IN THE HIGH COURT OF DELHI AT NEW DELHI
SACHIN DATTA, J.
ION EXCHANGE (INDIA) LTD. - Petitioner
Versus
DOOSAN POWER SYSTEMS INDIA PVT. LTD. - Respondent
ARB.P. No.846 Of 2022
Decided On : 24-01-2023
Arbitration and Conciliation Act, 1996 - Section 11 - Appointment of a Sole Arbitrator - Contract - Adjudicate disputes - Seeking appointment of a Sole Arbitrator to adjudicate disputes – Held, First part of said clause serves to prescribe that in first instance, parties shall endeavor to resolve all factual issues amongst themselves - Second part of clause, however, mandates arbitration in respect of “disputes, disagreements, questions or breach besides a question of fact” - It is inconceivable that any Arbitral Tribunal would adjudicate “disputes, disagreements, questions or breach” without examining / determining underlying factual matrix - Since, existence of arbitration agreement is not in dispute an Arbitral Tribunal is to be constituted in terms thereof - Any objection that respondent may have as regards scope and/or applicability of arbitration clause or as to any jurisdictional aspect, can be raised before Arbitral Tribunal - Ms. Justice Rekha Sharma, is appointed as Sole Arbitrator to adjudicate disputes between parties arising out - Petition disposed of.
JUDGMENT :
[Sachin Datta, J.]
1. The present petition has been filed under Section 11 of the Arbitration and Conciliation Act, 1996 seeking appointment of a Sole Arbitrator to adjudicate the disputes between the parties. The disputes between the parties have arisen in the context of:
(ii) Contract bearing No. 2017001269 for erection, commissioning, testing and performance guarantee test (hereinafter referred to as the “ECOM Contract”) for consideration of Rs.4,98,00,000/- (Rupess Four Crores Ninety Eight Lacs only) dated 26.12.2017.
2. The Arbitration Clause in the “Supply Contract” is in the following terms:
19.1 Except as otherwise provided in the Contract, any dispute concerning a question of fact arising under the Contract shall be mutually agreed upon and amicably settled by the Parties. Any other disputes, disagreements, questions or breach besides a question of fact which shall arise as to the obligation of any Party under the Contract or the interpretation of any provision thereof, if not settled by mutual agreement, shall, at the option of the initiating Party and upon written notice to the other Party, be finally settled by arbitration.
19.2 The arbitration shall take place in New Delhi, India, and shall be conducted in accordance with the Indian Arbitration & Conciliation Act 1996 including amendments and under the Laws and regulations of India. In construing and interpreting the terms and conditions of this Contract, the arbitrators shall reach their decisions in accordance with the following;
19.2.1 The literal meaning of the wording of this Contract or if ambiguous.
19.2.2 The intent of Parties as revealed by this Contract as a whole or, if still ambiguous;
19.2.3 Each Party shall bear its own expenses with respect to any arbitration and the compensation and expenses of the arbitrators shall be borne in such a manner as may be specified in the decision of the arbitrators.
19.2.4 The laws and regulations of the India effect at the time of arbitration proceedings.
19.3 From the date the dispute, disagreement or difference arises up to the date of settlement of the matter in question by arbitration, Purchaser's good faith interpretation shall prevail: and Supplier shall comply with Purchaser's good faith interpretation and shall continue to fulfill its obligations under the Contract in good faith during the pendency of any arbitration and shall not be entitled to suspend or cease the fulfillment of its contractual obligations. The arbitration decision shall be final and irrevocable and the Parties hereto expressly and unreservedly agree to be bound thereby.”
3. The Arbitration Clause in “ECOM contract” is as under:
33.1 Settlement of Disputes
All disputes, controversies, or differences, which may arise between the Contractor and the Sub-Contractor, out of or in relation to or in connection with the Contract, or for any breach thereof, shall be amicably settled by mutual conciliation between the parties hereto.
Should the parties hereto fail to settle such disputes, controversies, or differences ("Dispute") amicably within 30 (thirty) days, such Dispute shall be finally settled by arbitration in accordance with the following rule and place, the award of which shall be final and binding upon the parties hereto.
a) In case of an Indian Contractor, the arbitration proceedings shall be conducted in accordance with Indian Arbitration and Conciliation Act 1996. In case the Indian Contractor is an Indian Public Sector Enterprise/Government Department (but not a State Govt. Undertaking or Joint Sector Undertaking which is not a subsidiary of Central Govt. Undertaking), the dispute arising between the Employer and the Contractor sh
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