Court examines existence of arbitration agreement per Amendment Act; disputes on claims left to arbitral resolution.

1. Invoking S.11(6) of the Arbitration and Conciliation Act, 1996 (for short, 'the Act of 1996'), the applicant herein has filed this application for appointment of arbitrator.

2. Essential facts leading to filing of this application are as under:

2.1. The applicant had entered into an agreement on 23-7-2014 for execution of work tabled in the NIT. The applicant completed the work on the extended time and made request for payment of his bills which was finally prepared on 28-10-2016, but the bill was not paid and no claim certificate was asked which the applicant as per terms of clauses 16.(1) and 16.(2) of the general conditions of contract, submitted on 14-12-2016 and pending bill was paid on 14-12-2016 itself and security deposit was also released. Thereafter, additional claim was not paid leading to filing of application on 4-4-2017 for appointment of arbitrator before the Railways, but despite completing the formalities, arbitrator was not appointed leading to filing of this application.

2.2. Reply has been filed stating inter alia that since the applicant has signed no claim certificate, the agreement stood discharged and there is no claim and therefore the applicant is not entitled for appointment of arbitrator.

3. Mr. Harsh Wardhan, learned counsel appearing for the applicant, would submit that no claim certificate was signed as per clauses 16.(1) and 16.(2) of the general conditions of contract which provides, without execution of no claim certificate, no bill shall be paid and once no claim certificate was signed as per the conditions of contract on 14-12-2016, immediately, on that day, bills were cleared and security deposit was paid to the applicant. He would further submit that in view of the amendment in the shape of S.11(6A) of the Act of 1996 by the Arbitration and Conciliation (Amendment) Act, 2015, only the existence of arbitration agreement has to be looked into and all the defences have to be taken care of by the arbitral tribunal and the said amendment has come into force with effect from 23-10-2015. He would rely upon a very recent decision of the Supreme Court in the matter of M/s. Duro Felguera, S.A. v. M/s. Gangavaram Port Limited , 2017 SCC Online SC 1233 : AIR 2017 SC 5070 . Therefore, the application deserves to be allowed.

4. Mr. H.S. Ahluwalia, learned counsel appearing for the non - applicants, would submit that the applicant has signed no claim certificate clearly stating in itself no claim against the said contract and thus, by principle of accord and satisfaction, the applicant is not entitled for appointment of arbitrator and the application deserves to be rejected.

5. I have heard learned counsel for the parties and considered the rival submissions made hereinabove and also gone through the record with utmost circumspection.

6. At this stage, it would be appropriate to notice S.11(6A) of the Act of 1996 which has been incorporated in the Arbitration and Conciliation Act, 1996 by the Arbitration and Conciliation (Amendment) Act, 2015 with effect from 23-10-2015. Sub-section (6A) of S.11 of the Act of 1996 reads as follows:

'(6A) 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.'

7. Amended sub-section (6A) of S.11 of the Act of 1996 came up for consideration before the Supreme