Allowed

Tata Capital Limited v. M/S Bharat Trading & Ors.

Delhi HC4 Sept 2024ARB.P./880/2024

Case brief

AI extract

What is this about?

Petition under Section 11(6) seeking appointment of an arbitrator over disputes arising from a channel finance facility granted under a Loan cum Guarantee Agreement containing an arbitration clause. Respondents were served but did not appear. The court appointed a sole arbitrator and directed arbitration under DIAC, leaving all contentions open.

What the court decided

AI extract

Tata Capital Limited Vs M/S Bharat Trading & Ors. — Arbitration | Delhi HC (2024)

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$~8

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IN THE HIGH COURT OF DELHI AT NEW DELHI

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- ARB.P. 880/2024

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TATA CAPITAL LIMITED .....Petitioner

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Through: Ms. Ekta Bhasin, Mr. Sanidhya Sonthalia, Advs.

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versus

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M/S BHARAT TRADING & ORS. .....Respondents Through:

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CORAM: HON'BLE MR. JUSTICE JASMEET SINGH

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O R D E R % 04.09.2024

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This is a petition filed under section 11(6) of the Arbitration and Conciliation Act, 1996 seeking appointment of an Arbitrator for adjudication of disputes between the parties.

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The facts are that respondent No. 1 is the proprietorship concern of Respondent No. 2 i.e. Ms. Jaswinder Kaur and had approached the petitioner for financial assistance.

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In this regard, the petitioner vide its sanction letter dated 04.06.2015 sanctioned a channel finance facility for an amount of Rs 10,00,00,000/however, the said sanction letter was subsequently reduced for an amount of Rs 8,00,00,000/- vide the sanction letter dated 28.06.2022.

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In terms of the sanction letter dated 28.06.2022, a Loan cum Guarantee (Channel Finance) Agreement was executed on 15.07.2022 for an amount of Rs 8,00,00,000/- whereby Respondent No. 3 was the guarantor for the said loan facility.

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This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 11/09/2024 at 12:31:27

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The arbitration clause is contained as Clause 12 in the Loan cum Guarantee (Channel Finance) Agreement dated 15.07.2022 which reads as under:

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“ 12 . Arbitration

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If any dispute, difference or claim arises between any of the Obligors and the Lender in connection with the Facility or as to the interpretation, validity, implementation or effect of the Facility Documents or as to the rights and liabilities of the parties under these T&Cs or alleged breach of the Facility Documents or anything done or omitted to be done pursuant to the Facility Documents, the same shall be settled by arbitration by a sole arbitration to be appointed as per the procedure below and to be held at such place as agreed by the Parties in Serial No. 17 of Annexure 1 hereto of the Agreement. The Party invoking the arbitration ("Claimant") shall address a notice to the other Party ("Respondent"} suggesting the names of not more than three arbitrators, all of whom shall be either retired judges of the District Court, High Court or the Supreme Court or a lawyer having minimum 10 years' relevant experience. The Respondent shall either:

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(i) Confirm in writing acceptance of one amongst the proposed names as the sole arbitrator to the Claimant within a period of ten (10) days from the date of notice ("Notice Period"); or

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(ii) Convey objection, if any, in writing to the Claimant, against the proposed names of the sole arbitrator within the said Notice Period. However, if the Claimant does not receive any response from the Respondent within the said Notice Period, the Claimant shall be entitled to nominate any one person from amongst the proposed three names as the sole arbitrator and such arbitrator shall be deemed to be appointed by both the Parties. In the event, the Respondent conveys its objection as per

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(ii) above then the sole arbitrator will be appointed by a Court having jurisdiction. The arbitration shall be conducted under the provisions of the Arbitration and Conciliation Act, 1996 together

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with its amendments, any statutory modifications or re-enactment thereof for the time being in force. The arbitration proceeding shall be conducted in English language. The award of the arbitrator shall be final and binding on all parties concerned. The cost of arbitration shall be borne by the Obligors .”

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Since there were disputes between the parties, the petitioner invoked arbitration vide legal notice against respondents on 29.04.2024. The present petition was thereafter filed.

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As per the service report, the respondents have been served, however there is nobody appearing on behalf of the respondent..

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For the said reasons, the petition is allowed and disposed of with the following directions:

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i) Ms. Rashmi Chopra, Adv. (Mob. No. 9810311218) is appointed as a Sole Arbitrator to adjudicate the disputes between the parties.

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ii) The arbitration will be held under the aegis of the Delhi International Arbitration Centre, Delhi High Court, Sher Shah Road, New Delhi hereinafter, referred to as the ‘DIAC’). The remuneration of the learned Arbitrator shall be in terms of the Fourth Schedule of the Arbitration & Conciliation Act, 1996.

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iii) The learned Arbitrator is requested to furnish a declaration in terms of Section 12 of the Act prior to entering into the reference.

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iv) It is made clear that all the rights and contentions of the parties, including as to the arbitrability of any of the claim, any other preliminary objection, as well as claims on merits of the dispute of either of the parties, are left open for adjudication by the learned arbitrator.

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v) The parties shall approach the learned Arbitrator within two weeks

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This is a digitally signed order.

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The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 11/09/2024 at 12:31:27

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JASMEET SINGH, J

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from today.

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SEPTEMBER 4, 2024/DM Click here to check corrigendum, if any

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Tata Capital Limited v. M/S Bharat Trading & Ors.

Case brief

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What the court decided

Tata Capital Limited v. M/S Bharat Trading & Ors.

Case brief

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What the court decided

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