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IN THE HIGH COURT OF DELHI AT NEW DELHI
Chandra Dhari Singh, J.
Interglobe Technology Quotient Pvt. Ltd. – Appellant
Versus
Ruby Tour Services Pvt. Ltd. – Respondent
Arb.P. 420 of 2022
Decided On : 10-04-2023
Arbitration Act - Appointment of Sole Arbitrator - Section 11(6) - Clause 8(i) of the Standard Subscriber Agreement - Arbitration and Conciliation Act, 1996 - [Clause 8(i) of the Standard Subscriber Agreement, Section 11(6) of the Arbitration Act] - The court referred the disputes between the parties to a Sole Arbitrator as per the Arbitration Clause in the Standard Subscriber Agreement, emphasizing the spirit of the Arbitration Act and the fulfilment of necessary requisites for appointment of an arbitrator.
Fact of the Case:
The petitioner sought appointment of a Sole Arbitrator to adjudicate disputes arising from a Standard Subscriber Agreement with the respondent. The respondent failed to appear despite multiple attempts to serve, leading the court to proceed with the matter with the assistance of the petitioner and the pleadings on record.
Finding of the Court:
The court found that the disputes between the parties were arbitrable in nature and that all necessary requisites for appointment of an arbitrator under Section 11(6) of the Arbitration Act were met. Emphasized the spirit of the Arbitration Act to make the resolution process accessible, easier, and more efficient.
Issues: Appointment of Sole Arbitrator, Adjudication of Disputes, Non-appearance of Respondent, Compliance with Arbitration Clause
Ratio Decidendi: The court emphasized the importance of fulfilling necessary requisites for appointment of an arbitrator under the Arbitration Act and the spirit of the Act to make the resolution process accessible, easier, and more efficient.
Final Decision: The court referred the disputes between the parties to a Sole Arbitrator and appointed Justice Kailash Gambhir as the sole arbitrator to adjudicate the disputes under the Standard Subscriber Agreement.
ORDER
Chandra Dhari Singh, J. (Oral)--The instant petition under Section 11(6) of the Arbitration and Conciliation Act, 1996 (hereinafter "Arbitration Act") has been filed on behalf of petitioner seeking appointment of a Sole Arbitrator to adjudicate the disputes between the parties.
2. The matter was first listed on 4th April 2022 before the Predecessor Bench whereby the Notice of the petition was issued to the respondent. Thereafter, on several dates of hearing, attempts were made to serve the respondent, however, the Notice remain unserved. Subsequently, on 10th October 2022, the learned counsel for the petitioner prayed that respondent be served by way of publication and accordingly, the Predecessor Bench directed service to the respondent by of the publication in the newspaper `Times of India., English Edition, and `Pune Mirror., Marathi Edition. Even thereafter, none entered appearance on behalf of the respondent either before the Court or by way of filing any pleading and ultimately, the right of the respondent to file a reply was also closed.
3. None has ever appeared in the matter on behalf of the respondent. Today also there is no appearance on behalf of the respondent.
4. Since for the past year, multiple attempts have been made to serve the respondent, yet the respondent has not appeared, this Court is left with no option but to proceed with the matter with the assistance of the petitioner and the pleadings on record.
5. A perusal of the record reveals that the petitioner is engaged in the business of distribution of Computerized Reservation System and provides necessary support, equipment and upfront advances required for operating business activated through `Galileo System' in India. The respondent approached the petitioner to use the Galileo System at their sole Computerized Reservation System and expressed its intent to enter into a Subscriber Agreement with the petitioner for the said purpose.
6. Accordingly, the parties entered into a Standard Subscriber Agreement on 1st January 2010. However, subsequently, disputes arose between the parties arising out of the said Agreement, whereupon, the petitioner, seeking dispute resolution, invoked the Arbitration Clause 8(i) of the Agreement and furnished a Notice under Section 21 of the Arbitration Act upon the respondent on 23rd March 2021. Since, no sufficient reply was received on behalf of the respondent to the said Notice and the name of an arbitrator was also not suggested by it, the petitioner moved this Court seeking appointment of an Arbitrator by this Court for the adjudication of disputes between the parties.
7. The learned counsel for the petitioner submitted that when the respondent approached the petitioner for entering into a Subscriber Agreement, the respondent assured and committed that minimum target segments as per the Agreement will be achieved. It is submitted that achieving the minimum target segments is the essence of the Subscriber Agreement as well as of the three addendums subsequently entered into. To facilitate the achievement of the minimum target segments, the petitioner remitted the amount of upfront advance of Rs.30 Lakhs on 1st January 2010, Rs.30 Lakhs on 1st January 2012, Rs.45 Lakhs on 1st January 2013 and Rs.32 Lakhs on 1st January 2016. However, the respondent failed to meet their commitment of achieving the minimum target segments. It is submitted that a total payment of Rs.1,29,86,809/- had been paid by the petitioner to the respondent.
8. It is submitted that due to the failure on part of the respondent to meet the targets, there was a shortfall of 52,981 segments for the period from January 2010 to December 2020. Moreover, the respondent also breached the Subscriber Agreement since it was using GDSs other than the Galileo System for conducting their business.
9. It is submitted that ultimately, the petitioner issued a Demand Notice dated 4th September 2020 calling upon the respondent to refund a sum of Rs.3,18,
Unilateral appointment of an arbitrator is impermissible; both parties must mutually consent to ensure impartiality in dispute resolution.
The court's authority to appoint a sole arbitrator under Section 11(6) of the Arbitration and Conciliation Act, 1996.
Premature petitions under Section 11 of the Arbitration and Conciliation Act, 1996, are not maintainable when a Sole Arbitrator has already been appointed, and unresponsiveness of the current Arbitra....
The court emphasized the arbitrability of disputes and the appointment of a sole arbitrator under Section 11 of the Arbitration and Conciliation Act, 1996.
The main legal point established in the judgment is the court's authority to refer disputes to arbitration when both parties have invoked the arbitration clause and there are admitted arbitral disput....
The court's decision emphasized the arbitrability of disputes and the appointment of a sole arbitrator under the Arbitration and Conciliation Act, 1996.
A court, under sections 11(5) and (6) of the Arbitration and Conciliation Act, is obligated to appoint an arbitrator when a valid arbitration clause exists and the other party does not oppose the pet....
The court upholds the arbitration clause in the agreement and appoints a sole arbitrator to resolve disputes.
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