IMPORTANT POINTS
(1) Appointment of Arbitrator – Referral Court should be prima facie satisfied that there exists arbitration agreement and as to whether non-signatory is a veritable party.
(2) Mere legal or commercial connection is not sufficient for a non-signatory to claim through or under a signatory party.

JUDGMENT :

K.V. VISWANATHAN, J.

1. Leave granted.

2. The present appeal calls in question the correctness of the judgment and order dated 07.04.2025 passed by the learned Single Judge of the High Court of Judicature at Bombay in Comm. Arbitration Application No. 125/2025. By the said order, the learned Single Judge allowed the Section 11(4)-Application filed under the Arbitration and Conciliation Act, 1996 (for short the “A&C Act) of the respondent-BCL Secure Premises Pvt. Ltd. (hereinafter referred to as the “BCL”) and appointed an arbitrator to adjudicate upon the disputes and differences between the parties herein. Aggrieved, the appellant-Hindustan Petroleum Corporation Ltd. (for short ‘Corporation’) is in appeal.

3. The facts giving rise to the appeal are as follows.

4. The appellant-Corporation floated a tender for design, supply, installation, integration, testing, commissioning and post-commissioning warranty support services of Tank Truck Locking System (for short the “TTLS”).

5. The tender conditions had a specific clause stating that the contractor shall not be entitled to sublet, transfer or assign, the work under the contract without the prior consent of the owner obtained in writing. The relevant clauses of the tender conditions are set out herein-below:

“2.6 The “Contract” between the Owner and the Contractor shall mean and include all documents like enquiry, tender submitted by the contractor and the purchase order issued by the owner and other documents connected with the issue of the purchase order and orders, instruction, drawings, change orders, directions issued by the Owner/Engineer-in- Charge/Site-in-Charge for the execution, completion and commissioning of the works and the period of contract mentioned in the Contract including such periods of time extensions as may be granted by the owner at the request of the contractor and such period of time for which the work is continued by the contractor for purposes of completion of the work.

3.17 Contractor shall not be entitled to sublet, subcontract or assign; the work under this Contract without the prior consent of the Owner obtained in writing.

5.c SUBLETTING OF WORK

5.c.1 No part of the contract nor any share or interest thereof shall in any manner or degree be transferred, assigned or sublet, by the Contractor, directly or indirectly to any firm or corporation whatsoever without the prior consent in writing of the Owner.

14. ARBITRATION

14.1 All disputes and differences of whatsoever nature, whether existing or which shall at any time arise between the parties hereto touching or concerning the agreement, meaning, operation or effect thereof or to the rights and liabilities of the parties or arising out of or in relation thereto whether during or after completion of the contract or whether before after determination, foreclosure, termination or breach of the agreement (other than those in respect of which the decision of any person is, by the contract, expressed to be final and binding) shall, after written notice by either party to the agreement to the other of them and to the Appointing Authority hereinafter mentioned, be referred for adjudication to the Sole Arbitrator to be appointed as hereinafter provided.

14.9 Subject to the aforesaid, the provisions of the Arbitration and Conciliation Act, 1996 or any statutory modification or re- enactment thereof and the rules made thereunder, shall apply to the Arbitration proceedings under this Clause.

14.10 The Contract shall be governed by and constructed according to the laws in force in India. The parties hereby submit to the exclusive jurisdiction of the Courts situated at Mumbai for all purposes. The Arbitration shall be held at Mumbai and conducted in English language.”

6. On 20.08.2013, the appellant issued a purchase order in favour of the successful tenderer-M/s AGC Networks Ltd (for short “AGC”) (presently known as Black Box Limited) and AGC duly accepted the purchase order by a letter of acceptance on 21/22.08.20