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2025 Supreme(Gau) 2070

IN THE GAUHATI HIGH COURT, (HIGH COURT OF ASSAM, NAGALAND, MIZORAM & ARUNACHAL PRADESH)
(PRINCIPAL SEAT)
SOUMITRA SAIKIA, J.
M/S NES Digboi Bogapani (177804), A proprietorship concern, represented by its Proprietor, Mrs. Ranjita Dhanowar – Petitioner 
Versus
Bharat Petroleum Corporation Limited, Represented by Territory Manager, Retail Bharat Petroleum Corporation Limited – Respondents
ARB. PET No. 6 of 2025 
Decided On : 16-12-2025

Advocates Appeared:
For the Petitioner:Mr. G.N Sahewalla, Sr Advocate Assisted by Mr. M Sahewala, Adv.
For the Respondents: Mr. S.S Roy, CGC Mr. S Borthakur, Adv.

Parties must adhere to agreed arbitration procedures; failure to do so precludes judicial appointment of an arbitrator under Section 11(6) of the Arbitration and Conciliation Act.

Headnote:(A) Arbitration and Conciliation Act, 1996 - Section 11(6) - Agreement for arbitration - The petitioner was granted a dealership agreement by BPCL, including an arbitration clause mandating SCOPE Forum procedures. The court held that the petitioner failed to comply with the procedure for initiating arbitration, leading to dismissal of the arbitration petition. (Paras 3, 4, 12, 19, 21)

(B) Jurisdiction - Parties must follow agreed procedure for appointment of arbitrators - The court ruled that absence of dispute regarding the arbitration clause does not negate the necessity to adhere to the agreed procedure for resolving disputes through arbitration. Until the parties comply, court intervention under Section 11(6) is unwarranted. (Paras 18, 20, 21)

Facts of the case:
The petitioner operated a petrol pump under a dealership agreement but faced termination following purported failures in the dispensing unit. Despite legal challenges, no arbitration was initiated as per the prescribed rules under the SCOPE Forum as required by the agreement.

Findings of Court:
The court found the petitioner did not satisfy the requirements to invoke Section 11(6) due to non-compliance with the arbitration procedure stated in the agreement.

Issues: Whether the court can appoint an arbitrator under Section 11(6) without adherence to the established arbitration agreement process?

Ratio Decidendi: The court concluded that the arbitration clause is binding and failure to honor the agreed procedure precludes the ability to seek an arbitrator's appointment through the court.

Result: Petition dismissed.

Table of Content
1. dealership agreement details and issues. (Para 2 , 3)
2. arbitration mechanism triggered by disputes. (Para 4 , 5)
3. requirements for arbitration appointment under section 11. (Para 6 , 19)
4. procedural compliance critical for arbitration. (Para 7 , 8 , 18)
5. court's analysis of ongoing and prior litigations. (Para 10 , 11 , 12 , 13)
6. scope forum structure and arbitration protocol. (Para 14 , 15 , 16)
7. court's dismissal of petition for non-compliance. (Para 17 , 20 , 21)
8. final dismissal of arbitration petition. (Para 22)

JUDGMENT :

SOUMITRA SAIKIA, J.

Heard Mr. GN Sahewalla, learned Senior Counsel assisted by Mr. M Sahewalla, learned counsel for the petitioner. Also heard Mr. S Borthakur, learned counsel and Mr. SS Roy, learned CGC for the respondent.

2. The petitioner before this Court was awarded dealership of Dispensing Pump and Selling License by respondent company by execution of proper agreement dated 28.03.2023. By the said agreement, the petitioner had been running a petrol pump at Tingrai Gaon, Tinsukia since the year 2008. On the basis of a dealership granted to the petitioner by Numaligarh Refinery Limited (hereinafter referred to as “NRL”), the NRL was taken over by BPCL in the year 2012 whereupon a fresh agreement was entered by and between the petitioner and BPCL for running the patrol pump. In the year 2023, there was some persistent malfunctioning in the dispensing unit of the petitioner’s petrol pump. This dispensing unit was installed and maintained by M/S Gilbarco Vedder Root (GVR) which was 3rd Party vendor appointed by the BPCL and who supplied the dispensing unit for the petrol pump. The internal parts of the dispensing units were sent to GVR for testing wherein it was found that the dispensing unit had been manipulated and tampered with.

3. It is the petitioner's case that the Legal Metrology Department, Government of Assam had inspected the dispensing unit as a whole and issued a certificate ruling out any irregularity or tampering in a dispensing unit. However, a show-cause notice dated 22.01.2024 was issued to the BPCL asking them to show cause as to why the dealership agreement should not be cancelled. The petitioner although replied to the show-cause notice, however, subsequently approached the Court of Civil Judge (Senior Division)-cum-Commercial Court, Kamrup (Metro) under Section 9 of the Arbitration and Conciliation Act, 1996 praying for an interim protection restraining the BPCL, namely, the respondent from terminating the dealership agreement. The Commercial Court by order dated 03.07.2024 granted an interim injunction to the petitioner restraining the BPCL from taking any coercive action. The agreement executed by and between the petitioner and the respondent contained a clause being Clause- 19 which provided for settling any disputes and differences arising between the parties by appointment of an arbitrator. The petitioner therefore issued a notice dated 15.07.2024 calling upon the respondents to appoint an Arbitrator. However, the respondent did not reply to the notice issued. Meanwhile, since the respondent did not appear before the Commercial Court on subsequent dates, the interim injunction granted by the Commercial Court was made absolute by order dated 07.09.2024. The respondent authority thereafter filed an appeal before the Appellate Court of the Commercial Courts Division, namely, the Court of the Additional District Judge No. 2, Kamrup (Metro) whereupon the appellate Court stayed the order passed by the Commercial Court dated 07.09.2024 by order dated 05.12.2024 on the ground that the order was obtained without presenting the correct and true facts and circumstances of the case. Being aggrieved, another second appeal was filed before the Commercial Appellate Division Gauhati High Court being Comm. App. Div. 1/2025. The Division Bench of this Court from the question of maintainability of the second appeal, dismissed the same on the grounds and reasons mentioned in

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