A dispute resolution clause providing for conciliation rather than binding arbitration does not confer jurisdiction upon a court to appoint an arbitrator under the relevant statute. Judicial interpretation confirming a clause is non-arbitrable, once final, creates a binding bar against subsequent petitions for appointment.

Headnote:(A) Arbitration and Conciliation Act, 1996 - Section 11(6) - Appointment of arbitrator - Whether a clause stipulating conciliation and subsequent recourse to civil courts constitutes an arbitration agreement - Held, no - A clause that provides for conciliation upon dispute and vests jurisdiction in a civil court does not satisfy the requirements of an arbitration agreement.

(B) Res Judicata - Doctrine of finality - Re-litigation of previously adjudicated issues - Where a superior court has authoritatively interpreted a dispute resolution clause as a conciliation provision and the same has attained finality, parties are estopped from seeking fresh adjudication on the same issue under the guise of an arbitration petition. (Paras 24, 25, 26, 27)

Facts of the case:
The applicants filed petitions seeking the appointment of a sole arbitrator pursuant to a development agreement. The respondent challenged these petitions, asserting that the dispute resolution clause in the subject agreement had already been interpreted by a higher court, which affirmed that the clause provided for conciliation only, followed by recourse to civil courts, and not for arbitration. This interpretation was upheld by the highest court of the land.

Findings of Court:
The court observed that the nature of the clause in question had already been definitively settled by a prior judicial order which had attained finality. Consequently, the clause does not provide a mandate for arbitration, and the court possesses no jurisdiction to appoint an arbitrator under the relevant act.

Issues: The primary issue was whether a petition for the appointment of an arbitrator is maintainable when the purported arbitration clause has been judicially interpreted as a provision for conciliation rather than arbitration.

Ratio Decidendi: A dispute resolution clause providing for conciliation followed by civil litigation does not constitute a valid arbitration agreement. Once a superior court determines the true nature of such a clause, that finding binds the parties and precludes any subsequent attempts to trigger arbitration proceedings under that same clause.

Result: Petitions dismissed.

Order on Board

11/03/2026

1. Heard Mr. Sumant Das, learned Senior Advocate, Assisted by Ms. Anu Mishra and Mr. Kaif Ali Rizvi, learned counsel {for the applicant in ARBR No. 23/2024 and respondent No. 2 in ARBR 22/2024}, Mr. Rajeev Shrivastava, learned Senior Advocate assisted by Mr. Akash Shrivastava, learned counsel {for the applicant in ARBR No. 22/2024 and respondent No. 2 in ARBR No. 23/2024}, Mr. Abhishek Sinha, learned Senior Advocate assisted by Mr. Ghanshyam Patel, and Mr. Saptarshi Datta, learned counsel for the respondent-Merlin Projects Ltd.

2. By these petitions under Section 11(6) of the Arbitration and Conciliation Act, 1996 (for short, the Act of 1996), the applicants seek a relief of appointment of a Sole Arbitrator in view of the provisions of the Act of 1996 and the subsequent amendments thereof from time to time read with clause 46 of the agreement dated 16.03.2007 between the parties for resolution of the disputes arising under the said agreement.

3. The facts, as projected by the applicants are that they are owners and are in possession of various parts and parcels of the land {as detailed in paragraph 2 of the petition} situated at Kota near Hotel Piccadilly, Raipur. The applicants-Archees Real Estate and Singhania Buildcon Pvt. Ltd. entered into an agreement with the respondent-Merlin Projects Ltd. on 27.11.2005 for development of a project named ‘Singapore City’ comprising of residential and commercial buildings in the parcel of the land situated at village Kota, near Hotel Piccadilly, Raipur. The parties agreed to create a Special Purpose Vehicle (for short, the SPV) for the said work. The parties entered into a subsequent agreement dated 16.03.2007 after the lands of the applicants were freed from all encumbrances and sanction for layout and land development permissions were jointly obtained by the applicants, thus, a joint venture was created by the applicants and the respondent No. 1 in the name of "Singhania Merlin Estate". The agreement dated 16.03.2007 enumerates the formation of the joint venture as well as the conditions under which the Joint venture will operate. The relevant terms and conditions of the agreement were (a) the name of the firm was Singhania Merlin Estate (b) The actual value of the said property was agreed at a sum of Rs.160 per sq ft and the same is to be handed over in joint venture and the same was to be deposited in the account of the applicants by the respondent No. 1 as price of the said property; (c) The total land owned by and in possession of the applicants is 8,37,613 sq ft. (d) The total amount of the price of the land was fixed for a sum of Rs.13,40,18,080.00; (e) The agreement further stipulates that the land of the applicants will be treated as the capital of the applicants and the respondent No. 1 will introduce funds for commencing the work of the proposed project matching the capital of the applicants after which the proceeds from the sale of flats in the residential block of the project shall be distributed; (f) According to clause 17 of the agreement, if the respondent No. 1 fails to match the capital investment of the applicants by 30.09.2008, the respondent No. 1 will be bound to pay an interest on the balance amount at the rate of 12% p.a. to the applicants up to 31.03.2009 and the interest on the remaining amount from 01.04.2009 will be at the rate of 21% p.a.; and (g) As per the terms of the agreement all the decisions regarding the working of the joint venture will be taken by the parties in consonance with each other.

4. Apart from other obligations recorded in the agreement dated 16.03.2007, the parties in Clauses 46 of the said agreement have recorded that any dispute in between the parties and counter proceedings and hearings shall take place only at Raipur, Chhattisgarh in accordance with the provisions of the Arbitration and Conciliation Act, 1996. The applicants and the respondent No. 1, entered into a further agreement in the nature of Indenture of

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2026 Supreme(Online)(Chh) 22490

IN THE HIGH COURT OF CHHATTISGARH AT BILASPURRAMESH SINHA, CJSinghania Buildcon Private Limited – AppellantVersusMerlin Projects Limited – RespondentARBR No. 23 of 2024

IN THE HIGH COURT OF CHHATTISGARH AT BILASPUR
RAMESH SINHA, CJ
Singhania Buildcon Private Limited – Appellant
Versus
Merlin Projects Limited – Respondent
ARBR No. 23 of 2024