Prism Johnson Ltd Vs Doosan Power Systems India Pvt Ltd (Delhi High Court)
Delhi High Court held that there was no requirement to resort to Clause 25(c) of GTC to formally notify the ICA for appointment of the Arbitrator and notice sent by invoking arbitration agreement u/s. 21 of the Arbitration and Conciliation Act, 1996 is valid invocation.
Facts- This petition is filed on behalf of the Petitioner under Section 11(4)(a) and (6) of the Arbitration and Conciliation Act, 1996 (‘1996 Act’) for appointment of nominee Arbitrator of the Respondent Company to adjudicate the inter se disputes between the parties.
It is further averred that the contract between the parties contains Arbitration Clause 25 in the General Terms of Conditions (‘GTC’) and since disputes had arisen, Petitioner sent a notice dated 13.09.2024 to the Respondent under Section 21 of 1996 Act invoking the arbitration agreement. By a subsequent letter dated 08.10.2024, Petitioner nominated its Arbitrator and intimated the same to the Respondent, however, vide letter dated 11.10.2024, Respondent refused to nominate its nominee Arbitrator stating that the invocation notice by the Petitioner was contrary to Clause 25(b) of GTC as amended by Special Terms and Conditions (‘STC’), providing that disputes shall be settled by arbitration in accordance with Rules of Domestic Commercial Arbitration of the Indian Council of Arbitration (‘ICA Rules’) and was therefore non-est with no legal consequence. Since period of 30 days passed without the Respondent nominating its Arbitrator or in the alternative amicably resolving the disputes by conciliation, Petitioner approached this Court for appointment of nominee Arbitrator of the Respondent in terms of the Arbitration Clause which envisages constitution of three-member Arbitral Tribunal.
