Disputes may be referred to arbitration even when parties disagree on the identity of the arbitrator; allegations in arbitration petitions are irrelevant to the court's decision on referral.

ORDER (Oral)

(video-conferencing)

C. Hari Shankar, J.

ARB.P. 501/2021 & I.A. 5498/2021 (Section 151 CPC) O.M.P.(I) (COMM.) 117/2021

1. With consent of parties, these matters are being disposed of at this stage.

2. ARB.P. 501/2021 under Section 11 (6) of the Arbitration and Conciliation Act, 1996 ("1996 Act"), seeks appointment of an arbitrator to arbitrate on the disputes between the parties. Dr. George, learned counsel for the petitioner, has invited my attention to a communication dated 1st April, 2021, by the respondent through counsel, in response to the notice invoking arbitration, issued by the petitioner. A reading of this letter indicates that the respondents were agreeable to the disputes being referred to arbitration, but were not agreeable to arbitration by the arbitrator suggested by the petitioner. The respondents, in their reply, therefore, suggested the name of another arbitrator, with which the petitioner is not in agreement.

3. Accordingly, it appears that the contest between the parties insofar as referring the disputes to arbitration is concerned, is only with respect to the identity of the arbitrator.

4. Mr. Jagdev Singh, learned counsel for the respondents, however, points out that there are several allegations against the respondents levelled in the present arbitration petition, to which his clients object.

5. I have expressed an opinion in earlier orders passed by me, that the allegations should form no part of the pleadings in petitions under Section 11 of the 1996 Act, which are only intended to refer disputes to arbitration. The Court is least concerned, in such cases, with the correctness or otherwise of allegations and counter allegations between the parties. As such, this Court makes it absolutely clear that it is expressing no opinion whatsoever on any allegations, which may be contained in this petition and that the respondents would be at liberty to traverse the said allegations by all means known to law, in the arbitral proceedings.

6. The respondents would also be at liberty, should they so choose, to prefer any Counter-Claim before the learned Arbitral Tribunal in accordance with law.

7. Dr. George submits that the claims, in this case, may be in the vicinity of Rs.100 crores.

8. In view thereof, this Court requests Hon'ble Ms. Justice Indu Malhotra (Cell No.9810026757 and Email ID: indu.malhotra@gmail.com), an eminent retired judge of the Supreme Court of India to arbitrate on the disputes between the parties.

9. The learned arbitrator would be entitled to charge fees in accordance with the Fourth Schedule to 1996 Act or as otherwise fixed in consultation with the parties.

10. The learned arbitrator is also requested to furnish the requisite disclosure under Section 12(2) of the 1996 Act within a week of entering on reference.

11. ARB.P. 501/2021 stands disposed of in the above terms.

I.A. 5498/2021 (Section 151 CPC) in ARB.P. 501/2021

12. In view of the order passed in the petition, this application is disposed of.

O.M.P.(I) (COMM.) 117/2021

13. Learned counsel for the parties, ad idem, agree that this petition may be treated as an application under Section 17 of the 1996 Act and referred to the learned arbitrator for decision, in accordance with the said provision.

14. It is ordered accordingly.

15. The learned arbitrator, in deciding this petition as an application under Section 17 of the 1996 Act, may proceed uninhibited and uninfluenced by any observation made by this Court in any of the orders passed in this application.

16. O.M.P.(I) (COMM.) 117/2021 also stands disposed of in the aforesaid terms.