Allowed

Sobha Assets Private Limited v. Special Agricultural Produce Market Committe for Fruits, Flowers and Vegetables

Karnataka HC21 Mar 2023CMP/1/2023

Case brief

AI extract

What is this about?

The High Court of Karnataka, under Section 11(6) of the 1996 Act, interpreted the arbitration clause to mandate a sole arbitrator rather than a panel. The respondent requested three arbitrators; the court rejected this based on Section 10 of the 1996 Act and appointed a former judge as the sole arbitrator.

What did the court decide?

Petition allowed; Mr. Justice Raghavendra S. Chauhan appointed as Sole Arbitrator; proceedings to be conducted at the Arbitration and Conciliation Centre, Bengaluru.

Sobha Assets Private Limited Vs Special Agricultural Produce… — Arbitration | Karnataka HC (2023)

¶1

¶2

CMP No. 1 of 2023

¶3

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 21^ST DAY OF MARCH, 2023

¶4

BEFORE

¶5

THE HON'BLE MR JUSTICE S.G.PANDIT CIVIL MISC. PETITION NO. 1 OF 2023

¶6

BETWEEN:

¶7

SOBHA ASSETS PRIVATE LIMITED, A COMPANY INCORPORATED UNDER THE PROVISIONS OF THE COMPANIES ACT, 1956, HAVING ITS REGISTERED OFFICE AT 'SOBHA', DEVARABISANAHALLI, SARJAPURA-MARATHAHALLI OUTER RING ROAD, BELLANDUR POST, BANGALORE - 560 103. REP. BY ITS AUTHORIZED SIGNATORY MR. PRASAD. M. S. - ASSISTANT GENERAL MANAGER - LEGAL.

¶8

Digitally signed by MARIGANGAIAH PREMAKUMARI Location: HIGH COURT OF KARNATAKA

¶9

SOBHA LIMITED,

¶10

(FORMERLY KNOWN AS SOBHA DEVELOPERS LIMITED), A COMPANY INCORPORATED UNDER THE PROVISIONS OF THE COMPANIES ACT, 1956, HAVING ITS REGISTERED OFFICE AT 'SOBHA', DEVARABISANAHALLI, SARJAPURA - MARATHAHALLI OUTER RING ROAD, BELLANDUR POST, BANGALORE - 560 103. REP. BY ITS AUTHORIZED SIGNATORY MR. PRASAD. M. S. -

¶11

¶12

CMP No. 1 of 2023

¶13

ASSISTANT GENERAL MANAGER - LEGAL.

¶14

…PETITIONERS

¶15

(BY SRI. P S RAJAGOPAL, SENIOR COUNSEL ALONG WITH SRI. KEMPEGOWDA, ADVOCATE)

¶16

AND:

¶17

SPECIAL AGRICULTURAL PRODUCE MARKET COMMITTE FOR FRUITS, FLOWERS AND VEGETABLES, AGRAHARA TANK BUND ROAD, BINNYPET, BANGALORE - 560 023. REPRESENTED BY ITS SECRETARY.

¶18

…RESPONDENT

¶19

(BY SRI. NANDA KISHORE, ADVOCATE)

¶20

THIS CIVIL MISC. PETITION UNDER SECTION 11(6) OF THE ARBITRATION AND CONCILIATION ACT 1996, PRAYING TO A) APPOINT A SOLE ARBITRATOR FOR ADJUDICATION OF THE DISPUTES THAT HAVE ARISEN BETWEEN THE PETITIONERS AND RESPONDENT AS PROVIDED IN ARTICLE/CLAUSE 12.2 OF THE PROJECT DEVELOPMENT AND IMPLEMENTATION AGREEMENT ('PDIA') DATED 17.04.2012 ENTERED INTO BY AND BETWEEN THE PETITIONERS AND RESPONDENT VIDE ANNEXURE 'F'.

¶21

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

¶22

3 - CMP No. 1 of 2023

¶23

ORDER

¶24

Heard Sri. P.S.Rajagopal, learned Senior Counsel along with Sri. Kempegowda, learned counsel for the petitioners and Sri. Nanda Kishore, learned counsel for the respondent. Perused the petition papers.

¶25

The petitioners are before this Court under Section 11(6) of the Arbitration and Conciliation Act, 1996 (for short 'the 1996 Act') praying for an appointment of Sole Arbitrator for adjudication of the disputes between the parties in terms of Clause-12.2 of the Project Development and Implementation Agreement ('PDIA') dated 17.04.2012 at Annexure-F.

¶26

Both the learned counsel invites attention of this Court to arbitration Clause-12.2 of the Agreement dated 17.04.2012, which reads as follows:

¶27

"12.2 Arbitration

¶28

(a) Procedure

¶29

Subject to the provisions of Article 12.1, any Dispute which is not resolved amicably shall be finally settled by binding arbitration under the Arbitration and Conciliation Act, 1996.

¶30

(b) Place of Arbitration

¶31

¶32

CMP No. 1 of 2023

¶33

The place of arbitration shall ordinarily be Bangalore but by agreement of the Parties, the arbitration hearings, if required, may be held elsewhere.

¶34

(c) English Language

¶35

The request for arbitration, the answer to the request, the terms of reference, any written submissions, any orders and awards shall be in English and, if oral hearings take place, English shall be the language to be used in the hearings.

¶36

(d) Enforcement of Award

¶37

The Parties agree that the decision or award resulting from arbitration shall be final and binding upon the Parties and shall be enforceable in accordance with the Provision of the Arbitration Act subject to the rights of the aggrieved parties to secure relief from any higher forum."

¶38

Sri. P.S.Rajagopal, learned Senior Counsel would

¶39

submit that the dispute between the parties shall be resolved

¶40

by the Sole Arbitrator. Learned counsel Sri. Nanda Kishore submitted that the dispute be resolved by Panel of Arbitrators taking note of stake involved and importance of the matter.

¶41

The above extracted Clause 12.2 of the

¶42

agreement dated 17.04.2012 provides for resolution of dispute by process of Arbitration under 1996 Act. The

¶43

¶44

CMP No. 1 of 2023

¶45

Arbitration clause would not suggest or determines the number of Arbitrators. Section 10 of 1996 Act reads as follows:

¶46

“ 10. Number of arbitrators.— (1) The parties are free to determine the number of arbitrators, provided that such number shall not be an even number.

¶47

(2) Failing the determination referred to in sub-section (1), the arbitral tribunal shall consist of a sole arbitrator.”

¶48

A reading of the above provision makes it abundantly clear that the parties are free to determine the number of Arbitrators and if the number of Arbitrators is not determined or is not provided under the agreement, the Arbitral Tribunal shall consist of a Sole Arbitrator. As contended by learned counsel for the respondent, appointment of Arbitrator would not depend upon the stake involved and importance of the matter, but it would depend on the arbitration clause contained in the agreement. Hence, contention of the learned counsel for respondent to appoint panel of Arbitrators to resolve the dispute is liable to be rejected and accordingly rejected.

¶49

¶50

CMP No. 1 of 2023

¶51

The petitioners raised a dispute and nominated

¶52

Former Judge of this Court to resolve the dispute by issuing notice dated 06.12.2022. The respondent replied by notice dated 20.12.2022, consenting for appointment of Arbitrator, but however, sought for Arbitral Tribunal consisting of three judges to resolve the dispute.

¶53

On hearing the learned counsel appearing for parties and on perusal of petition papers, I am of the view that necessary conditions for exercise of jurisdiction under Section 11(5) of 1996 Act are satisfied. In terms of the agreement dated 17.04.2012, a retired Judge of this Court must be appointed as the Sole Arbitrator. Hence, the following:

¶54

ORDER

¶55

(i) The petition is allowed.

¶56

(ii) Shri Justice Raghavendra S. Chauhan, Former Chief Justice of High Court of Uttarkhand and High Court of Telangana, residing at D-31, 2^nd Floor, Nizamuddin East, Gate No.6, New Delhi110013, is appointed as Sole Arbitrator to

¶57

¶58

CMP No. 1 of 2023

¶59

enter reference of the dispute between the petitioners and respondent and conduct proceedings at Arbitration and Conciliation Centre (Domestic and International) Bengaluru, according to the Rules governing Arbitration and Conciliation Centre (Domestic and International) Bengaluru.

¶60

(iii) Registry is directed to communicate this order (by E-mail) to the Arbitration and Conciliation Centre (Domestic and International) Bengaluru and also to Shri Justice Raghavendra S. Chauhan, Former Chief Justice of High Court of Uttarkhand and High Court of Telangana, as required under the Appointment of Arbitrators by the Chief Justice of Karnataka High Court Scheme, 1996.

¶61

Sd/JUDGE

¶62

SMJ

¶63

List No.: 1 Sl No.: 52 CT:STK

Sobha Assets Private Limited v. Special Agricultural Produce Market Committe for Fruits, Flowers and Vegetables

Case brief

What is this about?

What did the court decide?

Sobha Assets Private Limited v. Special Agricultural Produce Market Committe for Fruits, Flowers and Vegetables

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

Similar cases

Sri Thammegowda Vs the Deputy Commissioner

Joanna Seraphine D Souza Vs the State of Karnataka

Sri T. Vijaya Vs State of Karnataka

Smt. Padamakshi Vs State of Karnataka

Smt Jayamma Vs State of Karnataka

B Mallikarjun Vs the Special Deputy Commissioenr