JUDGMENT :

1. Heard Mr. Pandey, learned Advocate for Applicant and Mr. Shah, learned Advocate for Respondents.

2. The present Arbitration Application is filed under Section 11 of the Arbitration & Conciliation Act, 1996 (for short “the said Act”) for seeking appointment of an Arbitrator in pursuance to “Settlement of disputes” clause in the agreement executed between the parties with respect to dispute having arisen on account of outstanding payment in respect of Loan Account bearing No. ABFLBANIL0000070307. The Application is contested by the Respondents.

3. To appreciate the lis between the parties, such of the relevant facts which are necessary for adjudication are stated herein under:-

3.1. Applicant is a Finance Company, inter alia, engaged in the business of providing loans and finances. Respondent No. 1 is the sole proprietary concern of Respondent No. 3. Respondent No. 2 is the wife of Respondent No. 3.

3.2. Respondents in order to avail a loan finance facility from Applicant Company approached the Applicant and executed the Loan Application Form dated 25.10.2019 (Exh. “B”), submitted the copies of their KYC documents and executed acknowledgment form containing the Most Important Information (Exh. “C”). At the request of Respondents, Applicant sanctioned loan of an amount of Rs. 90,66,393/- to Respondents pursuant to which Respondents executed the Standard Terms and Conditions dated 25.10.2019 in confirmation of their acceptance of the same.

3.3. Respondents executed an End User Declaration dated 25.10.2019 (Exh. “E”) in respect of the sanction of the loan amount of Rs. 90,66,393/- undertaking that the monies shall be used for the purpose of working capital only.

4. Mr. Pandey, learned Advocate for Applicant would submit that as per Clause (1) of the terms and conditions executed between parties, Applicant agreed to lend and Respondents in turn agreed to avail loan from the Applicant. As per Clause (4), Respondents agreed to pay the loan amount along with interest payable thereon by way of Equated Monthly Installments (EMIs). He would submit that Respondents had undertaken to timely repay the principal amount along with interest as per the contractual rate without any delay or default. However, on account of failure of Respondents to make payment on time, substantial amount became due and payable and remained outstanding. He would submit that since Respondents failed to maintain financial discipline under the agreed terms and conditions of the loan transaction and failed to make the payment on the due dates despite repeated reminders, Applicant issued loan recall notice dated 15.07.2020 (Exh. “G”) to the Respondents. Respondents did not adhere to the loan recall notice and despite receipt of the same, failed to comply with the same. He would submit that under the terms and conditions which provided for “settlement of disputes”, it was provided as under:-

“Any differences or disputes arising out of or touching the terms and conditions of the principle agreement(s) and this offer shall be settled amicably in the first instance. Unresolved disputes or differences shall be referred to a sole arbitrator who shall be appointed by ABFL only and the borrower shall have no objection to the same. The Arbitration shall be governed by the Arbitration and Conciliation Act, 1996 or any statutory modification or re-enactment thereof and the rules made there under and for the time being in force. The award of the arbitrator shall be final, conclusive and binding on the parties. The venue of such arbitration proceedings shall be Mumbai and shall be conducted in the English language only.”

4.1. He would submit that since the dispute had arisen and the Respondents failed to acknowledge, repay and settle the same amicably, it was provided that unresolved disputes or differences be referred to the sole Arbitrator to be appointed by the Applicant only and the borrower would have no objection to the same. He would submit that the said “settlement of