Gujarat High Court
M/S Splash Bath Appliances Inc. Thru. ... vs M/S Team Global Logistics Pvt. Ltd on 19 March, 2021
Author: Bela M. Trivedi
Bench: Bela M. Trivedi
C/IAAP/94/2019 ORDER
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/PETN. UNDER ARBITRATION ACT NO. 94 of 2019
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M/S SPLASH BATH APPLIANCES INC. THRU. PARTNERS
Versus
M/S TEAM GLOBAL LOGISTICS PVT. LTD
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Appearance:
MS HETVI H SANCHETI(5618) for the Petitioner(s) No. 1
MS NANDINI JOSHI(1210) for the Respondent(s) No. 1
PARAS K SUKHWANI(8284) for the Respondent(s) No. 2
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CORAM: HONOURABLE MS. JUSTICE BELA M. TRIVEDI
Date : 19/03/2021
ORAL ORDER
1. The petitioner M/s. Splash Bath Appliances Inc. seeks appointment of the sole arbitrator for adjudicating the disputes and differences between the petitioner and respondent as provided under Section 11(5) read with Section 10 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as "the Act") or alternatively appoint the retired District Judge as an Arbitrator.
2. The petition is resisted by the respondents by filing their respective replies.
3. Heard Ms.Hetvi Sancheti, learned advocate for the petitioner, Ms.Nandini Joshi, learned advocate for respondent No.1 and Mr.Chirag Sukhwani, learned advocate for respondent No.2.
4. Learned advocate Mr.Sukhwani for respondent No.2 has raised preliminary objection to the effect that the Page 1 of 4 Downloaded on : Tue Aug 24 07:19:06 IST 2021 C/IAAP/94/2019 ORDER respondent No.2 is not a party to the agreement dated 11.06.2018, which is entered into between the petitioner and the respondent No.1 and, therefore, the application is not maintainable qua the respondent No.2.
5. Now, it is not disputed that the agreement dated 11.06.2018 was entered into between the petitioner and respondent No.1 in which respondent No.2 was not a party. As per Section 7 of the Act, "Arbitration Agreement" is an agreement by the parties to submit to arbitration all or certain disputes which have arisen or which may arise between them in respect of a defined legal relationship, whether contractual or not. Though repeatedly asked by the Court, the learned advocate Ms.Sancheti for the petitioner had failed to point out any agreement between the petitioner and respondent No.2 as contemplated under Section 7 of the Act. In that view of the matter, the Court is of the opinion that in absence of any arbitration agreement between the petitioner and the respondent No.2, the present petition qua the respondent No.2 can not be entertained and deserves to be dismissed.
6. So far as the respondent No.1 is concerned, admittedly, the petitioner and respondent No.1 had entered into an agreement which is on record at Annexure
- A which contains the Clause 25. The said Clause reads as under:
Page 2 of 4 Downloaded on : Tue Aug 24 07:19:06 IST 2021 C/IAAP/94/2019 ORDER"25. Arbitration The contract evidenced hereby or contained herein shall be governed by the construed according to Indian laws Any difference of opinion or dispute thereunder can be settled by arbitration in India or a place mutually agreed with each party appointing an arbitrator."
7. The learned advocate Ms.Joshi for respondent No.1, however, submitted that as per the said agreement, both the parties had to appoint an arbitrator and since, both the parties having not appointed their respective arbitrators, the present petition is premature. The Court is not in agreement with such a submission of learned advocate Ms.Joshi for respondent No.1. As transpiring from Clause 25, which contains arbitration clause, any difference of opinion or dispute arising out of the agreement was to be resolved by arbitration in India or a place mutually agreed with each party appointing an Arbitrator. Therefore, both the parties had to appoint their respective Arbitrator. However, learned advocate Ms.Sancheti for the petitioner submits that such a clause would be hit by Sub Section (1) of Section 10 of the Act, which states that the parties are free to determine the number of arbitrators provided that such number shall not be an even number. Sub Section (2) states that failing the determination referred to in Sub Section (1), the Arbitral Tribunal shall consist of a sole arbitrator. As such, Clause Page 3 of 4 Downloaded on : Tue Aug 24 07:19:06 IST 2021 C/IAAP/94/2019 ORDER 25 does not provide that two appointed arbitrators shall appoint the third arbitrator. The said Clause 25 providing even number of arbitrators, therefore, would be hit by Sub Section (1) of Section 10 and Sub Section (2) thereof would come into play. It is therefore required to be construed as contemplated in Sub-Section (2) of Section 10 of the Act that the parties have failed to determine the number of arbitrators and, therefore, the Arbitral Tribunal has to be of sole arbitrator.
8. Since, learned advocates for both the parties have not been able to agree to the name of the sole arbitrator and have requested the Court to appoint the sole arbitrator of the retired District Judge level to resolve the disputes between the petitioner and respondent No.1, Mr.U. T. Unadkar, retired Judge, City Civil and Sessions Court, Ahmedabad is proposed to be appointed as an Arbitrator to dissolve the dispute between the parties. Learned advocate Ms.Sancheti for the petitioner is directed to obtain the consent / declaration of Mr.U. T. Unadkar, retired Judge, City Civil and Sessions Court, Ahmedabad as contemplated in Sixth Schedule (under section 11(8) read with 12(1)(b) of the Arbitration and Conciliation Act, 1996), as amended by the Arbitration & Conciliation (Amendment) Act, 2015 before the next date.
Put up on 09.04.2021.
(BELA M. TRIVEDI, J) V.R. PANCHAL Page 4 of 4 Downloaded on : Tue Aug 24 07:19:06 IST 2021