Delhi HC Allows Invocation Of Arbitration Clause After 10 Yrs, Says That Scope Of S.11(6) Plea Is Limited To Ascertaining Existence Of Agreement

Brief Facts:

The petition was filed under Section 11(6) of the Arbitration and Conciliation Act, 1996 for appointment of a sole arbitrator for resolving the disputes between the parties. The parties entered into an agreement after the petitioner accepted the bid of the respondent with respect to the construction of park, ride and holding facilities at Safdarjung Airport. Thereafter, certain disputes arose between the parties regarding outstanding monetary entitlement. But the petitioner invoked the arbitration clause after a hiatus of more than 10 years to constitute an arbitral tribunal for adjudicating the disputes between the parties. The respondent contended that the claim raised by the petitioner are time barred.

Observation of the court:

The court held that the scope of the present proceedings is confined to ascertaining the existence of the arbitration agreement. Also, the objections raised by the respondent would be required to be considered by a duly constituted arbitral tribunal.

Further, the court relied on the judgment of the Supreme Court in SBI General Insurance Co. Ltd. v. Krish Spinning (2024) and Interplay between Arbitration Agreements under the Arbitration & Conciliation Act, 1996 & the Indian Stamp Act, 1899, In re, (2023).

Then, the court held that since the existence of the arbitration agreement is apparent from a perusal of the Agreement between the parties, there is no impediment to appointing an independent sole arbitrator for adjudicating the disputes between the parties. The court appointed Justice (Retd.) A. K. Pathak as the sole arbitrator and also held that the respondent shall be entitled to raise appropriate objections regarding the limitation/jurisdiction, before the sole arbitrator.

Case Title: SHRI KR ANAND v. NEW DELHI MUNICIPAL COUNCIL

Case Number: ARB.P. 1776/2024

Counsel for the Petitioner: Mr. Mukesh Kumar, Adv. (through v/c)

Counsel for the Respondent: Mr. Sanjay Sharma, Adv. (through v/c)

Date of Judgment: 13.11.2024

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