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2023 Supreme(Del) 945
IN THE HIGH COURT OF DELHI AT NEW DELHI
Chandra Dhari Singh, J.
Ado India Pvt. Ltd. – Appellant
Versus
Ats Housing Private Limited – Respondent
Arb.P. 1432 of 2022
Decided On : 24-03-2023
Ms. Ritu Singh Mann, (Through VC) and Mr. Dheeraj K. Garg, Advocates, for the Petitioner.
Mr. Kunal Kher, Advocate, for the Respondent.
The main legal point established in the judgment is the court's inclination to refer parties to arbitration for resolution of their disputes when there exists an arbitration clause, consensus on the arbitrability of the disputes, and compliance with necessary procedures for invoking arbitration proceedings.
Headnote:
Arbitration - Appointment of Sole Arbitrator - Section 11(5) of the Arbitration and Conciliation Act, 1996 - 12(1) of the Arbitration and Conciliation Act, 1996
Fact of the Case:
The petitioner, a registered company, sought appointment of a sole arbitrator to adjudicate disputes arising from a work order with the respondent. The respondent opposed the petition, claiming no amount was due and payable. The petitioner had initially approached the Ministry of Micro, Small & Medium Enterprises (MSME) Council for redressal, but later withdrew and invoked the Arbitration Clause 1.18 of the Standard Terms & Conditions for ATS Housing Pvt. Ltd.
Finding of the Court:
The court found that the disputes between the parties were arbitrable in nature and that the petitioner had followed the necessary procedures for invoking arbitration proceedings. The court, therefore, referred the parties to a sole arbitrator for resolution of their disputes.
Issues: The issues revolved around the invocation of the Arbitration Clause, withdrawal from the MSME Council, and the objection raised by the respondent regarding the procedure followed for invoking the arbitration proceedings.
Ratio Decidendi: The court's decision was influenced by the existence of an arbitration clause, consensus on the arbitrability of the disputes, and the petitioner's compliance with the necessary procedures for invoking arbitration proceedings.
Final Decision: The court appointed Mr. Vineet Dhanda as the sole arbitrator to adjudicate the disputes between the parties, ensuring compliance with Section 12(1) of the Arbitration and Conciliation Act, 1996, and directed the parties to appear before the arbitrator within 10 days.
ORDER
Chandra Dhari Singh, J. (Oral)
I.A. 5759/2023 (Delay)
1. By way of this application under Section 151 of the Code of Civil Procedure, 1908, the respondent seeks condonation of delay in filing the reply.
2. For the reason stated in the application, the delay of 4 days in filing the reply is condoned.
3. The application is disposed of.
ARB.P. 1432/2022
4. The instant petition under Section 11(5) of the Arbitration and Conciliation Act, 1996 has been filed on behalf of petitioner seeking the following reliefs:
"(i) Appoint any person as this Hon'ble Court may deem fit and proper, as the Sole Arbitrator to adjudicate and decide all disputes that have arisen between the Petitioner and Respondent in relation to the Work Order No. WOJPR/0006/16-17 dated 20.10.2016, read with Term and Conditions contained therein;
(ii) pass an order for costs of the Petition..."
5. The petitioner is a duly registered Company, being a part of the multinational ADO Group, which is involved in the business of manufacturing UPVC windows and doors systems and providing services for installation of its products as per the requirement of its customers. The respondent is a real estate company/builder engaged in business of construction, providing services related to development and construction of flats in housing projects, office spaces, shops, residential plots.
6. The learned counsel appearing on behalf of the petitioner submitted that the respondent approached the petitioner to supply UPVC doors and windows for its project "ATS PRISTINE, SC 01/A-l, Sector-150, Noida". Consequently, both the parties entered into the Agreement/Work Order dated 20th October, 2016. The terms for supply, including the payment terms, were negotiated and the respondent placed upon the petitioner Work Order No. WOJPR/0006/16-17 dated 20th October, 2016 for Rs.1,77,59,129.96/-.
7. Learned counsel appearing on behalf of petitioner submitted that the petitioner supplied entire goods as per the terms of the Work Order, completed the installation and handed over the project to the respondent. Thereafter, the petitioner claimed the balance amount for the work, as per the terms of the Work Order. Despite repeated requests and reminders, the respondent failed to respond to the petitioner. It is submitted that the respondent failed to make payment towards the balance amount and all the dues still remain uncleared.
8. The learned counsel submitted that subsequently, the petitioner approached the Ministry of Micro, Small & Medium Enterprises (hereinafter "MSME") Council on 15th January, 2021 for redressal of the disputes arisen between the parties. It is submitted that after a span of time, the petitioner realized that it was not eligible to approach the MSME Council as the Work Order No. WOJPR/0006/16-17 was executed between the petitioner and the respondent on 20th October, 2016, that is, prior to the petitioner's MSME registration. Accordingly, vide email and letter dated 1st December, 2022, the petitioner withdrew its claim filed before MSME Council while reserving its right to invoke the Arbitration Clause 1.18 of the Standard Terms & Conditions for ATS Housing Pvt. Ltd.
9. It is submitted that the petitioner, thereafter, served the Notice dated 22nd October 2022 upon the respondent for invocation of Arbitration Clause and initiation of arbitration proceedings. Since the respondent failed to take any actions in pursuance of the aforesaid Notice, the petitioner prays that an arbitrator be appointed to adjudicate upon the disputes between the parties.
10. The learned counsel appearing on behalf of the respondent vehemently opposed the instant petition on merits and submitted that there is no amount due and payable by the respondent to the petitioner. It is submitted that the instant petition is liable to be dismissed on the ground that the petition is based on false, frivolous and unsubstantiated facts and claims.
11. It is submitted that the invocation of Arbitration Clause
