Case Note & Summary
The applicant, National Commodity and Derivatives Exchange Ltd. (NCDEL), a stock exchange, filed an application under Section 11 of the Arbitration and Conciliation Act, 1996, seeking appointment of an arbitrator to resolve disputes arising out of an agreement dated 18 July 2008 with the respondent, Indian Exchange of Metal Ltd. The agreement contained an arbitration clause (Clause IV(12)) which provided that any dispute or difference between the parties arising out of or in relation to the agreement shall be referred to an arbitral tribunal, with each party nominating an arbitrator and the two arbitrators appointing a third presiding arbitrator. The venue of arbitration was to be Mumbai, and all matters arising out of such arbitration were subject to the exclusive jurisdiction of Mumbai courts. The applicant invoked the arbitration clause and called upon the respondent to appoint an arbitrator, but the respondent failed to do so. The respondent filed a reply resisting the application on all counts but did not dispute the existence of the arbitration agreement or the court's jurisdiction. The court noted that there was no specific issue regarding jurisdiction and that the arbitration clauses themselves provided that the Bombay High Court had exclusive jurisdiction. The court held that since there was an arbitration agreement and the respondent had not appointed an arbitrator despite notice, the applicant was entitled to the appointment of an arbitrator. The court allowed the application and appointed a sole arbitrator to adjudicate the disputes between the parties, with the arbitrator's fees to be fixed in consultation with the parties. The court also directed that the arbitrator shall be entitled to decide all issues including the issue of limitation, if any.
Headnote
A) Arbitration Law - Appointment of Arbitrator under Section 11 - Arbitration and Conciliation Act, 1996, Section 11 - The applicant, a stock exchange, sought appointment of an arbitrator under Section 11 of the Act based on an arbitration clause in the agreement dated 18 July 2008. The respondent resisted the application but did not dispute the existence of the arbitration clause or the court's jurisdiction. The court held that since there is an arbitration agreement and the respondent failed to appoint an arbitrator despite notice, the applicant is entitled to the appointment of an arbitrator. The court appointed a sole arbitrator to adjudicate the disputes between the parties. (Paras 1-4)
Issue of Consideration
Whether the applicant is entitled to appointment of an arbitrator under Section 11 of the Arbitration and Conciliation Act, 1996, given the arbitration clause in the agreement dated 18 July 2008.
Final Decision
The court allowed the application and appointed a sole arbitrator to adjudicate the disputes between the parties. The arbitrator's fees shall be fixed in consultation with the parties. The arbitrator shall be entitled to decide all issues including the issue of limitation, if any.
Law Points
- Section 11 of the Arbitration and Conciliation Act
- 1996
- Arbitration clause
- Appointment of arbitrator
- Exclusive jurisdiction of Mumbai courts
