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Trans Image Corporation vs National Technical R Esearch ... on 15 November, 2022

Author: Prateek Jalan

Bench: Prateek Jalan

                          $~2
                          *      IN THE HIGH COURT OF DELHI AT NEW DELHI

                          +      ARB.P. 1070/2022

                              TRANS IMAGE CORPORATION                       ..... Petitioner
                                            Through: Mr. Adhirath Singh, Ms. Raymon
                                                       Singh and Mr. Arsh, Advocates.
                                                   versus
                              NATIONAL TECHNICAL R
                              ESEARCH ORGANISATION.                      ..... Respondent
                                            Through: Mr. Ajay Digpaul, CGSC with Mr.
                                                       Kamal Digpaul, Ms. Swati Kwatra
                                                       and    Mr.     Piyush       Krishna,
                                                       Advocates.
                          CORAM:
                          HON'BLE MR. JUSTICE PRATEEK JALAN

                                                  ORDER

% 15.11.2022 I.A. 18570/2022 (for condonation of delay)

1. This is an application seeking condonation of delay in filing the reply to the petition.

2. For the reasons stated in the application, it is allowed, and the reply is taken on record.

3. The application is disposed of in these terms.

1. 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 which have arisen between the parties under a contract dated 10.09.2015 for supply, installation, testing and commissioning of Strategic Thuraya GmPRS System ["the Contract"].

2. It appears that disputes arose between the parties with regard to a deduction of liquidated damages made by the respondent. The Contract contains an arbitration agreement [Clause 8], which provides for resolution of disputes by arbitration under the aegis of the International Centre for Alternative Dispute Resolution ["ICADR"].

3. The petitioner has also filed proceedings under Section 9 of the Act seeking interim measures of protection in anticipation of arbitral proceedings, which is pending before the learned District Judge, Commercial Court- 01, Patiala House District Courts, New Delhi [OMP(COMM.) No. 103/2022].

4. The petitioner has invoked the arbitration agreement by a communication dated 26.07.2022, addressed to ICADR, and the respondent. The said notice failed to elicit a response from the respondent. It is in these circumstances that the present petition has been filed.

5. Mr. Jatin Sehgal, learned counsel for the petitioner, has also drawn my attention to the New Delhi International Arbitration Centre Ordinance, 2019, whereby ICADR has been dissolved, and its undertaking has been transferred.

6. Pursuant to the notice issued on 12.09.2022, Mr. Ajay Digpaul, learned Central Government Standing Counsel, enters appearance on behalf of the respondent, and states that the respondent has also filed a reply to the petition. Mr. Digpaul submits upon instructions that the respondent has acted scrupulously in terms of the Contract and disputes which are now being raised by the petitioner are misplaced. He argues that the respondent has, in fact, made payments of all amounts due to the Signature Not Verified Digitally Signed By:SHITU NAGPAL ARB.P.1070/2022 Page 2 of 4 Signing Date:16.11.2022 12:45:32 petitioner under the Contract. On this basis, he submits that there is no dispute which requires reference to arbitration.

7. In the context of a petition under Section 11 of the Act, these contentions are entirely misconceived. The respondent's defence on the merits of the petitioner's claims are not required to be adjudicated at this stage. There is no dispute as to the existence of the Contract or an arbitration clause contained therein. For the purposes of Section 11 of the Act, the existence of an arbitration agreement, and the fact that disputes have arisen, which require adjudication, is sufficient for reference to arbitration. I am, therefore, of the view that the petition is liable to succeed.

8. The petition is, therefore, allowed, and disposed of with the following directions:-

a. Ms. Anita Sahani, Advocate [Tel:- 9810113256] is appointed as the Arbitrator to adjudicate disputes arising between the parties under the contract dated 10.09.2015 for supply, installation, testing and commissioning of Strategic Thuraya GmPRS System. b. The arbitration will be held under the aegis of the Delhi International Arbitration Centre, Delhi High Court, Shershah Road, New Delhi-110503 ["DIAC"], and will be governed by 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 into the reference.

9. It is made clear that all rights and contentions of the parties are expressly reserved, including as to the maintainability of the proceedings, Signature Not Verified Digitally Signed By:SHITU NAGPAL ARB.P.1070/2022 Page 3 of 4 Signing Date:16.11.2022 12:45:32 arbitrability of disputes, and on merits of the claims of either of the parties.

10. The petition is disposed of with these directions.

PRATEEK JALAN, J NOVEMBER 15, 2022/'vp' / Signature Not Verified Digitally Signed By:SHITU NAGPAL ARB.P.1070/2022 Page 4 of 4 Signing Date:16.11.2022 12:45:32