Case Law Details
Shameem Sultana Vs Faizunnissa Begum (Telangana High Court)
The application under Section 11(6) of the Arbitration and Conciliation Act, 1996 seeks the appointment of a sole arbitrator to resolve a dispute arising from a Partnership Deed dated 01.04.1994 between the applicant and respondents. The applicant sent notices requesting information and clarification related to the firm, followed by a notice informing the dissolution of the firm and calling for settlement of accounts. Upon disagreement, the applicant nominated a retired District Judge as the sole arbitrator and published a notice in newspapers regarding the firm’s dissolution. The dispute arises from the interpretation of Clause 19 of the Partnership Deed, containing an arbitration clause.
While the respondents did not dispute the existence of the Partnership Deed and the arbitration clause, they argued that the arbitrator’s jurisdiction is limited, and the relief sought by the applicant is beyond the scope of Clause 19. They further contended that disputes regarding insolvency and winding up are non-arbitrable. However, the court noted that objections to the arbitrator’s jurisdiction could be raised before the arbitral tribunal itself. Referring to legal precedents, the court emphasized the principle of competence-competence, stating that the arbitral tribunal has the authority to rule on its own jurisdiction.
Citing relevant legal provisions and Supreme Court decisions, the court appointed a former Supreme Court Judge as the sole arbitrator to adjudicate the dispute. It clarified that all contentions could be raised before the arbitrator and instructed the parties to appear before the arbitrator on a specified date. The arbitrator was directed to proceed with the arbitral proceedings in accordance with the law.
In conclusion, the Arbitration Application was allowed, and no costs were imposed. Any pending miscellaneous petitions were closed as a result of the decision.
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