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TMI Blog2022 (9) TMI 1117X X X X Extracts X X X X X X X X Extracts X X X X ..... to be a document executed on behalf of both the parties, showing consensus ad-idem, incorporating such an arbitration clause/agreement. The only document signed on behalf of both the parties is the letter of intent dated 12/07/2012, which admittedly contains no arbitration clause/agreement. Similarly, even the purchase order dated 16/07/2012, which is signed only on behalf of the petitioners does not contain such an arbitration clause. This Court is of the opinion that merely because the proposal forwarded on behalf of the respondents, by letter dated 26/06/2012, contained an arbitration clause, which was unilaterally signed only on behalf of the respondents and there was reference thereto in the letter of intent dated 12/07/2012 and the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Regular Civil Appeal No.93 of 2019, before the Court of Principal District Judge, Nagpur. By judgment and order dated 12/02/2021, the said Court dismissed the appeal as untenable. The said judgment and order is also made subject matter of challenge in the present writ petition. (4) The petitioners filed Special Civil Suit No. 324 of 2017 against the respondents for recovery of a specific amount, claiming that the respondents while executing a contract and constructing a warehouse, had used sub-standard material and that in such circumstances, the petitioners were entitled to specific amount claimed in the said suit. (5) The respondents filed application under Section 8(1) of the Act of 1996, claiming that there was an arbitration clau ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not contain any arbitration clause. Reference was also made to a purchase order dated 16/07/2012, virtually reiterating the clauses and terms and conditions stated in the letter of intent, in pursuance of which, the respondents proceeded to execute the project. On this basis, it was submitted that the trial Court failed to appreciate the true nature of the documents executed between the parties and that in the absence of an arbitration clause / agreement, power under Section 8(1) of the Act of 1996, was erroneously exercised by the trial Court and therefore, the suit was also wrongly disposed of. A feeble attempt was made to claim that the judgment and order passed by the District Court dismissing the appeal as untenable, deserved to be se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stence of such an arbitration clause/agreement. (9) It is the case of the respondents that the purchase order dated 16/07/2012, read with the proposal dated 26/06/2012, demonstrates that there was indeed an arbitration clause and that therefore, the trial Court was justified in exercising power under Section 8 of the Act of 1996, for referring the parties to arbitration and in that light disposing of the suit itself. (10) Th is Court has perused the letter dated 26/06/2012, which forwarded a proposal dated 10/05/2012, from the respondents to the petitioners. In this document, which is signed unilaterally by the respondents, there is indeed an arbitration agreement at clause (14). It appears that in response thereto the petitioners iss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tentions raised on behalf of the respondents and proceeded on the basis that there was an arbitration agreement between the parties as stated in clause No. (14) of the proposal dated 10/05/2012, forwarded by letter dated 26/06/2012 on behalf of the respondents. Having concluded that there was an arbitration clause/agreement signed by the parties, the trial Court proceeded to exercise power under Section 8 of the Act of 1996 and allowed the application, thereby relegating the parties to arbitration and in that light disposed of the suit itself. (13) This Court is of the opinion that the trial Court committed a grave error in failing to appreciate the true purport of the documents on record. For an arbitration agreement to come into existe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tter while exercising power under Section 8 of the Act of 1996. (14) In this context, reliance placed by the learned counsel appearing for the respondents on judgment of the Hon ble Supreme Court in the case of Sundaram Finance Limited and another vs. T. Thankam, (2015) 14 SCC 444, particularly paragraph 8 thereof, cannot be of any assistance to the respondents, for the reason that in the said case, the Hon ble Supreme Court found on facts that there was indeed an arbitration agreement existing between the parties. (15) In view of the above, it becomes clear that the orders dated 01/12/2018, passed on Exhs.1 and 24 by the trial Court are unsustainable. (16) Insofar as the judgment and order dated 12/02/2021, passed by the Distr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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