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IN THE HIGH COURT OF DELHI AT NEW DELHI
Suresh Kumar Kait, J.
Bharti P Patel And Another & Ors. - Appellants
Versus
Harcharan Singh Ranauta & Anr. - Respondents
Arbitration Petition No. 28 of 2022
Decided On : 17-02-2022
Arbitration - Appointment of Sole Arbitrator - Summary: The court appointed a sole arbitrator to adjudicate a dispute between the parties as per the provisions of Section 11(5) of the Arbitration and Conciliation Act, 1996.
Fact of the Case:
The petitioners sought the appointment of a sole arbitrator to adjudicate a dispute arising from a Loan Repayment and Settlement agreement. The respondents failed to make payment despite a legal notice and failed to appoint an arbitrator after the arbitration clause was invoked.
Finding of the Court:
The court found that the respondents were duly served but chose not to appear, indicating no opposition to the petition. Consequently, the court appointed a sole arbitrator and directed compliance with Section 12 of the Arbitration and Conciliation Act, 1996.
Issues: Appointment of Sole Arbitrator, Non-compliance with Legal Notice, Failure to Appoint Arbitrator
Ratio Decidendi: The court's decision was influenced by the respondents' deliberate non-appearance, indicating no opposition to the petition, and the petitioners' compliance with the legal requirements for appointment of a sole arbitrator.
Final Decision: The court appointed a sole arbitrator and directed compliance with the Fourth Schedule of the Arbitration and Conciliation Act, 1996, thereby disposing of the present petition.
JUDGMENT
Suresh Kumar Kait, J. - The present petition has been preferred under the provisions of Section 11(5) of the arbitration and Conciliation act, 1996 seeking appointment of sole arbitrator to adjudicate the disputes inter-se the parties.
2. as per the case of the petitioners, on 17.08.2020, the petitioners and the respondents entered into a Loan Repayment and Settlement agreement whereby it was agreed that respondent No.1 would issue a post-dated cheque of Rs.12,05,50,191/- from his account for payment of the admitted liability. It is stated that respondent No.1 in conspiracy with other Directors of respondent No. 2, dishonestly issued a cheque of Rs.12,05,50,191/- from the dormant account of respondent No.2, which on presentation was returned. Thereafter, disputes arose between the parties.
3. accordingly, a legal notice was sent by the petitioners to the respondents on 28.07.2021 calling upon them to pay Rs.12,05,50,191/- along with interest @ 9% p.a. It is submitted that despite receipt of the said notice, the respondents failed to make any payment to the petitioners.
4. Subsequently, on 20.08.2021, petitioners invoked the arbitration Clause in terms of the Loan Repayment and Settlement agreement dated 17.08.2020. It is stated that despite receipt of the said notice, the respondents failed to appoint the arbitrator. Thereafter, petitioners moved the present petition.
5. as per office report from Registry, service report qua notice to respondent through dasti, courier, speed post, email, fax and Whatsapp is awaited. However, according to affidavit of service dated 08.02.2022 placed on record by petitioner, the respondents are served. It is mentioned in the affidavit that respondent has been served through e-mail and whatsapp. also, process sent through speed post has 'confirmed item delivery'.
6. In the opinion of this Court, respondents are duly served but they have chosen deliberately not to appear before this Court. Thus, it seems that they have nothing to oppose in the present petition.
7. accordingly, Mr. Justice (Retd.) M. C. Garg (Mobile: 9899337979) is appointed the sole arbitrator to adjudicate the dispute between the parties.
8. The fee of the learned arbitrator shall be governed by the Fourth Schedule of the arbitration and Conciliation act, 1996.
9. The learned arbitrator shall ensure compliance with Section 12 of arbitration and Conciliation act, 1996 before commencing the arbitration.
10. With aforesaid directions, the present petition is, accordingly, disposed of.
The court's decision was based on the deliberate non-appearance of the respondents and the petitioners' compliance with the legal requirements for appointment of a sole arbitrator.
The court affirmed the need for compliance with contractually agreed arbitration clauses, appointing an arbitrator when parties fail to cooperate.
Appointment of Sole Arbitrator and Compliance with Arbitration and Conciliation Act, 1996
The main legal point established in the judgment is the court's authority to appoint an arbitrator under Section 11(6) of the Arbitration and Conciliation Act, 1996, when the respondent deliberately ....
The main legal principle established in the judgment is the court's authority to appoint an arbitrator under Section 11 of the Arbitration and Conciliation Act, 1996 when a dispute arises and no arbi....
The court appointed a sole arbitrator for resolving disputes under a loan agreement after respondents failed to adhere to repayment terms and contested the agreement's existence.
The failure to provide proof of service for a notice under S. 21 of the Arbitration and Conciliation Act does not divest the Court of its power under S. 11 to appoint an arbitrator when a valid arbit....
The court ruled that a party's failure to comply with a contractual agreement justifies the appointment of an arbitrator under the Arbitration and Conciliation Act, validating service via multiple de....
In the absence of opposition, a court may appoint an arbitrator based on deemed service through electronic means for resolving contractual disputes.
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