Case Note & Summary
The petitioner, Minions Ventures Private Limited, filed a petition under Section 11(6) of the Arbitration and Conciliation Act, 1996, seeking appointment of a sole arbitrator to adjudicate disputes arising from a Share Subscription Agreement dated 10.04.2017 and a Shareholders Agreement dated 13.10.2017. The respondents, including Mr. Hardik Shah, Mr. Kunal Tekwani, M/s Ikshavaku Software Ventures India Pvt Ltd, and Mr. Pathik Paresh Shah, objected on the grounds that respondents 1, 2, and 4 were not parties to the arbitration agreements and that the claims were barred by limitation. The Court, after hearing arguments, held that the existence of an arbitration clause is sufficient for appointment under Section 11, and issues regarding non-signatory parties and limitation are matters for the arbitrator to decide. The Court appointed Mr. I.S. Antin, Retired District Judge, as the sole arbitrator to adjudicate the disputes.
Headnote
A) Arbitration Law - Appointment of Arbitrator - Section 11(6) of the Arbitration and Conciliation Act, 1996 - Existence of Arbitration Agreement - The petitioner sought appointment of a sole arbitrator to adjudicate disputes arising from a Share Subscription Agreement and a Shareholders Agreement, both containing arbitration clauses. The respondents objected that some of them were not signatories to the agreements and that the claims were time-barred. The Court held that the existence of an arbitration clause is sufficient for appointment under Section 11, and issues of non-signatory parties and limitation are matters for the arbitrator to decide. (Paras 1-10) B) Arbitration Law - Non-Signatory Parties - Section 11(6) of the Arbitration and Conciliation Act, 1996 - The Court observed that respondents 1, 2, and 4, though not signatories to the agreements, were claiming through or under the signatory respondent No.3, and thus could be bound by the arbitration agreement. The Court left this issue to be decided by the arbitrator. (Paras 8-10) C) Arbitration Law - Limitation - Section 11(6) of the Arbitration and Conciliation Act, 1996 - The Court held that the question of limitation is a mixed question of fact and law and should be decided by the arbitrator, not at the stage of appointment under Section 11. (Para 10)
Issue of Consideration
Whether an arbitrator should be appointed under Section 11(6) of the Arbitration and Conciliation Act, 1996, when the respondents object on grounds that some respondents are not parties to the arbitration agreement and that the claims are barred by limitation.
Final Decision
The petition is allowed. Mr. I.S. Antin, Retired District Judge, is appointed as the sole arbitrator to adjudicate the disputes between the parties. The arbitrator shall enter upon reference and complete the arbitration proceedings within a period of six months from the date of entering upon reference.
Law Points
- Arbitration agreement binding on non-signatories if they are claiming through or under signatory
- Section 11(6) of Arbitration and Conciliation Act
- 1996
- Appointment of arbitrator by Chief Justice or designate
- Existence of arbitration clause sufficient for appointment
- Limitation not to be decided at Section 11 stage
