The court's jurisdiction under Section 11(6) of the Arbitration and Conciliation Act, 1996 is limited to confirming the existence of an arbitration agreement, not its validity.

Order :

(ANOOP KUMAR DHAND, J.)

1. The instant arbitration application has been submitted by the applicant-company under Section 11(6) of the Arbitration and Conciliation Act, 1996 (for short ‘Act of 1996’) seeking appointment of Sole Arbitrator to resolve/settle the dispute arose between the parties.

2. Learned counsel for the applicant submits that there is an arbitration clause in the loan agreement i.e. Clause 12 executed between the parties. Counsel submits that in terms of the said clause, appropriate orders be passed. Clause 12 of the loan agreement reads as under:-

“12. Arbitration, Jurisdiction & Governing Law:
12.1 All claims, disputes or differences whatsoever which may at any time hereafter arise between the parties hereto concerning this agreement or its construction of effect or as to the rights, duties, obligations of liabilities of the parties hereto or either or them under or by virtue of or in connection with this agreement or any document executed or security created pursuant thereto or otherwise as to any other manner in any way connected with or arising out of or in relation to the subject matter to this agreement (including, without limitation, enforcement of security) shall be referred to the arbitration of a sole arbitrator appointed by the company. The arbitration shall be conducted in accordance with and subject to the provisions of the arbitration & conciliation act, 1996 or any statutory modification or re- enactment thereof for the time being in force. The place of arbitration shall be as mentioned in serial no (15) of the schedule
12.2 The provision of this agreement relating to arbitration shall not prejudice the companys rights to take criminal proceedings against the borrower and/or any other proceedings which would by their nature not be subject to the arbitration provisions of this agreement.
12.3 This agreement and the relationship between the parties shall be governed by and interpreted in accordance with the laws of India.”

3. Counsel for the respondents has no objection if the dispute is referred to the Sole Arbitrator.

4. Heard counsel for the parties and perused the material available on the record.

5. It is the case of the applicant that both the applicant and non-applicant entered into a loan agreement on 14.09.2017 and accordingly, a sum of Rs.1,65,00,000/- was provided to the non- applicant and the same was supposed to be repaid in 84 months installments of Rs.4,95,000/- commencing from October, 2017. It is pleaded in the application that, default was made by the non- applicant in payment of the installments. Hence, dispute has arose between the parties which may be referred to the Arbitrator. This Court being a referral court while dealing with application of Arbitrator, exercises its jurisdiction in a narrow compass in the light of the provisions contained under Section 11(6)A of the Act of 1996 which reads as under:

“The Supreme Court or, as the case may be, the High Court, while considering any application under sub-section (4) or sub-section (5) or sub-section (6), shall, notwithstanding any judgment, decree or order of any Court, confine to the examination of the existence of an arbitration agreement.”

6. The scope of this Court, while dealing with arbitration application under Section 11(6)(A) of the Act of 1996 is confined to the examination of existence of an arbitration agreement in terms of Section 7 of the Act of 1996. Hon’ble Apex Court in the case of SBI General Insurance Company Ltd. vs. Krish Spinning while deciding Civil Appeal No.7821/2024 arising out of the SLP Civil No.3792/2024 has dealt with the scope and, jurisdiction of High Court while dealing with the arbitration application in context of Section 11(6)A clause of the Act of 1996 and i