IMPORTANT POINT
Appointment of sole Arbitrator – Arbitration clause contained in agreement cannot be invoked where Arbitral Tribunal has already been appointed.

JUDGMENT :

1. The Applicant Balasore Alloys Limited is before this Court in this petition filed under Section 11(6) read with Section 11(12)(a) of the Arbitration and Conciliation Act, 1996 (‘Act, 1996’ for short) praying that a sole arbitrator be appointed to adjudicate upon all disputes that have arisen between the parties in connection with the 37 purchase orders referred to in the application. Alternatively, it is prayed that the second arbitrator be appointed on account of the failure of the respondent - Medima LLC to nominate an arbitrator in terms of the contracts.

2. The applicant is a manufacturer of High Carbon Ferro Chrome. The applicant and the respondent accordingly, entered into transactions whereby the applicant agreed to supply the High Carbon Ferro Chrome manufactured by them to the respondent for sale of the same in the territory of USA and Canada. Initially an Agreement dated 19.06.2017 limited to the sale of 2000 MT was entered into. Pursuant to such transaction 37 purchase orders were placed by the respondent in favour of the applicant specifying details of the supply to be made under each of the purchase orders. The parties had also entered into an Agreement dated 31.03.2018 relating to the same transaction whereunder certain terms as enumerated therein were agreed upon. In respect of the said transactions certain disputes have arisen between the parties which is required to be resolved through arbitration.

3. The applicant, therefore, while seeking for appointment of an arbitrator to resolve such disputes has sought to rely on Clause-7 in the said 37 purchase orders providing for resolution of disputes through arbitration by the Arbitral Tribunal to be constituted as provided therein. Since according to the applicant, the respondent had failed to appoint their arbitrator, despite the petitioner having nominated Mr. Justice Amitava Lala, Retired High Court Judge, the applicant is before this Court seeking the appointment of an arbitrator.

4. The respondent, on being notified in this petition has entered appearance and filed its detailed counter affidavit. The nature of transaction entered into between the parties is not disputed. The fact that certain arbitrable disputes have arisen between the parties is also not controverted. However, it is the case of the respondent that the entire transaction is governed under the Agreement dated 31.03.2018 which is referred to by the respondent as an “Umbrella Agreement”. It is their further case that the said agreement dated 31.03.2018 vide Clause-23 thereof provides for resolution of disputes through arbitration in the manner as indicated therein and as such the respondent had already invoked the same by issue of notice. Further, as per the procedure contemplated in Clause-23 the respondent had filed a petition before the International Chamber of Commerce (‘ICC’ for short) and the Arbitral Tribunal has been duly constituted. The respondent, therefore, contends that the instant application filed by the applicant seeking appointment of the Arbitral Tribunal in terms of Clause-7 of the purchase order is not bonafide; the application is liable to be dismissed. The applicant has filed the rejoinder to the counter affidavit filed on behalf of the respondent whereby the contentions put forth by the respondent is sought to be disputed and the averments in the application are reiterated.

5. In the above background, we have heard Shri Maninder Singh, learned senior counsel for the applicant, Shri S.N. Mookherjee and Shri Ritin Rai, learned senior counsel for the respondent and perused the application papers.

6. Having taken note of the averments contained in the pleading and the contentions urged by the learned senior counsel for the respective parties, it is evident that the parties having entered into a business transaction; certain disputes have arisen between them which is to be resolved through arbitration. To that extent the parties are also in agreement. The issue for consi