Allowed

M/S Oswal Woolen Mills Ltd. v. M/S Rishabh Distributors and Anr.

Punjab & Haryana HC15 Sept 2011ARB/21/2011

Case brief

AI extract

What is this about?

Petitioner sought appointment of an arbitrator under an arbitration clause in a commercial agreement. The court appointed a sole arbitrator to resolve disputes and restrained invocation of a bank guarantee for 30 days.

What did the court decide?

Mr. M.K.Bansal appointed as sole arbitrator; petitioner restrained from invoking bank guarantee for 30 days.

M/S Oswal Woolen Mills Ltd. Vs M/S… — Contract and Commercial Disputes | Punjab & Haryana HC (2011)

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IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH

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Date of Decision : 15.09.2011

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Arb. Case No.21 of 2011

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M/s Oswal Woolen Mills Ltd.

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...Petitioner

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Versus

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M/s Rishabh Distributors and another

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...Respondents

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CORAM: HON'BLE MR. JUSTICE HEMANT GUPTA

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Present : Mr. Namit Gautam, Advocate, for the petitioner.

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M/s Sridhar Chakravarthi, Deepak Arora & A.S.Sidhu, Advocates, for the respondents.

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HEMANT GUPTA, J. (ORAL)

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The petitioner has invoked the jurisdiction of this Court for appointment of an Arbitrator in respect of the disputes between the parties arising out an Agreement dated 26.03.2008 (Annexure P-1).

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Vide the aforesaid Agreement, the petitioner has engaged the respondent as dealer at Banglore for opening of a exclusive showroom for retailing, selling and marketing the products manufactured by the petitioner. The arbitration clause between the parties reads as under:

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“ 11. SETTLEMENT OF DISPUTES

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11.1 Any disputes, difference arising out of or in the interpretation of any of the clauses of the agreement and or claims arising out of this Agreement shall be decided by Arbitration in accordance with the provisions of the Arbitration & Conciliation Act, 1996 or any statutory amendments thereof and shall be referred to three arbitrators, one each to be appointed by each of the party and the third to be appointed by the two so appointed arbitrators.

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Arb. Case No.21 of 2011

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11.2 All expenses of arbitration proceedings and sitting fee of the arbitrator will be shared equally by the parties to this agreement.

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11.3 The courts at Ludhiana shall have the exclusive jurisdiction to entertain the award submitted by the arbitrator for the purpose of making it a rule of the court.”

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The petitioner vide communication dated 23.03.2010 (Annexure P-6) has informed the respondent that Mr. S.K.Garg, Retd. Additional District & Sessions Judge has been appointed as an Arbitrator, but since the respondent did not consent to such an Arbitrator, the petitioner filed the present petition.

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In reply, the respondents have denied that there is any cause of action, which may require adjudication by an Arbitrator and that the petitioner intends to invoke the bank guarantee immediately after constitution of Arbitral Tribunal as per the order dated 16.12.2010.

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After hearing learned counsel for the parties, I am of the opinion that there are disputes between the parties. Such disputes are required to be adjudicated upon in terms of arbitration clause executed between the parties. However, learned counsel for the parties state that in stead of Arbitral Tribunal of three members, a sole Arbitrator be appointed for expeditious disposal of the disputes.

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Keeping in view the nature of disputes and the fact that the respondents have their registered offices at Banglore, the parties have consented to conduct arbitration proceedings at Delhi though subject to jurisdiction of the Courts at Ludhiana in terms of the arbitration clause, as mentioned above.

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Arb. Case No.21 of 2011

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Consequently, Mr. M.K.Bansal, District Judge (Retd.), resident of 175, Hope Apartment, Jharsa Road, Gurgaon, is appointed as an arbitrator to resolve all the disputes between the parties. The Arbitrator shall be entitled to charge fee of Rs.1,00,000/- apart from expenses of Rs.10,000/- to be shared equally by the parties initially. It is further ordered that the petitioner shall not invoke the bank guarantee for a period of 30 days i.e. on or before 17.10.2011 to enable the respondents to avail their remedy under Section 9 of the Arbitration & Conciliation Act, 1996 for protection of their rights in accordance with law.

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Disposed of.

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15.09.2011 (HEMANT GUPTA) Vimal JUDGE

M/S Oswal Woolen Mills Ltd. v. M/S Rishabh Distributors and Anr.

Case brief

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M/S Oswal Woolen Mills Ltd. v. M/S Rishabh Distributors and Anr.

Case brief

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