The initiation of arbitration is impermissible due to an existing moratorium that restrains all legal proceedings, including arbitration, until the related insolvency matters are resolved.

JUDGMENT

V. Kameswar Rao, J.

1. The present petition has been filed under Section 11 of the Arbitration and Conciliation Act, 1996 ("Act of 1996", hereinafter) seeking appointment of a sole arbitrator for the resolution of disputes between the parties under a Contract dated June 21, 2012.

2. At the outset, I may briefly narrate the facts which have lead to the filing of the present petition. The petitioner entered into a cost sharing agreement with Haryana Urban Development Authority ("HUDA", hereinafter), for external development works for improvement of certain road networks in Gurgaon, Haryana. The respondent presented itself as a prominent infrastructure development company to the petitioner and based on its representation, the petitioner awarded development works to be carried out in the project to the respondent.

3. Subsequently, the petitioner entered into a separate contract agreement dated June 21, 2012 ("contract", hereinafter) with the respondent. The term of the contract period was for 24 months and total price of the contract was Rs.394,30,00,000/-. However, the said project was not completed because of various defaults on the part of the respondent, and the project timelines were extended till June 30, 2017. A major portion of the works were de-scoped, vide agreement dated May 11, 2018 as the respondent was unable to complete the work on time and further did not carry out the maintenance works; which in terms of the contract, the respondent was liable to do for five years. The maintenance work of the project is still ongoing and is being carried out through some other agencies at the risk and cost of the petitioner. Due to the delay caused by the respondent, and the subsequent de-scoping, the petitioner incurred additional expenses. The respondent also failed to adhere by the quality and safety norms set out in the agreement and the petitioner even imposed a fine on the respondent for its failure to adopt the safety measures in terms of the contract.

4. In November 2018, disputes arose between the petitioner and the respondent in relation to certain works to be completed/rectified by the respondent with respect to the construction of a culvert near AIT Chowk and Belmonte of HUDA sector road. There were several issues raised by the petitioner regarding the safety of the said culvert highlighting that it had become an accident prone area. Several correspondences were exchanged between the petitioner and the respondent wherein the petitioner time and again called upon the respondent to cure the defects in the area but the respondent has repeatedly failed to comply with the requests made by the petitioner.

5. Meanwhile, the Union of India filed a petition under Sections 241 and 242 of the Companies Act, 2013 before the National Company Law Tribunal ("NCLT"), Mumbai, inter alia praying for stay of institution of suits and arbitral proceedings against Infrastructure Leasing and Financial Services Limited ("IL&FS"), i.e., the parent company of the respondent, and its 348 Group Companies. However, the NCLT, Mumbai declined the said relief. Thereafter, the Union of India filed an appeal before the National Company Law Appellate Tribunal ("NCLAT") challenging the order passed by the NCLT, Mumbai. The NCLAT on October 15, 2018 passed an interim order staying the institution of suits and other proceedings against IL&FS and its 348 Group Companies.

6. Subsequently, the respondent issued a demand notice dated Jul