Madras High Court
M/S.Gk Green Power Limited vs Also At on 20 June, 2022
Arb O.P.(Com. Div.) No.218 of 2022
IN THE HIGH COURT OF JUDICATURE AT MADRAS
Dated : 20.06.2022
CORAM
THE HONOURABLE Mr.JUSTICE M.SUNDAR
Arb O.P.(Com. Div.) No.218 of 2022
M/s.GK Green Power Limited
(Formerly M/s.TCS Textiles Pvt. Ltd.)
Rep. by its Authorised Representative
Mr.A.Muralikrishnan
No.6/21, College Road
1st Cross Street
Tiruppur – 641 602. ... Petitioner
Vs.
M/s.Suzlon Global Services Ltd.
Rep by its Designated Representative
Mr.Bhaskar
No.1055/18, Gowtham Centre (Near Anna Statue)
2nd Floor, Avinashi Road
Coimbatore.
Also at :
No.104, 1st Floor, Delta Wing
Raheja Towers
No.177, Anna Salai
Chennai – 600 002. ... Respondent
Arbitration Original Petition filed under Section 11(5) of the
Arbitration and Conciliation Act, 1996 praying to appoint an Arbitrator in
terms of the Agreement dated 10.03.2013, to render an award by adjudicating
upon the disputes that have arisen between the petitioner and the respondent.
1/10
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Arb O.P.(Com. Div.) No.218 of 2022
For Petitioner : Mr.D.Prasanna
ORDER
This order will now dispose of the captioned Arb.O.P.
2. This order has to be read in conjunction with and in continuation of
earlier proceedings made in the previous listing on 06.06.2022, which reads
as follows :
'Captioned 'Arbitration Original Petition' [hereinafter 'Arb OP'
for the sake of convenience and clarity] has been presented in this
Court on 23.03.2022 inter alia under Section 11 of 'The Arbitration
and Conciliation Act, 1996 (Act 26 of 1996)' [hereinafter 'A and C Act'
for the sake of brevity, convenience and clarity].
2. Mr.V.Jai Bharath, learned counsel representing
Mr.D.Prasanna, learned counsel on record for the petitioner submits
that the captioned Arb OP is predicated on an agreement captioned
'OPERATION AND MANAGEMENT AGREEMENT (SERVICES
ONLY)' dated 10.03.2013 and clause 14 thereat captioned 'DISPUTE
RESOLUTION' more particularly, clause 14.2 is the arbitration clause
between the parties being Arbitration Agreement within the meaning of
Section 2(1)(b) read with Section 7 of A and C Act.
3. Adverting to a notice dated 30.10.2021 issued by the
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Arb O.P.(Com. Div.) No.218 of 2022
petitioner through its counsel to respondent/noticee, learned counsel
submits that they had suggested three names and made a specific
request for nomination of arbitrator or give consent. Learned counsel
adverting to a reply dated 11.11.2021 from the respondent submits that
it is in the nature of interim reply as it says 'holding response' which is
terse and it is silent about the petitioner's request for consent/choosing
one of the three names suggested as arbitrator. Learned counsel
submits, on instructions, that nothing further has happened thereafter,
necessitating the presentation of the captioned Arb OP in this Court on
23.03.2022. This submission is recorded.
4. Prima facie case for issue of notice has been made out.
5. Issue notice to respondent returnable in a fortnight i.e.,
returnable by 20.06.2022. Private notice permitted.
6. List on 20.06.2022.'
3. Lone respondent in the captioned Arb.O.P. has been duly served
through Court and through private notice. This is evident from the case file
before this Court. To be noted, name of lone respondent together with
full/complete address is duly shown in the cause list. There is no
representation for lone respondent. There is nothing before this Court to
demonstrate that the lone respondent has entered appearance through any
counsel. Learned counsel for petitioner also confirms that no counsel has
taken noted endorsement from him.
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Arb O.P.(Com. Div.) No.218 of 2022
4. This Court deems it appropriate to dispose of the captioned Arb.OP
on merits as the lone respondent has not come before this Court to dispute
the existence of arbitration agreement between the parties. The reasons are
three-fold and they are as follows :
(i) Sub-section (13) of Section 11 of A and C Act reads as follows :
(13) An application made under this section for
appointment of an arbitrator or arbitrators shall be
disposed of by the Supreme Court or the High Court or the
person or institution designated by such Court, as the case
may be, as expeditiously as possible and an endeavour
shall be made to dispose of the matter within a period of
sixty days from the date of service of notice on the opposite
party.
To be noted, respondent has been duly served on 13.06.2022.
Therefore, this is an endeavour to dispose of the captioned Arb.OP within 60
days from the date of service on the respondent as per the mandate of Sub-
section (13) of Section 11 of A and C Act.
(ii) Hon'ble Supreme Court, in and by an order dated 19.05.2022 in
Special Leave Petition (C) No.5306 of 2022 [Shree Vishnu Constructions
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Arb O.P.(Com. Div.) No.218 of 2022
Vs. The Engineer in Chief, Military Engineering Service & Ors., ] has
emphasised the need for disposing of applications under Section 11 at the
earliest. Hon'ble Supreme Court has observed that keeping Section 11
petitions [which kick-start the ADR mechanism] pending would lead to the
object and purpose of A and C Act losing its significance. To be noted, most
relevant portions of Shree Vishnu Constructions order are as follows :
'..... Therefore, if the arbitrators are not appointed at the
earliest and the applications under Sections 11(5) and 11(6)
of the Arbitration Act are kept pending for a number of
years, it will defeat the object and purpose of the enactment
of the Arbitration Act and it may lose the significance of an
effective Alternative Dispute Resolution Mechanism. If the
Commercial disputes are not resolved at the earliest, not
only it would affect the commercial relations between the
parties but it would also affect economy of the country. It
may affect the ease of doing business in the country.'
'..... The litigant may lose the faith in the justice delivery
system, which may ultimately affect not only rule of law but
commerce and business in the country. Therefore, the
applications under Sections 11(5) and 11(6) of the
Arbitration Act and other applications, either for substitution
and/or change of the Arbitrator have to be decided and
disposed of at the earliest.'
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Arb O.P.(Com. Div.) No.218 of 2022
Hon'ble Supreme Court has also directed a copy of Shree Vishnu
Constructions order to be circulated to Registrars General of all High Courts
for being placed before respective Hon'ble The Chief Justices.
(iii) The scope of a legal drill under Section 11 is very limited and it
has to perambulate within the statutory perimeter sketched by sub-section
(6A) thereat, which reads as follows :
'(6A) The Supreme Court or, as the case may be, the High Court,
while considering any application under sub-section (4) or sub-
section (5) or sub-section (6), shall, notwithstanding any judgment,
decree or order of any Court, confine to the examination of the
existence of an arbitration agreement.'
5. Aforementioned sub-section (6A) of Section 11 of A and C Act
came up for consideration in the oft quoted Mayavati Trading Pvt. Ltd vs
Pradyuat Deb Burman case reported in (2019) 8 SCC 714. Relevant
paragraph Mayavati Trading case law is paragraph No.10 and the same
reads as follows:
'10. This being the position, it is clear that the law prior to the
2015 Amendment that has been laid down by this Court, which would
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Arb O.P.(Com. Div.) No.218 of 2022
have included going into whether acord and satisfaction has taken
place, has now been legislatively overruled. This being the position, it is
difficult to agree with the reasoning contained in the aforesaid
judgement, as Section 11(6-A) is confined to the examination of the
existence of an arbitration agreement and is to be understood in the
narrow sense as has been laid down in the judgement in Duro Felguera'
6. Aforementioned paragraph No.10 of Mayavati Trading case law
takes us to Duro Felguera principle being ratio laid down by Hon'ble
Supreme Court in M/s.Duro Felguera S.A. Vs M/s.Gangavaram Port
Limited reported in 2017 (9) SCC 729, relevant paragraphs in Duro
Felguera case are paragraph Nos.47 and 59 and the same read as follows:
'47. What is the effect of the change introduced by the
Arbitration and Conciliation (Amendment) Act, 2015 (hereinafter
referred to as "the 2015 Amendment") with particular reference to
Section 11(6) and the newly added Section 11(6-A) of the Arbitration
and Conciliation Act, 1996 (hereinafter referred to as "the 1996 Act")
is the crucial question arising for consideration in this case.
......
59. The scope of the power under Section 11(6) of the 1996 Act
was considerably wide in view of the decisions in SBP and Co. and
Boghara Polyfab. This position continued till the amendment brought
about in 2015. After the amendment, all that the Courts need to see is
whether an arbitration agreement exists – nothing more, nothing less.
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Arb O.P.(Com. Div.) No.218 of 2022
The legislative policy and purpose is essentially to minimize the Courts
intervention at the stage of appointing the arbitrator and this intention
as incorporated in Section 11(6-A) ought to be respected.”
7. In the case on hand, the respondent has not chosen to come before
this Court and dispute the existence of arbitration agreement between the
parties. To put it differently, existence of Clause 14.2 of Operation and
Management Agreement (Services Only) dated 10.03.2013, which has been
placed before this Court i.e., arbitration clause which serves as arbitration
agreement within the meaning of Section 2(1)(b) read with Section 7 of A
and C Act remains undisputed.
8. In the light of narrative thus far, this Court proceeds to appoint
Hon'ble Mr.Justice K.Venkataraman (Retd.), Former Judge of this Court,
residing at L-Block, No.125, East Anna Nagar, Chennai – 600 102,
Ph.No.77088-95435 as Sole Arbitrator. Hon'ble Arbitrator is requested to
enter upon reference, adjudicate qua arbitral disputes that have arisen
between the parties qua 'Operation and Management Agreement (Services
Only)' dated 10.03.2013, by holding sittings in 'Madras High Court
Arbitration Centre under the aegis of this Court' ['MHCAC'], in accordance
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Arb O.P.(Com. Div.) No.218 of 2022
with the Madras High Court Arbitration Proceedings Rules, 2017 and
Hon'ble Arbitrator's fee shall be as per Madras High Court Arbitration Centre
(MHCAC) (Administrative Cost and Arbitrator's Fees), Rules 2017.
Captioned Arb.OP disposed of in aforesaid manner. There shall be no
order as to costs.
20.06.2022
Index : Yes / No
Interner : Yes / No
Speaking order / Non-speaking order
ds
Note: Registry is directed to communicate a copy of this order forthwith to
1.Hon'ble Mr.Justice K.Venkataraman (Retd.),
Former Judge of this Court,
L-Block, No.125, East Anna Nagar,
Chennai – 600 102.
2. The Director,
Tamil Nadu Mediation and Conciliation Centre -cum-
Ex-Officio Member,
Madras High Court Arbitration Centre,
Madras High Court,
Chennai 600 104.
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Arb O.P.(Com. Div.) No.218 of 2022
M.SUNDAR. J.,
ds
Arb O.P.(Com. Div.) No.218 of 2022
20.06.2022
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