Delhi High Court - Orders
M/S G K Ventures vs M/S Knockout Wellness Labs Llp on 12 September, 2022
Author: Anup Jairam Bhambhani
Bench: Anup Jairam Bhambhani
$~4
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ ARB.P. 619/2022
M/S G K VENTURES ..... Petitioner
Through: Mr. Vineet Kumar Yadav, Advocate
with Mr. Amir Yadav, Advocate.
versus
M/S KNOCKOUT WELLNESS LABS LLP ..... Respondent
Through: Mr. Keshav Kumar Srivastava,
Advocate with Mr. Mohit Singh,
Advocate.
CORAM:
HON'BLE MR. JUSTICE ANUP JAIRAM BHAMBHANI
ORDER
% 12.09.2022 By way of the present petition under section 11(6)(a) of the Arbitration & Conciliation Act 1996 ('A&C Act' for short), the petitioner seeks appointment of an arbitrator to adjudicate upon the disputes that are stated to have arisen with the respondent from Area Franchise Agreement dated 08.05.2017.
2. Mr. Vineet Kumar Yadav, learned counsel for the petitioner has drawn the attention of this court to Clause 4 of Article XXIX of the agreement, which comprises the arbitration agreement between the parties; and contemplates reference of disputes between them to Signature Not Verified Digitally Signed By:SUNITA RAWAT Signing Date:14.09.2022 Arb. P. 619/2022 Page 1 of 4 12:25:56 arbitration in accordance with the A&C Act; with a stipulation that arbitration is to be held in New Delhi.
3. For completeness, it may be recorded that a separate territorial jurisdiction provision is also contained in Clause 3 of Article XXIX, which also subjects the contract between the parties to the exclusive jurisdiction of courts of law at New Delhi.
4. As per the record, the petitioner invoked arbitration vide notice dated 07.04.2022; to which the respondent sent no reply.
5. Pursuant to notice on this petition issued on 23.05.2022, Mr. Keshav Kumar Srivastava, Advocate has entered appearance on behalf of the respondent. Although no reply has been filed to the petition, Mr.Srivastava submits that the respondent has only one objection to the reference being made, viz. that the claims sought to be raised by way of the present petition, are time-barred.
6. In this behalf, Mr. Srivastava has drawn attention to notice dated 15.03.2018, whereby the respondent had admittedly terminated the franchise agreement with the petitioner; but the petitioner, having acknowledged the same, raised their disputes only by way of demand- cum-invocation notice dated 07.04.2022. This, Mr. Srivastava submits, is beyond the 03-year limitation period available to the petitioner under law to raise its claims against the respondent. It is pointed-out that the petitioner's claim is for alleged illegal termination of the franchise agreement and for refund of Rs. 82.62 lacs stated to have been paid by the petitioner to the respondent under the franchise agreement.
Signature Not Verified Digitally Signed By:SUNITA RAWAT Signing Date:14.09.2022 Arb. P. 619/2022 Page 2 of 4 12:25:567. For the record, it is noticed that the present petition under section 11 of the A&C Act was filed on 18.05.2022, viz. well within the 03-year limitation period provided under Article 137 of the Limitation Act 1963.
8. In response to the aforesaid objection however, Mr. Yadav, learned counsel for the petitioner submits that limitation for invoking arbitration in the present case, which was 03 years from 15.03.2018 ran-out on 14.03.2021. It is submitted that the last date of expiration of the limitation period however fell within the period 15.03.2020 and 28.02.2022, during which period, limitation for all proceedings were held in abeyance by order dated 10.01.2022 made by the Hon'ble Supreme Court in Suo Motu W.P.(C) No.03/2020; and that therefore, the petitioner was entitled to invoke arbitration within 90 days from 01.03.2022, as permitted by the Hon'ble Supreme Court in para 5(III) of order dated 10.01.2022.
9. After making rival submissions as above however, learned counsel for the parties jointly request that the matter be referred to arbitration under the aegis of the Delhi International Arbitration Centre, New Delhi (DIAC).
10. Upon a conspectus of the averments contained in the petition, the stand taken by the respondent and the submissions made, this court is satisfied that there is a valid and subsisting arbitration agreement between the parties; that this court has territorial jurisdiction to entertain and decide the present petition; and also that the disputes that are stated to have arisen between the parties as set-out inter-alia Signature Not Verified Digitally Signed By:SUNITA RAWAT Signing Date:14.09.2022 Arb. P. 619/2022 Page 3 of 4 12:25:56 in demand-cum-invocation notice dated 07.04.2022 do not appear ex- facie to be non-arbitrable.
11. Accordingly, the present petition is allowed; and the disputes between the parties are referred to arbitration under the aegis of the DIAC; with a request to the Co-ordinator, DIAC to appoint an appropriate arbitrator in the matter, in accordance with the rules and regulations of DIAC; and subject to arbitrator's fee and arbitration costs, as may be applicable under such rules.
12. All rights and contentions of the parties, in relation to their claims/counter-claims are left open, to be considered and decided by the learned Sole Arbitrator, in accordance with law.
13. Parties are directed to approach the Co-ordinator, DIAC for the above purpose within 10 days.
14. A copy of this order be communicated to the Co-ordinator, DIAC, for information and compliance.
15. The petition stands disposed of in the above terms.
16. Pending applications, if any, also stand disposed of.
ANUP JAIRAM BHAMBHANI, J SEPTEMBER 12, 2022 Ne Signature Not Verified Digitally Signed By:SUNITA RAWAT Signing Date:14.09.2022 Arb. P. 619/2022 Page 4 of 4 12:25:56