2024:BHC-AS:14828 IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION COMMERCIAL ARBITRATION PETITION NO. 16 OF 2023 Kirloskar Pneumatic Company Ltd .. Petitioner Versus Kataria Sales Corporation .. Respondent …

Mr. Sunny Shah a/w. Devanshi Sethi i/b Hemant Sethi, for the Petitioner.

Mr. Dormaan Dalal, for respondent.

CORAM: BHARATI DANGRE, J.

DATED : 21st MARCH 2024 ORAL JUDGMENT:-

1 The arbitration petition filed by the Kirloskar Pneumatic Company Ltd, seek relief of appointment of Sole Arbitrator to adjudicate the disputes with the respondent Kataria Sales Corporation, out of the Dealership Agreement dated

19/06/2013.

The Petitioner being engaged in the business of manufacturing and selling various types of air & gas compressors, accessories, spare parts and providing for after sale services of the equipment struck a deal with the respondent, which is also interalia engaged in the similar business and the business deal found its way in the Dealership Agreement.

2 Pursuant thereto purchase order raised by the respondent Kataria Sales on the petitioner Kirloskar Pneumatic Company, which raised an invoice for an amount of Rs. 14, 86,932 on 27/03/2015, but Kataria Sales refused to pay the amounts.

The above event was followed by exchange of multiple emails for almost one year with accusations being flunged at each other and explanations offered dealing with the same. However, the parties were unable to reconcile their differences.

3 One more purchase order was placed by Kataria Sales on Kirloskar Pneumatic Company for which it raised an invoice for an amount of Rs. 6,18,879/- but what was received by Kirloskar Pneumatic Company was only part payment, despite the whole amount under the purchase order becoming due and payable.

4 In this background, on 30/10/2018, Kirloskar Pneumatic Company invoked arbitration and appointed Advocate. Anurag Jain to act as a sole arbitrator.

The arbitrator on 23/11/2020 declared an award in its favour directing Kataria Sales to pay to the claimant (Kirloskar Pneumatic Company) an amount of Rs. 29,90,524/- together with interest @ 18% per annum from 22/02/2019 till payment and/or realization. Kataria Sales was also levied with cost of Rs. 4,42,500/-, together with an interest @ of 12% per annum from the date of the award till payment and/or realization.

5 This judgment however faced a challenge before the District Judge, Pune in form of Civil Miscellaneous Application No. 262 of 2021 and by judgment dated 7/01/2023, the arbitral award dated 23/11/2020, passed by the Sole Arbitrator was set aside on the ground that the Sole Arbitrator was appointed unilaterally by the claimant/ Kirloskar Pneumatic Company and in the wake of the ruling of the Apex Court in case of Perkins Eastman Architects DPC & Anr. Vs. HSCC (India) Limited (2020) 20 SCC 760, as well as the position of law as laid down in TRF Limited vs. Energo Engineering Projects Limited (2017)

8 SCC 377, such an appointment cannot be sustained.

6 It is in this background, the present application is filed by Kirloskar Pneumatic Company, seeking appointment of an Arbitrator as the disputes arising between the parties out of the dealership agreement could be resolved only through the process of arbitration.

7 I have heard learned counsel Mr. Sunny Shah for the petitioner, who would justify the prayer in the petition and seek appointment of the Sole Arbitrator in the background facts. He is opposed in his submission by Adv. Dormaan Dalal representing Kataria Sales, who would raise a preliminary objection about the maintainablity of the petition and according to Mr. Dalal it being ‘pre-mature’ since the petition is filed under Section 11 (6)

without first invoking the arbitration clause under Section 21.

According to him, the dispute commences only from the date on which the request for arbitration is received by the other side, unless otherwise agreed between the parties. According to him, the arbitration clause do not contemplate ‘re- invocation