IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 29th DAY OF MARCH 2019 BEFORE THE HON’BLE MR. JUSTICE ALOK ARADHE CIVIL MISCELLANEOUS PETITION NO.69 OF 2017 BETWEEN:
M/S PANCHAMISHREE CONSTRUCTIONS PVT LTD., A COMPANY INCORPORATED UNDER THE COMPANIES ACT HAVING ITS REGISTERED OFFICE AT #6, LAKSHMAIAH REDDY ROAD, ULSOOR, BENGALURU.
REPRESENTED BY ITS MANAGING DIRECTOR & AUTHORIZED REPRESENTATIVE MR.SETHURAM.
(BY MR.YESHU MISHRA, ADV.) AND:
M/S LAKSHMI GOLD KHAZAANA PVT. LTD., A COMPANY INCORPORATED UNDER THE COMPANIES ACT HAVING ITS REGISTERED OFFICE AT #475, SAMPIGE ROAD, VI CROSS, MALLESHWARAM, BENGALURU – 560 003.
REPRESENTED BY ITS MANAGING DIRECTOR, MR.K.P.NANJUNDI VISHWAKARMA.
… PETITIONER … RESPONDENT (BY MR.M.V.SRIDHAR CHAKRAVARTHI, ADV.) THIS CIVIL MISCELLANEOUS PETITION IS FILED UNDER SECTION 11(6) OF THE ARBITRATION AND CONCILIATION ACT 1996, PRAYING TO A) APPOINT ARBITRATION CENTRE - KARNATAKA, BENGALURU (INITIATIVE OF HIGH COURT OF KARNATAKA) AS SOLE ARBITRATOR TO DETERMINE AND ADJUDICATE UPON THE DISPUTES BETWEEN THE PARTIES VIDE ANNEXURE-B HEREIN IN ACCORDANCE WITH PROVISIONS OF ARBITRATION AND CONCILIATION ACT 1996.
THIS PETITION COMING ON FOR ADMISSION, THIS DAY, THE COURT MADE THE FOLLOWING:-
ORDER Sri.Yeshu Mishra, learned counsel for the petitioner.
Sri.M.V.Sridhar Chakravarthi, learned counsel for the respondent.
2. The Petition is admitted for hearing. With consent of the parties, the same is heard finally.
3. By means of this petition filed under Section 11(6) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as ‘the Act’ for short), the petitioner inter alia seeks to appoint the Arbitration Centre-Karnataka, Bengaluru, as sole arbitrator.
4. When the matter was taken up today, learned counsel for the petitioner submitted that Clause 19 of the Agreement dated 15.12.2014 contains an arbitration clause.
5. In pursuance of the aforesaid arbitration clause, the petitioner had sent a notice appointing “Arbitration Centre, Karnataka, Bengaluru” as sole arbitrator to get the dispute resolved in a fair and transparent manner. It is further submitted that the aforesaid appointment of arbitrator is in order as Arbitration Centre, Karnataka, Bengaluru, has power to appoint any person as an arbitrator.
6. On the other hand, learned counsel for respondent submits that the condition precedent for invocation of the arbitration clause has not been complied with by the petitioner.
7. I have considered the submission made by learned counsel for the parties.
8. The relevant extract of Clause 19 of the agreement executed between the parties reads as under:
“In case any dispute arising between the Owner and the contractor under this Agreement during the continuance of this contract or on its completion or on abandonment thereof, shall be referred to arbitration to a single arbitration appointed by both the parties. If both the parties do not agree upon the appointment of single arbitrator, each party shall nominate their own arbitrator who shall before entering on the reference appoint an umpire. The arbitrator or arbitrators as the case may be shall deliver the award within a period of six months from the date of entering on the reference. The award of the arbitrator or arbitrators shall be final and binding on the parties. The parties agree that arbitration under this clause shall be a condition precedent to any right of action under the contract.”
9. On perusal of the aforesaid clause, it is evident that if the dispute arises between the owner and the contractor under the agreement during the continuance of the contract or on its completion or on abandonment thereof, shall be referred to arbitration to a “single arbitrator” appointed by both the parties. In case, they do not agree upon the appointment of single arbitrator, each party shall nominate their own arbitrator who shall before entering on the reference, appoint an umpire.
10. In the instant case, the petitioner has not suggested the name of any arbitrator, but has suggested the name of “Arbitration Centre, Karnataka, Bengaluru.” The arbitration proceedings has to be conducted by some living person and the Arbitration Centre cannot act as an arbitrator on behalf of the petitioner. Therefore, it is evident that the requirement contained in Clause 19 of the Arbitration agreement has not been complied with. However, the Petition is disposed of with liberty to the petitioner to comply with the requirement contained in Clause 19 of Agreement and thereafter, to take action, in accordance with law, if advised.
With the aforesaid liberty, Petition is disposed of.
Sd/- JUDGE BNV