADMISSION and I.R.)
Date : 01-02-2021 These petitions were called on for hearing today.
CORAM :
HON'BLE THE CHIEF JUSTICE
HON'BLE MR. JUSTICE A.S. BOPANNA
HON'BLE MR. JUSTICE V. RAMASUBRAMANIAN
For Petitioner(s) Mr. Ritin Rai, Sr. Adv.
Mr. Sameer Abhyankar, AOR
Mr. Amish Tandon, Adv;
Mr. Ayush Beotra, Adv.
Mr. Varun Tandon, Adv.
Mr. Dipin Tamang, Adv.
For Respondent(s) Mr. Maninder Singh, Sr. Adv.
Ms. Reena Jain Malhotra, Adv.
Mr. Suvendu Suvasis Dash, Adv.
Ms. Swati Vaibhav, Adv.
For M/s Vaibhav And Dash Law Associates, AOR
UPON hearing the counsel the Court made the following
O R D E R
The parties are the same in both these petitions and as such they are taken up together. In both these petitions, the petitioner is seeking that the sole arbitrator be appointed to adjudicate the dispute and difference between the parties. In Arbitration Petition Signature Not Verified Digitally signed by Sanjay Kumar Date: 2021.02.02 No.04 of 2021, the dispute is stated to have arisen under the 16:09:23 IST Reason:
Equipment Purchase Agreement with Deferred Payment Option dated 2
02.12.2015. In Arbitration Petition No. 05 of 2021, the dispute is stated to have arisen under the Equipment Lease Agreement with Purchase Option dated 01.04.2015.
In both these petitions, the factual matrix is that the respondent herein had issued notices dated 08.10.2020, invoked the arbitration clause and appointed Justice Indermeet Kaur Kochhar, Former Judge of the Delhi High Court as the Sole Arbitrator. The said notice is stated to have been issued in terms of the respective arbitration clauses in the agreements in question. The petitioner, through their reply dated 20.10.2020 called upon the respondent to unconditionally withdraw the notice and without prejudice to the same, also did not agree to the name of the Arbitrator suggested by the respondent. The learned Arbitrator has already entered reference. In that background, the instant petition is filed by the petitioner seeking appointment of the Arbitrator.
At the outset, we are of the opinion that the instant petition under Section 11 of the Arbitration and Conciliation Act, 1996 (‘Act 1996’ in short) will not be sustainable inasmuch as the learned Arbitrator has already been appointed and has entered reference. Further, the instant petition is not at the instance of the party who has invoked the arbitration clause.
Mr. Ritin Rai, learned Senior Advocate for the petitioner has, however, placed reliance on the decision in the case of Walter Bau AG Legal Successor, of The Original Contractor, Dyckerhoff and Widmann A.G. vs. Municipal Corporation of Greater Mumbai and Anr. (2015) 3 SCC 800 with specific reference to para 10 to contend that unless the appointment of the arbitrator is ex facie valid and such 3 appointment satisfies the Court exercising jurisdiction under Section 11(6) of the Arbitration Act, the acceptance of such appointment as fait accompli to debar the jurisdiction under Section 11(6) cannot be countenanced in law. Having noted the said contention we find that the said decision is rendered in a different circumstance. In that case the arbitration clause provided a different procedure whereunder the party invoking the arbitration clause had appointed the arbitrator and the arbitrator on behalf of the respondent was to be appointed from the panel of International Centre for Alternative Dispute Resolution (ICADR), as per the specified procedure. However, the appointment had been made contrary to the procedure agreed between the parties. In that circumstance, the appointment of the arbitrator was made by this Court, notwithstanding an arbitrator already appointed.
In the instant case, the arbitration clause provides that if the parties fail to resolve the dispute within 60 business days from the time a party has requested for negotiations to settle the dispute, then either party may serve notice on the other party requiring the dispute to be settled solely and finally by a sole arbitrator appointed in accordance with the Arbitration and Conciliation Act, 1996. In that view, the respondent invoking the said clause issued the notice dated 08.10.2020 appointing the learned Arbitrator. The respondent though is now seeking appointment of Arbitrator, in the reply dated 20.10.2020 has in fact contended that there exists no valid arbitration agreement between the parties. Without prejudice, it has been further contended that the said notice is premature inasmuch as due process 4 as provided under the arbitration clause has not been followed. It was stated so since according to the petitioner a genuine/legitimate one-time offer had been made on 06.10.2020 and the matter was at the dispute resolution stage. Further without prejudice to the said contentions the suggested name of the arbitrator was not agreed to.
In that view, in the present facts, it is not a case where the petitioner had invoked the arbitration clause and the respondent had failed to agree to the appointment, due to which they are before this Court under Section 11 of Act, 1996. Further, as noted in the reply to the notice invoking arbitration clause the petitioner has disputed the arbitration clause and in the alternative contended that the pre-arbitration negotiation has not been completed. Since such a stand had been taken by the petitioner in the reply notice, even if the petitioner has any grievance with regard to the manner in which the Arbitrator has been appointed and has entered reference, the contentions could be urged before the Arbitrator by way of objection or in such other proceedings. A petition under Section 11(6) seeking appointment of the Arbitrator in this situation, is not sustainable.
Accordingly, in the present facts and circumstances, we decline to entertain the petitions, they are therefore dismissed.
Pending interlocutory applications, if any, stand disposed of.
(SANJAY KUMAR-II) (INDU KUMARI POKHRIYAL) ASTT. REGISTRAR-cum-PS ASSISTANT REGISTRAR