Anitha Gurukar vs Barista Coffee Company Ltd.
2009 Latest Caselaw 3825 Del

*            IN THE HIGH COURT OF DELHI AT NEW DELHI

                                                  Date of Reserve: September 10, 2009
                                                  Date of Order: September 17, 2009

+Arb. P. 145/2009
%                                                                       17.09.2009
     Anitha Gurukar                                                     ...Petitioner
     Through: Mr. Paras Khutton, Advocate

        Versus

        Barista Coffee Company Ltd.                       ...Respondent
        Through: Ms. Kiran Suri, Mr. Purvesh Bhuttan and Ms. Apana Bhatt,
        Advocates



        JUSTICE SHIV NARAYAN DHINGRA

1.      Whether reporters of local papers may be allowed to see the judgment?

2.      To be referred to the reporter or not?

3.      Whether judgment should be reported in Digest?


        JUDGMENT

1. This petition under Section 11 of Arbitration & Conciliation Act, 1996

("the Act", for short) has been preferred by the petitioner for appointment of

an arbitrator alleging breach of MoU dated 16th September 2008 on behalf of

respondent and the petitioner suffering loses because of breach of MOU. The

petitioner had given a notice dated 31st October, 2008 to the respondent for

appointment of an arbitrator in view of failure on the part of respondent for

implementing the terms and conditions of MOU. The respondent, however,

did not appoint arbitrator, hence this petition.

2. The stand taken by respondent is that there was no concluded contract

between respondent and the petitioner and the application for appointment of

arbitrator was not maintainable.

Arb. P. 145/2009 Anitha Gurukar v. Barista Coffee Company Ltd. Page 1 Of 3

3. It is not disputed by respondent that MOU dated 16th August 2008 was

signed between the parties. Vide this MOU, respondent had agreed to take on

rent the premises owned by the petitioner bearing number 30, Nehru Circle,

Sheshadripuram, Bangalore -560 020. The MOU provided for terms and

conditions on which the premises was to be taken. The MOU also provided

that a formal lease agreement shall be executed between the parties and the

lease shall be for a period of 12 years. It was specifically provided that the

lease so executed could not be terminated prematurely on the part of lessor.

This MOU contained an arbitration clause to the following clause:

"6. This MOU will be subject to the exclusive jurisdiction of the Courts in Delhi, India only.

7. In case any dispute cannot be settled amicably, the same shall be referred to the Arbitrator appointed in accordance with the Arbitration & Conciliation Act, 1996 or any subsequent enactment or amendment. The seat of Arbitration shall be at New Delhi and, the arbitration proceedings shall be held in English Language."

4. It is obvious that the MOU gave rise to a contract between the parties

and the plea taken by respondent that there was no concluded contract

between the parties, is a baseless plea. The respondent has relied upon

Uniflex Cables Ltd. v MTNL & Anr. AA No.155 of 2006 decided on 20th

February 2009 wherein this Court considered various terms of tender

document and observed that scheme of the tender document show that

Arbitration clause could not have come into existence before awarding of

contract and before furnishing of performance of security. The facts of the

Arb. P. 145/2009 Anitha Gurukar v. Barista Coffee Company Ltd. Page 2 Of 3 case referred to by the petitioner are altogether different from the facts of the

present case. In the instant case, the parties had signed the contract

containing an arbitration clause. Thus, the contract between the parties was

concluded and the parties were bound by the terms of the contract as

mentioned therein, including arbitration clause.

5. I, therefore, consider that there exists an arbitration agreement and

the MOU dated 16th September 2008 was a contract duly signed between the

parties and the disputes qua MOU dated 18th September 2008 could only be

referred to arbitration. I hereby allow this petition under Section 11 of the Act

and appoint Shri S.M. Chopra, Additional District Judge (retired) as the

arbitrator in this case. Parties are directed to approach the learned arbitrator

within 30 days from today.

September 17, 2009                                       SHIV NARAYAN DHINGRA J.
rd




Arb. P. 145/2009 Anitha Gurukar v. Barista Coffee Company Ltd.         Page 3 Of 3