Point of Law: It is a settled position of law that Section 42 of the Act would not apply to an application that has been filed under Section 11 of the Act.

JUDGMENT :

V. KAMESWAR RAO, J.

1. This petition has been filed under Section 11(5) of the Arbitration & Conciliation Act, 1996 (‘the Act’, for short) for appointment of an Arbitrator.

2. The brief facts, as noted from the petition are that the petitioner entered into a Master Lease Agreement dated August 26, 2016 (‘the Agreement’, for short), for taking on lease a vehicle with respondent No.1, being the lessee and respondent No.2, being the co-lessee.

3. As per the terms of the Agreement, respondents agreed to pay lease rent of Rs.8,683/- along with service tax for the use of the vehicle leased during the tenure of the Agreement, i.e. 24 months. The Agreement also stipulated, as per Article 2.5, that the respondents shall not be entitled to any claim of ownership of the vehicle or challenge the petitioner’s ownership right, title or interest in the leased vehicle during the subsistence of the agreement.

4. It is the case of the petitioner that the respondents defaulted in payment of the lease rental and accordingly a demand notice was sent on November 21, 2018, which was followed by a notice invoking the arbitration clause dated February 22, 2019, by which the petitioner suggested the name of an Advocate to act as a Sole Arbitrator. It appears that a reply dated March 07, 2019 was sent by the respondent No.1, contesting the legal notice dated February 22, 2019 of the petitioner and showing disagreement with the name of the Arbitrator as suggested by the petitioner. In fact, the respondent No.1 in the said reply, suggested the name of a Retired Additional District & Sessions Judge to be appointed as an Arbitrator, which was objected by the petitioner vide Notice dated March 20, 2019.

5. A reply to the petition has been filed by the respondent No.1, wherein the respondent No.1 has taken an objection that this Court does not have the jurisdiction to adjudicate the present petition, in view of Article 22.1 in the Agreement dated August 26, 2016, which stipulates that the Sole Arbitrator is to be appointed by the Chief Justice of Bombay High Court or any other Institution as appointed by the former. The relevant arbitration clause of the Agreement reads as under:-

“Article-22

ARBITRATION AND JURISDICTION

22.1 In the case of any dispute or any difference between the Parties arising out of or in relation to this Agreement including dispute or difference as to the validity of this Agreement or interpretation or any of the provision of this Agreement, the same shall be resolved by mutual discussion. If the Parties fail to settle the dispute or difference mutually within 15 days after the dispute shall have arisen then the same shall be referred to Arbitration or the sole arbitrator, appointed by the Parties by mutual agreement. If the Parties fail to agree to a common sole Arbitrator within 45 days after the dispute shall have arisen either party shall make an application to the Chief Justice of the Bombay High Court or any other person or Institution appointed by him for the appointment of the Sole Arbitrator and such arbitration shall be governed by the Arbitration and Conciliation Act, 1996 or any statutory modification or re-enactment thereof for the time being in force. The provisions of this Article shall survive the termination of this Agreement. Each Party shall bear as own costs, all common costs shall be shared equally by both the Parties. The venue of the arbitration shall be New Delhi. The language of arbitration shall be English.

xxxx xxxx xxxx”

6. I may also, at this stage note, that it stated in the petition, that a petition under Section 9 of the Act had been filed by the petitioner before the District Court, Patiala House, New Delhi, seeking appointment of a receiver, which was allowed by the concerned Court. It is also pertinent to note that the parties have agreed for New Delhi, to be the venue of the arbitration and agreed that it shall be the Civil Courts in New Delhi which shall have exclusive jurisdiction for any dispute ar