Arbitration and Conciliation Act, 1996
Section 11—Scope of inquiry in a petition under Section 11 of the Arbitration and Conciliation Act is limited to examination of existence of an arbitration agreement—Whether or not it was permissible for the petitioner to terminate the contract by relying upon the Office Memorandum issued by the Government of India, is necessarily required to be adjudicated in the arbitral proceedings.
[Paras 8 & 9]
Section 11—Appointment of arbitrator—Disputes between the parties have arisen in context of a tender process initiated by respondent—Disputed fact as to whether petitioner (Joint Venture) is under insolvency—Even assuming the petitioner is under insolvency, the same will not prevent it (corporate debtor) from filing an application under Section 11 of the Act against another party, since the said proceedings are for the benefit of the corporate debtor—Former Judge appointed as a sole arbitrator to adjudicate the dispute between the parties—Petition allowed.
[Paras 11 & 12]
Section 11—Appointment of arbitrator—Disputes between the parties have arisen in context of a tender process initiated by respondent—Petitioner’s contention that it had already terminated the contract and thereafter cancellation of contract by the respondent is a farce and an attempt to build up a defence—Respondent cannot be permitted to frustrate the arbitration agreement by failing to make the alternative arrangements for inordinately long period—Almost two years have expired since the date of cancellation of contract and alternative arrangements are apparently not yet in place—Stipulation in the arbitration agreement that a serving officer of respondent shall act as arbitrator, is an invalid stipulation which makes it incumbent on High Court to appoint an independent sole arbitrator to adjudicate the disputes between parties—Former Judge appointed as a sole arbitrator to adjudicate the dispute between the parties—Petition allowed.
[Paras 8 to 17]