Delhi High Court - Orders
Collegedunia Web Private Limited vs Pdm University & Ors on 16 February, 2021
Author: Vibhu Bakhru
Bench: Vibhu Bakhru
$~2
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ ARB.P. 244/2020
COLLEGEDUNIA WEB PRIVATE LIMITED ..... Petitioner
Through Mr Preet Singh Oberoi, Advocate
versus
PDM UNIVERSITY & ORS. ..... Respondents
Through Mr Aditya Wadhwa, Advocate with
Mr Siddharth Sunil, Advocate
CORAM:
HON'BLE MR. JUSTICE VIBHU BAKHRU
ORDER
% 16.02.2021 [Hearing held through videoconferencing] ARB.P. 244/2020 & I.A. 5837/2020
1. The petitioner has filed the present petition under Section 11 of the Arbitration and Conciliation Act, 1996 (A&C Act), inter alia, praying that an Arbitrator be appointed to adjudicate the disputes that have arisen between the parties in connection with an Agreement/Memorandum of Understanding (MOU) dated 20.12.2017 for providing certain services.
2. Admittedly, the said MOU was executed between the petitioner and respondent No.1. The said MOU also includes an Arbitration Clause that reads as under:-
"Dispute, if any shall be referred to a Sole Arbitrator in accordance with the provisions of Arbitration and Conciliation Act, 1996. The decision of the Arbitrator shall be final and binding on both the parties. The venue of the Arbitration shall Signature Not Verified Digitally Signed By:DUSHYANT RAWAL Signing Date:17.02.2021 05:51 be at Delhi and the courts at Delhi shall have the exclusive jurisdiction over the disputes between the parties."
3. The respondent no.1 has contested the present petition on two fronts. First, the learned counsel for the respondent no. 1 submits that the said MOU is novated by a Tax Invoice dated 20.01.2020 which was raised in respect of services rendered under the MOU. It is pointed out that the said Invoice includes a Clause that provides that "All disputes are subject to jurisdiction of Court in Haryana, India only". It is contended that in view of the said Clause, the parties have novated the MOU and the Arbitration Clause does not survive.
4. Second, it is submitted that the MOU is not stamped and therefore the parties cannot be referred to Arbitration.
5. Insofar as the respondent's first contention is concerned, the same is unmerited. It is apparent from the tenor of the Tax Invoice dated 20.01.2020 that the said Invoice is for the services under the MOU. It is further noticed that the said Invoice is addressed to PING Global Services Private Limited. According to the petitioner, the Invoice was raised in the aforesaid manner at the request of respondent No.2. However, the services were rendered in terms of the MOU dated 20.12.2017.
6. In view of the above, this Court is unable to accept that the Tax Invoice supersedes the Arbitration Clause contained under the MOU. It is also relevant to note that the Clause under the Tax Invoice (which has been issued in terms of the MOU) provides that the jurisdiction regarding disputes relating to the Invoice would be exercised by the Courts in Haryana. The said Clause neither negates nor replaces the Arbitration Clause.
7. In view of the above, the contention that the Arbitration Agreement Signature Not Verified Digitally Signed By:DUSHYANT RAWAL Signing Date:17.02.2021 05:51 does not exist between the parties, cannot be accepted.
8. The second contention that the parties cannot be referred to Arbitration as the MOU/Agreement is unstamped, is also unpersuasive as the MOU essentially falls within the scope of an agreement for providing goods and services. Prima facie, an Agreement of such a nature is exempted from stamp duty under Article 5 of Schedule I of the Indian Stamp Act, 1899.
9. The learned counsel appearing for the petitioner has also referred to the decision of a Coordinate Bench of this Court in The Srijan School v. Harvinder Singh: 2016 SCC OnLine DL 1931, whereby the Court had noted that a contract relating to the Labour Rate for contract of building work would fall within the exception of Article 5 of Schedule I of the Indian Stamp Act, 1899. The learned counsel appearing for the respondent has not addressed any contention to counter the above contention.
10. In any event, the learned counsel for the petitioner had also submitted that the petitioner is willing to deposit the stamp duty/ penalty equal to 10 times the applicable stamp duty of "8 Annas" which, according to the petitioner, would work out to be ₹5/-. It is further submitted that even if a minimum stamp duty of ₹10/- is accepted the amount payable along with the penalty would be ₹100/-. Since the petitioner is also willing to deposit the said amount with the Registry of this Court, there is no question of impounding of the MOU.
11. The petitioner is bound down to the said statement that the petitioner would deposit the stamp duty of ₹100/- with the Registry of this court. Let the same be deposited within a period of one week from today.
12. Respondent nos. 2 to 4 are not parties to the MOU and cannot be Signature Not Verified Digitally Signed By:DUSHYANT RAWAL Signing Date:17.02.2021 05:51 referred to arbitration.
13. In view of the above, the present petition is allowed and Mr. Amit Gupta, Advocate (mobile no. - 9810273846) is appointed as the Sole Arbitrator to adjudicate the disputes between the parties (the petitioner and Respondent no.1) in connection with the MOU dated 20.12.2017, which fall within the scope of the Arbitration Clause as is set out above.
14. This is subject to the learned Arbitrator making the necessary disclosure under Section 12 (1) of the A&C Act and not being ineligible under Section 12(5) of the A&C Act.
15. The Arbitrator's fees shall be in accordance with Schedule IV of the A&C Act.
16. The concerned parties are at liberty to approach the learned Arbitrator for further proceedings.
VIBHU BAKHRU, J FEBRUARY 16, 2021 nn Signature Not Verified Digitally Signed By:DUSHYANT RAWAL Signing Date:17.02.2021 05:51