Allowed

M/S. Gati Kintetsu Express Pvt. Ltd. v. M/S. N v S Associates

Karnataka HC17 Mar 2021CMP/10/2020

Case brief

AI extract

What is this about?

The High Court of Karnataka appointed a retired District Judge as sole arbitrator under Section 11(5) of the Arbitration Act, 1996, to adjudicate a lease dispute. The court held service sufficient despite returned postal cover and directed parties to undergo mediation before arbitration. Other merit contentions were reserved.

What did the court decide?

Appointed Sri. S.R.Somashekara, retired District Judge, as Sole Arbitrator for lease dispute after mandatory mediation.

M/S. Gati Kintetsu Express Pvt. Ltd. Vs M/S. N v S Associates — Arbitration | Karnataka HC (2021)

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 17^TH DAY OF MARCH 2021

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BEFORE

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THE HON'BLE MR.JUSTICE S. SUNIL DUTT YADAV

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CIVIL MISCELLANEOUS PETITION No.10/2020

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BETWEEN:

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M/S. GATI KINTETSU EXPRESS PVT LTD HAVING ITS REGISTERED OFFICE AT No.1-7-293, M.G.ROAD, SECUNDARABAD - 500 003 PRESENTLY AT PLOT NO.20, SURVEY NO.12, KOTHAGUDA KONDAPUR, HYDERABAD - 500 081 AND ITS BRANCH OFFICE AT PLOT NO.5C, 2^ND FLOOR, 1^ST PHASE PEENYA INDUSTRIAL AREA PEENYA, BANGALORE - 560 058 REP. BY ITS AUTHORISED SIGNATORY, AND GPA HOLDER, S B SRIKANTH AGED 42 YEARS S/O LATE S R BRAHMACHAR. ... PETITIONER

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(BY SRI ANANTHA NARAYANA B. N., ADVOCATE)

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AND:

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M/S. N V S ASSOCIATES REP BY ITS PARTNERS

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H S NARAYANASWAMY

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NO.283, 1^ST FLOOR NAGAPPA BUILDING HOODI CIRCLE

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MAHADEVAPURA POST BANGALORE - 560 048.

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C ASHOK NO.283, 1^ST FLOOR NAGAPPA BUILDING HOODI CIRCLE MAHADEVAPURA POST BANGALORE - 560 048. ... RESPONDENTS

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(BY SRI. K.N. DAYALU, ADVOCATE FOR R1 & R2)

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THIS CIVIL MISCELLANEOUS PETITION IS FILED UNDER SECTION 11(5) OF THE ARBITRATION AND CONCILIATION ACT, 1996, PRAYING TO APPOINT ANY RETIRED DISTRICT JUDGE TO ADJUDICATE UPON THE CLAIM MADE BY THE PETITIONER WITH RESPECT TO THE WAREHOUSE LEASE AGREEMENT DATED 30/06/2016 AS PER ANNEXURE-A TO THE PETITION BEFORE THE ARBITRATION CENTRE, BENGALURU.

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THIS CIVIL MISCELLANEOUS PETITION COMING ON FOR ADMISSION THIS DAY, THE COURT MADE THE FOLLOWING:

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ORDER

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The petitioner who is the Lessee has sought for appointment of an Arbitrator to adjudicate upon the claim arising out of the Lease Agreement dated 30.06.2016. The petitioner submits that he is the Lessee and the respondent is the Lessor who had entered into an agreement, copy of which is produced as per Annexure-'A'.

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It is submitted that Clause 34 provides for dispute

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resolution. As the dispute arose between the parties, the

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petitioner got issued the legal notice at Annexure-'D', which has been received by the first respondent, while the notice to the second respondent has returned with postal shara "Unclaimed". In light of absence of concurrence as regards appointment of an Arbitrator as sought for by the petitioner detailing the dispute at Annexure-'D', the present petition has been filed.

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Upon notice, the learned counsel for respondents have entered appearance and submit that the notice invoking arbitration clause has not been served on the respondent no.1 and the notice as regards respondent no.2 has been returned as "unclaimed", which would not amount to sufficient notice. Further contentions are raised as regards to the assertion of the petitioner and that no efforts were made amicably to resolve the dispute and accordingly, it is submitted that reference to arbitration would not arise.

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Heard both sides.

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Insofar as contention that notice is not served, it must be noted that the acknowledgement at Annexure-'E'

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would indicate that the first respondent has been duly served, as regards second respondent, no doubt the postal cover has been returned with postal shara "unclaimed", however, it is noticed that the address as mentioned in the postal cover at Annexure-'F' is the same address as found in the Lease Agreement at Annexure-'A' and in light of notice having been addressed to such address as found in the agreement, service of notice is held to be sufficient in terms of Section 3 of the Arbitration & Conciliation Act, 1996.

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As regards the other contentions raised by the

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respondents including that the agreement has come to an end in 2019, it must be noted that the clause for Arbitration would survive and mere lapse of the lease agreement would not have the effect of extinguishing the Clause providing for arbitration. All other contentions on merits raised by the respondents are kept open as the scope of present proceedings is limited to a prima-facie finding. Accordingly, taking note of Clause 34 of the Lease Agreement at Annexure-'A' as well as the legal notice dealing with the

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dispute, case is made out to allow the petition. However, in light of the specific stand that the parties have not explored amicable resolution of the dispute stipulated in Clause 34, the parties have to subject themselves to mediation and on failure of mediation, arbitration could be proceeded with.

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Accordingly, this petition under Section 11 of the Act, 1996 is disposed of by appointing Sri. S.R.Somashekara, retired District Judge to enter into the said reference of Arbitration and act as the Sole Arbitrator in the present case in the Arbitration and Conciliation Centre (Domestic & International), Bengaluru, as per the Rules governing the said Arbitration Centre. However, it is clarified that the proceedings are first to be subjected to mediation at the first instance and only on failure of the same, matter is to be taken up for arbitration by the Arbitrator. The efforts fro mediation to be explored through the same Arbitrator.

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(i) All claims and contentions are left/kept open

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to be decided by the Arbitral Tribunal.

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(ii) A copy of this order be sent forthwith to the Arbitration and Conciliation Centre (Domestic & International), Khanija Bhavan, Bengaluru, for proceeding further in the matter.

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(iii) Registry is directed to return all original documents produced by any of the parties after obtaining Photostat copies of the same.

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Sd/JUDGE

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Np/-

M/S. Gati Kintetsu Express Pvt. Ltd. v. M/S. N v S Associates

Case brief

What is this about?

What did the court decide?

M/S. Gati Kintetsu Express Pvt. Ltd. v. M/S. N v S Associates

Case brief

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What did the court decide?

What the court decided

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Issues for consideration

Statutes considered

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