2015 (9) TMI 812 - SC - Indian Laws

Application seeking appointment of an arbitrator - The area of dispute is small and narrow, namely, the entitlement of the petitioner to 5% of his claimed dues which, according to the petitioner, has been wrongly withheld by the respondent. - Held that - the Court does not find any ambiguity or inconsistency in the description of parties so as to non-suit the applicant-petitioner by dismissing its application on the above basis. The ambiguity, if any, in the description of the parties having been explained and the respondent Company itself having issued L.O.Is. and having exchanged subsequent correspondences with the applicant with regard to the works under the sub-contracts, though executed in the name of the Taiyo Membrane Corporation and Taiyo Membrane Corporation (India), the applicant s petition cannot be held to be not maintainable as urged on behalf of the respondent. Having held as aforesaid and the remaining objections, as noticed, being within the province of the Arbitrator the Court is inclined to grant the prayers made. Accordingly, Dr. Justice M.K. Sharma, a former Judge of this Court is appointed as the sole Arbitrator.

Issues:
1. Application under Section 11(6) of the Arbitration and Conciliation Act, 1996 for appointment of an arbitrator.
2. Dispute regarding the entitlement of the petitioner to 5% of claimed dues.
3. Objection to appointment of arbitrator based on contractual obligations and parties involved in sub-agreements.
4. Clarification of parties involved in sub-agreements and correspondence exchanged.
5. Alleged mis-description of parties in agreements and relevance of Australian Corporation Act.
6. Resolution of ambiguity in party description and maintainability of the application.
7. Appointment of Dr. Justice M.K. Sharma as the sole arbitrator.
8. Referral of all disputes to the arbitrator with discretion on fees and conditions.
9. Communication of order to the arbitrator for expeditious arbitration proceedings.
10. Disposal of the Arbitration Petition.

Analysis:

1. The judgment pertains to an application filed under Section 11(6) of the Arbitration and Conciliation Act, 1996, seeking the appointment of an arbitrator to resolve disputes arising from sub-contracts related to the renovation of a stadium. The applicant, Taiyo Membrane Corporation Pty. Ltd., sought arbitration with the respondent over the release of 5% of claimed dues.

2. The main area of dispute was the entitlement of the petitioner to the withheld 5% of dues, contested by the respondent. The respondent objected to the appointment of an arbitrator, citing unfulfilled contractual obligations on the part of the petitioner as a primary ground for refusal.

3. The respondent further argued against the validity of the arbitration clause invocation, highlighting discrepancies in the parties involved in the sub-agreements. The objection raised jurisdictional concerns, asserting that the applicant was not a party to the relevant agreements, thus challenging the basis for arbitration under Section 11(6) of the Act.

4. In response to the objections, the petitioner provided evidence through affidavits and correspondences to establish that Taiyo Membrane Corporation Pty. Ltd. and Taiyo Membrane Corporation were the same entity, clarifying the confusion regarding party descriptions in the sub-agreements.

5. Despite some confusion in party descriptions, the court found that the correspondence and actions of the parties indicated the unity of the entities involved. Reference to the Australian Corporation Act was made to support the argument that the mis-description did not invalidate the application.

6. The court resolved the ambiguity in party descriptions, emphasizing the maintainability of the application based on the clarification provided by the petitioner. With the respondent's objections deemed arbitrable, the court proceeded to appoint Dr. Justice M.K. Sharma as the sole arbitrator to address all disputes.

7. Dr. Justice M.K. Sharma was appointed as the sole arbitrator, with all disputes, including those raised in the petition, referred to him. The arbitrator was granted the authority to determine fees and conditions in consultation with the parties to facilitate expeditious arbitration proceedings.

8. The court ordered the communication of the appointment to the arbitrator to initiate and conclude the arbitration proceedings promptly, thereby disposing of the Arbitration Petition in the specified terms.

← Previous Next →