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2022 Supreme(Cal) 430

IN THE HIGH COURT OF CALCUTTA
Debangsu Basak, J.
Eastern Coalfields Limited - Appellant
Versus
Rrepl-Kipl (JV) - Respondent
IA No. GA/1/2022, In RVWO/2/2022 with With IA No. GA/2/2022, In RVWO/2/2022 with IN A.P. No. 371 of 2020
Decided On : 18-08-2022

Advocates appeared:
Mr. Manik Das, Adv, Ms. Tanushree Dasgupta, Adv, for the Appellant; Mr. Sudip Deb, Adv, Mr. Riju Ghosh, Adv, for the Respondent

The judgment establishes the requirement of a written agreement for arbitration, the interpretation of settlement of disputes clauses, and the significance of party conduct in determining the existence of an arbitration agreement.

Headnote:

Arbitration Agreement - Dispute Resolution - Arbitration and Conciliation Act, 1996 - Section 11, Section 16 - AP No. 371 of 2020, R N Samanta Versus Coal India Ltd, FMA 1497 of 2018 (South-Eastern Coalfields Ltd versus Cart Road Wings JV), Civil Appeal No. 4914 of 2022 (Mahanadi Coalfields Ltd versus M/s IVCL AMR Joint Venture)

Fact of the Case:

The respondent applied under Section 11 of the Arbitration and Conciliation Act, 1996 for appointment of an arbitrator in a contract dispute. The applicant sought review of the order, citing previous court decisions on similar clauses. The respondent argued that the order was largely on consent and the applicant's conduct indicated agreement to arbitration.

Finding of the Court:

The court reviewed the clause alleged to contain the arbitration agreement and considered the conduct of the parties. It held that there was no arbitration agreement between the parties, dismissing the application as not maintainable.

Issues: Existence of arbitration agreement, Conduct of the parties, Interpretation of settlement of disputes clause

Ratio Decidendi: The court considered the requirement of a written agreement for arbitration, the interpretation of the settlement of disputes clause, and the conduct of the parties to determine the existence of an arbitration agreement.

Final Decision: RVWO No. 2 of 2022 is allowed. The order dated April 9, 2021 is reviewed and held that there is no arbitration agreement between the parties. AP No. 371 of 2020 is dismissed as not maintainable. No order as to costs.

JUDGMENT

Debangsu Basak, J. - The applicant has applied for review of the judgement and order dated April 9, 2021 passed in AP No. 371 of 2020. The applicant has also applied for stay of the operation of such order by way of an interim application filed in the review petition. Both the applications for stay as well as the review petition have been heard analogously.

2. The respondent herein had applied under Section 11 of the Arbitration and Conciliation Act, 1996 for appointment of an arbitrator in respect of disputes arising out of a contract entered into between the respondent and the applicant which the respondent claimed to contain an arbitration agreement. Such application under Section 11 of the Arbitration and Conciliation Act, 1996 had been disposed of by an order dated April 9, 2021 review of which has been sought in the present review petition.

3. Learned advocate appearing for the applicant has submitted that, the applicant had preferred a special leave petition before the Hon'ble Supreme Court against the order dated April 9, 2021 passed in AP No. 371 of 2020. The special leave petition had been disposed of by the order dated November 26, 2021. By the order dated November 26, 2021, the Hon'ble Supreme Court had permitted the applicant to file a review application before the High Court. Pursuant to such liberty being granted, the applicant had filed a review petition which was dismissed as withdrawn with liberty to file a fresh on February 10, 2022. Subsequent thereto, the applicant had filed the present review application.

4. Learned advocate appearing for the applicant has referred to the clause alleged to be containing the arbitration agreement. He has submitted that, similar clauses in contracts have been considered by a single judge of this Hon'ble Court, the division bench of this Hon'ble Court, and the Hon'ble Supreme Court. In all such occasions, the Courts had held that, such clause does not contain any arbitration agreement. He has relied upon the order dated December 22, 2021 passed in AP No. 817 of 2021 (R N Samanta Versus Coal India Ltd), judgement and order dated June 27, 2018 passed in FMA 1497 of 2018 (South-Eastern Coalfields Ltd versus Cart Road Wings JV), and the judgement and order dated July 25, 2022 passed in Civil Appeal No. 4914 of 2022 (Mahanadi Coalfields Ltd versus M/s IVCL AMR Joint Venture) in support of his contentions.

5. Learned advocate appearing for the respondent has submitted that, the order dated April 9, 2021 was passed largely on consent of the parties. He has referred to the body of the order dated April 9, 2021. He has submitted that, immediately after the arbitration clause contained in the agreement having been set out in the order dated April 9, 2021, the Court had recorded that, the existence of arbitration agreement is not disputed. He has contended that, such recording in the order tantamount to the parties to the litigation, agreeing to the existence of an arbitration agreement governing the disputes between the parties. He has drawn the attention of the Court to the fact that, the applicant subsequently raised counterclaim as against the respondent.

6. Learned advocate appearing for the respondent has drawn the attention of the Court to the conduct of the applicant subsequent to the order dated April 9, 2021. He has contended that, the applicant had waived its alleged right of review of the order dated April 9, 2021 by conduct of the applicant subsequent to the order dated April 9, 2021. The applicant had participated in the arbitration proceedings unconditionally. The applicant had applied under Section 16 of the Arbitration and Conciliation Act, 1996. He has referred to the minutes of the meeting of the arbitral tribunal dated July 31, 2022. He has contended that, the applicant has not taken any steps thereafter with regard to the finding of the arbitral tribunal as recorded in the minutes of the meeting July 31, 2022.

7. Learned advocate appearing for the respondent has

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