The presence of a party not residing in India renders the arbitration international, irrespective of other parties acting independently, and mandates jurisdiction lies with the Chief Justice of India.

JUDGMENT :

PRATEEK JALAN, J.

1. By way of this petition under Section 11 of the Arbitration and Conciliation Act, 1996 [“the Act”], the petitioner seeks appointment of an arbitrator to adjudicate disputes between the parties under a “Shareholders Agreement” dated 20.07.2018 [“the Agreement”].

2. A preliminary question arises as to whether the petition is maintainable in this Court, in view of the fact that one of the parties to the Agreement – Mr. Nicholas Valladares (arrayed as respondent No. 5 in the petition), is admittedly not a national or habitual resident of India. The question depends upon whether the proposed arbitration would constitute an “international commercial arbitration” within the meaning of Section 2(1)(f) of the Act, in which case, the power to appoint an arbitrator under Section 11(9) of the Act would lie with the Chief Justice of India or his nominee, and not with this Court.

3. There are fifteen parties to the Agreement. The petitioner is described as the “Initial Shareholder” and thirteen individuals are collectively referred to as “Subsequent Shareholders”. A company by the name of Destinos India Gurus Private Limited [“Destinos”] is also a party to the Agreement, but has not been impleaded in this petition. The purpose of the Agreement is to reorganize the shareholding of Destinos so that the petitioner and the respondents hold shares in the ratio of 30:70 respectively.

4. The Agreement contains an arbitration clause [Clause 26], which provides as follows:

“26. GOVERNING LAW AND DISPUTE RESOLUTION

26.1 This Agreement shall be governed by and construed in accordance with the laws of India. Subject to arbitration provisions provided herein below, the courts in New Delhi shall have jurisdiction in respect of any and all disputes or differences arising out of or in connection with this Agreement.

26.2 If any dispute or difference of any kind whatsoever arises between the Parties in connection with or arising out of this Agreement (and whether before or after the termination or breach of this Agreement), the Parties shall promptly and in good faith negotiate with a view to its amicable resolution and settlement by negotiation for 60 days. In the event no amicable settlement is reached within a period of 60 days from the date on which the dispute or difference arose, such dispute or difference shall be referred to a mutually accepted sole arbitrator.

26.3 In the event that the Parties fail to agree to the appointment of a sole arbitrator within 15 days, then the Parties shall jointly apply to the Court for appointment of an independent arbitrator who shall be a retired judge of a High Court. The arbitration shall be held in accordance with the Arbitration and Conciliation Act, 1996 or any statutory modification or re-enactment thereof for the time being in force.

26.4 The arbitration proceedings shall be held in New Delhi and shall be conducted in the English language.

26.5 Nothing contained in this Clause shall prevent any Party from applying to any court of competent jurisdiction for temporary or permanent injunctive relief or to enforce any of its right as under this Agreement.”

5. Disputes having arisen between the parties, learned counsel for the petitioner addressed a letter dated 30.01.2023 to each of the thirteen respondents, invoking arbitration and proposing the name of a former judge of this Court as the sole arbitrator. As the parties have failed to a