Madras High Court
Mr.P.Jeyakumar vs Mr.A.Ragunathan on 31 March, 2022
Arb O.P.(Com. Div.) No.107 of 2022
IN THE HIGH COURT OF JUDICATURE AT MADRAS
Dated : 31.03.2022
CORAM
THE HONOURABLE Mr.JUSTICE M.SUNDAR
Arb O.P.(Com. Div.) No.107 of 2022
Mr.P.Jeyakumar
... Petitioner
Vs.
Mr.A.Ragunathan
... Respondent
Arbitration Original Petition filed under Section 11(6) of the
Arbitration and Conciliation Act, 1996, praying to appoint an arbitrator to
resolve the disputes between the petitioner and the respondent in terms of
Clause 6 of the MOU dated 19.01.2021 and clause 12 of another MOU dated
05.04.2021.
For Petitioner : Mr.M.A.Aruneshe
For Respondent : Mr.AR.M.Arunachalam
*****
ORDER
Mr.M.A.Aruneshe, learned counsel on behalf of the sole petitioner and
Mr.AR.M.Arunachalam, learned counsel on behalf of the lone respondent are
before this Court.
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Arb O.P.(Com. Div.) No.107 of 2022
2. This order has to be read in conjunction with and in continuation of
earlier proceedings made in the previous listings on 15.03.2022 and
29.03.2022, which read as follows:
'Proceedings dated 15.03.2022
Captioned 'Arbitration Original Petition' [hereinafter 'Arb
OP' for the sake of convenience and clarity] has been presented in
this Court on 21.02.2022 inter alia under Section 11(6) of 'The
Arbitration and Conciliation Act, 1996 (Act 26 of 1996)'
[hereinafter 'A and C Act' for the sake of brevity, convenience and
clarity], with a prayer for appointment of an Arbitrator.
2. Mr.M.A.Aruneshe, learned counsel on record submits that
the captioned Arb OP is predicated on a 'Memorandum of
Understanding [MOU] dated 19.01.2021' [hereinafter 'primary
agreement' for the sake of convenience and clarity] which is
preceded by a 'partnership deed dated 06.02.2008'
3. Learned counsel submits that clause 6 of primary
agreement (Page No.8 of the typed set of papers) is the arbitration
clause and the same reads as follows:
'6. That in case of any dispute between the parties, the
same shall be amicably settled and in case of failure thereon,
the same shall be referred to an Arbitrator to resolve the
problem. The provisions of Arbitration and Conciliation Act,
1996 shall apply. The venue of the Arbitration at Chennai.'
4. The above arbitration clause serves as an arbitration
agreement between the petitioner and respondent i.e., arbitration
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Arb O.P.(Com. Div.) No.107 of 2022
agreement within the meaning of Section 2(1)(b) read with Section 7
of A and C Act.
5. Suffice to say that it is the case of petitioner that a trigger
notice dated 31.12.2021 (page No.44 of the typed set of papers) was
issued invoking the aforementioned arbitration clause that met with
a reply dated 06.01.2022 (page No.48 of typed set of papers) and
the petitioner has sent a rejoinder dated 22.01.2022 (page No.53 of
the typed set of papers).
6. Adverting to the aforementioned reply from the respondent
(dated 06.01.2022), learned counsel submits that existence of the
arbitration agreement is not disputed but it has only been averred
that settlement is nearing completion.
7. In the light of the narrative thus far, issue notice to the
respondent returnable in a fortnight i.e., returnable by 29.03.2022.
Private notice permitted. Private notice through all electronic
modes of communications (subject to proof being demonstrated)
also permitted.
8. List on 29.03.2022.'
'Proceedings dated 29.03.2022
Mr.A.V.Arun, learned counsel for sole petitioner is before this
Court.
2. Read this in conjunction with and in continuation of earlier
proceedings made in the previous listing on 15.03.2022.
3. Pursuant to 15.03.2022 proceedings, lone respondent has
been duly served and name of lone respondent together with
full/complete address as in the cause title is shown in the cause list.
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Arb O.P.(Com. Div.) No.107 of 2022
4. Mr.Ar.M.Arunachalam, learned counsel with address for
service at No.175, Thambu Chetty Street, Parrys, Chennai, who is
before this Court submits that he has filed Vakalatnama on behalf of
lone respondent in the Registry on 28.03.2022 vide D.No.9572 of
2022.
5. Registry to verify and show the name of counsel for
respondent in the cause list if Vakalatnama is in order or otherwise,
name of the lone respondent and name of the counsel for respondent
together with Vakalatnama returned in parenthesis shall be shown in
the cause list.
6. List on 31.03.2022.'
3. Aforementioned proceedings are telltale qua crux and gravamen of
captioned Arb OP and the trajectory it has taken before this Court.
4. Respondent has filed a counter affidavit. A careful perusal of the
pleadings brings to light that the allegations and counter allegations are
essentially on merits of the matter but there is no disputation or disagreement
regarding the existence of arbitration agreement between the parties i.e.,
between the petitioner and respondent. To be noted, the same short forms
and abbreviations used in the previous proceedings [extracted and
reproduced supra] shall continue to be used in the instant order also.
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Arb O.P.(Com. Div.) No.107 of 2022
5. As would be evident from the earlier proceedings, captioned Arb OP
has been presented under Section 11(6) of A and C Act. A legal drill under
Section 11 of A and C Act is confined to 'examination of the existence of an
arbitration agreement'. This is ingrained in sub-section (6A) of Section 11 of
A and C Act and the judgment of Hon'ble Supreme Court in Mayavati
Trading Pvt. Ltd vs Pradyuat Deb Burman reported in (2019) 8 SCC 714,
relevant paragraph 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
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 reads as follows:
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Arb O.P.(Com. Div.) No.107 of 2022
'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.
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 light of the limited legal perimeter of a Section 11 legal drill,
this Court deems it appropriate to not to delve or dilate into the merits of the
matter. As there is no disputation regarding the existence of arbitration
agreement, this Court proceeds to appoint a sole Arbitrator leaving open all
questions including the rival contentions in the pleadings qua captioned Arb
OP to be decided by the Sole Arbitrator.
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Arb O.P.(Com. Div.) No.107 of 2022
8. Ms.D.Nagasaila, Advocate, with address for service at Old No.123,
New No.255, 3rd Floor, Hussaina Manzil, Angappan Naicken Street, Parrys,
Chennai 600 001. (Mobile No:94440 83494) (E-mail:
[email protected]) is appointed as sole Arbitrator.
9. Learned sole Arbitrator is requested to enter upon reference,
adjudicate the arbitral disputes that have arisen between the petitioner and
respondent qua Partnership Deed dated 06.02.2008, MOU dated 19.01.2021
[described as primary agreement in previous proceedings dated 15.03.2022]
and a further MOU dated 05.04.2021 and render an award by conducting
arbitration in accordance with 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 above terms. There shall be no
order as to costs.
31.03.2022
Speaking/Non-speaking order
Index : Yes / No
kmi
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Arb O.P.(Com. Div.) No.107 of 2022
M.SUNDAR. J.,
kmi
Note: Registry is directed to communicate a copy of this order forthwith to
1. Ms.D.Nagasaila,
Advocate,
Old No.123, New No.255,
3rd Floor, Hussaina Manzil,
Angappan Naicken Street,
Parrys, Chennai 600 001.
(Mobile No:94440 83494)
(E-mail: [email protected])
2. The Director,
Tamil Nadu Mediation and Conciliation Centre -cum-
Ex-Officio Member,
Madras High Court Arbitration Centre,
Madras High Court,
Chennai 600 104.
Arb O.P.(Com. Div.) No.107 of 2022
31.03.2022
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