Case Note & Summary
The petitioners, M/s. Efkon (India) Pvt. Ltd. and ELogistics Pvt. Ltd., filed an application under Section 11 of the Arbitration and Conciliation Act, 1996, seeking appointment of a sole arbitrator to resolve disputes arising from an agreement dated 12th November 2009 executed between petitioner no. 2 and respondent no. 2 (Department of Post, India). The agreement contained an arbitration clause (Clause 23). Disputes arose, and the petitioners issued a notice invoking arbitration on 9th May 2012. They had earlier filed Writ Petition No. 319 of 2012, which was withdrawn on 23rd February 2012 with liberty to invoke arbitration. The present application was filed thereafter. The respondents opposed the application, arguing that the agreement had been terminated and that the arbitration clause did not survive. The court, after hearing arguments, held that the arbitration clause is independent and survives termination of the contract. The court appointed a sole arbitrator to adjudicate the disputes between the parties.
Headnote
A) Arbitration Law - Appointment of Arbitrator - Section 11 of Arbitration and Conciliation Act, 1996 - Survival of Arbitration Clause - Dispute arose from termination of agreement dated 12th November 2009 between petitioner and respondent - Court held that arbitration clause is independent and survives termination of contract - Appointment of sole arbitrator made to adjudicate disputes (Paras 1-5).
Issue of Consideration
Whether the arbitration clause in the agreement survives the termination of the contract and whether an arbitrator should be appointed under Section 11 of the Arbitration and Conciliation Act, 1996.
Final Decision
The court allowed the application and appointed a sole arbitrator to adjudicate the disputes between the parties.
Law Points
- Arbitration clause survives termination of contract
- Section 11 of Arbitration and Conciliation Act
- 1996
- Appointment of arbitrator when respondent fails to act
Case Details
2015 LawText (BOM) (08) 45
Arbitration Application No. 108 of 2012
Mr. Atul Singh a/w Mr. Amit Jajoo i/b. M/s. PKA Advocates for applicant No. 1; Mr. A. M. Sethna a/w Mr. P. S. Gujar for Respondent Nos. 1 and 2; Mr. D. A. Nalawade, Govt. Pleader a/w Mr. U. S. Upadhyay, AGP for respondent No. 3
M/s. Efkon (India) Pvt. Ltd. and ELogistics Pvt. Ltd.
Mr. M. B. Gajbhiye, Department of Post [India], and The State of Maharashtra
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Nature of Litigation
Application under Section 11 of the Arbitration and Conciliation Act, 1996 for appointment of a sole arbitrator.
Remedy Sought
Appointment of a sole arbitrator to adjudicate disputes arising from an agreement dated 12th November 2009.
Filing Reason
Disputes arose between the parties under the agreement; the petitioners invoked the arbitration clause but the respondents did not appoint an arbitrator.
Previous Decisions
Writ Petition No. 319 of 2012 was filed and withdrawn on 23rd February 2012 with liberty to invoke arbitration.
Issues
Whether the arbitration clause survives termination of the contract.
Whether an arbitrator should be appointed under Section 11 of the Arbitration and Conciliation Act, 1996.
Submissions/Arguments
Petitioners argued that the arbitration clause is independent and survives termination of the agreement.
Respondents opposed, contending that the agreement had been terminated and the arbitration clause did not survive.
Ratio Decidendi
The arbitration clause is independent of the main contract and survives termination of the agreement. Therefore, the court has jurisdiction to appoint an arbitrator under Section 11 of the Arbitration and Conciliation Act, 1996.
Judgment Excerpts
This Arbitration Application is filed under Section 11 of the Arbitration and Conciliation Act, 1996, and seeks the appointment of a sole Arbitrator.
The petitioners seek the appointment of an Arbitrator pursuant to clause 23 of the Agreement dated 12th November, 2009.
Procedural History
Notice invoking arbitration issued on 9th May 2012. Writ Petition No. 319 of 2012 filed and withdrawn on 23rd February 2012 with liberty to invoke arbitration. Present application filed thereafter. Heard in June 2015. Judgment reserved on 24th August 2015 and pronounced on 27th August 2015.
Acts & Sections
- Arbitration and Conciliation Act, 1996: Section 11
