JUDGMENT :

Dhananjaya Y Chandrachud, J.

1. Leave granted.

2. This appeal arises from a judgment and order of a learned Single Judge of the High Court of Madhya Pradesh dated 30 November 2016 where it appointed an Arbitrator in the dispute between the parties, in an application¹[“AC No 1 of 2015”] filed by the respondent under Section 11(6) of the Arbitration and Conciliation Act 1996 ²[“1996 Act”].

3. The genesis of the matter is from when the Madhya Pradesh Electricity Board ³ [“Board”], entered into a Power Purchase Agreement ⁴[“PPA”] on 20 May 1999 with the respondent. Under the PPA, the respondent was to establish a mini hydro-electric project on a built and operate basis. However, the PPA was terminated on 27 September 2001 by the Board. The respondent initially filed a writ petition ⁵[“WP No 2642 of 2002”] challenging the termination of the PPA. The High Court, by its order dated 4 November 2009, declined to entertain the petition in view of an arbitration agreement contained in Clause 12. 3⁶[“12.3 Arbitration:

(a) If dispute cannot be salted within Thirty (30)days mutual discussions as (sic) by section 12.1 and (sic) to Conciliation is not elected by the Parties pursuant to Section 12.2 of if a Parties so requests in accordance with Section 12.2 the Dispute shall in dally be settled by an Umpire to be appointed by two arbitrators one to be appointed by the Board and other by the Company Provisions of the Indian Arbitration and Conciliation Act 1996 9or any enactment that replaces the said Act) shall apply in such arbitrator. The arbitration proceedings shall be held at head Quarter of the Board i.e. at Jabalpur.

(b) The award rendered shall apportion the costs of the arbitration.

(c) The award rendered in any arbitration commended here under shall be final conclusive and binding upon the Parties and award may be entered in any Court having jurisdiction as darned under article 15.1.”] of the PPA. Thereafter, the respondent filed a review petition ⁷[“Review Petition No 716 of 2009”] which was dismissed by the High Court by an order dated 10 December 2009.

4. As a consequence of the orders dated 4 November 2009 and 10 December 2009, on 28 December 2009, the respondent issued a notice to the Board under Clause 12.1 of the PPA, seeking to resolve the dispute by mutual discussion. Since the respondent did not receive a reply to the notice dated 28 December 2009 from the Board, on 30 May 2011, the respondent issued another notice to the Board invoking arbitration under Clause 12.3 of the PPA. In the notice, the respondent stated that if the Board did not act upon the notice within 30 days of its receipt, it would approach the High Court under Section 11(6) of the 1996 Act.

5. Having received no reply from the Board, an application ⁸ [“AC No 76 of 2011”] was filed under Section 11(6) of the 1996 Act by the respondent seeking the appointment of an arbitrator. The High Court, by its order dated 21 January 2014, recorded that the respondent and the appellant had agreed to nominate their arbitrators, and observed that the two arbitrators would proceed to appoint a third arbitrator, in accordance with the procedure in Clause 12.3(a) of the PPA. The nominated Arbitrators fixed their first meeting on 7 May 2014, when both parties appeared and the Arbitrators ’ fee was fixed. However, the Arbitrators, by a letter dated 7 July 2014, highlighted their inability to proceed with the arbitration proceedings on the ground that their fees had not been paid.

6. Thereafter, the respondent filed AC No 1 of 2015 on 8 December 2014, seeking the appointment of an arbitrator under Section 11(6) of the 1996 Act. This application was opposed by the appellant on the ground that, in view of the provisions of Section 86(1)(f) of the Electricity Act 2003 ⁹[“2003 Act”], it was the State Electricity Commission which was vested with the exclusive jurisdiction to adjudicate upon disputes between licensees and generating companies. By the impugned judgment and order dat