271 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH ARB-404-2025 Date of decision: 16.02.2026 PUNJAB AGRO FOODGRAINS CORPORATION LTD. AND ANOTHER ...Applicant(s)

VERSUS M/S NANAK RICE AND GENERAL MILLS AND ANOTHER ...Respondent(s)

CORAM: HON'BLE MR. JUSTICE JASGURPREET SINGH PURI Present:- Mr. Somesh Gupta, Advocate for the applicants.

Mr. Mukand Gupta, Advocate for respondent No.1.

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JASGURPREET SINGH PURI, J. (Oral)

1. The present application has been filed under Section 11(5) and (6) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as ‘the Act’) seeking appointment of an independent Arbitrator to adjudicate the disputes and differences which have arisen between the parties.

2. Learned counsel for the appellants submitted that there was an agreement between the parties vide Annexure P-1 containing an arbitration clause i.e. Clause 26, which provides for appointment of an Arbitrator. He further submitted that the applicant, which is a Procurement Agency had appointed an Arbitrator who passed an award but thereafter, when the respondents filed the objections under Section 34 of the Act, the same were allowed vide judgment dated 18.08.2022 (Annexure P-3) on the ground that the Arbitrator was an interested party and could not have been appointed as an Arbitrator and therefore, the arbitral award itself was set aside. He further submitted that it was thereafter that a notice was issued to the respondents vide Annexure P-5 dated 13.11.2024 for fresh appointment of a Sole Arbitrator, to which the respondents filed a reply stating that there was no necessity to appoint an Arbitrator because there is no dispute left for adjudication and also on the ground that Section 11 is barred by res judicata. He further submitted that the aforesaid plea was not available with the respondents because once the arbitral award has been set aside on the ground that the Arbitrator was an interested party, which is violative of public policy, then a fresh Arbitrator is required to be appointed as neither there is any other remedy available with the applicant because of the existence of an arbitration clause nor the applicant can file a civil suit in this regard and therefore, any independent Sole Arbitrator may be appointed by this Court.

3. On the other hand, learned counsel for respondent No.1 submitted that there is no dispute with regard to the existence of the aforesaid agreement, arbitration clause and invocation of the said arbitration clause by way of issuance of notice vide Annexure P-5, to which respondent No.1 had filed a reply. He has however submitted that this Court may not appoint an Arbitrator in the present case as the said agreement is of the year 2013, which had its validity for only nine months and since the validity has already expired, no such Arbitrator can be appointed. He further submitted that there is no monetary dispute between the parties. He also submitted that the present application is barred by res judicata since earlier also an Arbitrator was appointed but the award was set aside by the learned Additional District Judge, Chandigarh vide Annexure P-3 on the ground that the Arbitrator was an interested party because the said Arbitrator was the Legal Advisor of the applicants themselves.

4. I have heard the learned counsels for the parties.

5. There is no dispute with regard to the existence of the aforesaid agreement, the arbitration clause and invocation of the said arbitration clause by way of issuance of notice vide Annexure P-5. However, an objection was raised by the learned counsel for respondent No.1 that the agreement is of the year 2013, which was valid only for nine months and all the disputes have already been settled between the parties and therefore, there is no requirement of appointment of a fresh Arbitrator. This submission made by the learned counsel for respondent No.1 is not sustainable in view of the fact that it is a settled law that at the stage of reference under Section 11 o