O R D E R

This Arbitration Original Petition had been filed under Section

11(4) of the Arbitration and Conciliation Act, 1996 seeking to appoint a sole Arbitrator for the dispute that had arisen between the parties arising from a Memorandum of Understanding (MoU) dated 30.12.2019 and the lease agreement dated 08.01.2020

2. Heard Mr.I.Abrar Md., Abdullah, learned counsel for the petitioner and Mr.Adith Narayan Vijayaraghavan, learned counsel appearing for the respondents.

3. The learned counsel appearing for the petitioner would submit that the petitioner had entered into a MoU on 30.12.2019 with the first respondent. Pursuant to the said MoU, a registered Lease Agreement was also entered into between the parties on 08.01.2020. The object of the MoU was to establish a Maritime college for which a Lease Agreement had also been entered into. Pursuant to the said MoU, the petitioner had also approached the Directorate of General of Shipping to incorporate Maritime courses in the campus upon which statutory inspection had also been carried out by the authority on 12.08.2021 and 13.08.2021. He would submit that pursuant to certain objections pointed out by the authorities, the petitioner had approached the respondents. Since the objections raised by the authorities, were due to the action on the part of the respondents, the dispute had arisen between the parties. He would rely upon the clause F(2) of the MoU and contend that the disputes would have to be only arbitrated. He had also relied upon clause 8 of the lease agreement indicated that the lease agreement had been entered to fulfil the rights and obligations of the parties under the MoU. Hence, he would seek this Court to appoint an Arbitrator to resolve the dispute between the parties for the reason that the respondents had not complied with the obligations under the MoU.

4.Countering his arguments, the learned counsel appearing for the respondents would contend that there is no clause under the lease agreement which requires to be referred to Arbitration. He would further contend that the MoU is only between the petitioner and the first respondent and the Arbitration clause contained therein cannot be extended to the second and third respondents in their personal capacity. He would further submit that the MoU was substituted by the lease agreement dated 08.01.2020 and therefore, the arbitration clause contained in the MoU perishes with the execution of the lease agreement. Once the MoU has perished, the arbitration clause embedded in the MoU also gets perished. In view of the novation of the MoU into the lease agreement, which do not contain, the arbitration clause between the parties, the same could not be referred to arbitration and it is for the petitioner to approach the appropriate forum to seek redressal of this grievance. In that context, to drive home his contentions, he had relied upon the following judgments of the Hon'ble Apex Court:-

1) Damodar Valley Corporation vs. K.K.Kar reported in (1974) 1 SCC 141;

2) M.R.Engineers & Contractors Pvt., Ltd., vs. Som Datt Builders Ltd., reported in (2009) 7 SCC 696; and

3) NBCC (India) Ltd vs. Zillion Infra projects Pvt., Ltd reported in 2024 SCC Online SC 323

5.I have considered the rival submissions made by the learned counsel appearing on either side and perused the materials placed on record.

6.A MoU had been admittedly entered into between the parties on

30.12.2019. The said MoU had been entered into between the petitioner and the first respondent for establishing and developing the Maritime College under the brand name of “Su-Nav Maritime Academy”. The said MoU also delineates the rights and obligations of the respective parties. Thereafter, a lease agreement had also been entered into between the petitioner and the first respondent. The second respondent is the Chairman and Managing Trustee of the first respondent Trust. The second respondent herein is also a witness to the said lease agreement wherein in clause 7, the second re