THE HON’BLE Ms. JUSTICE G.ROHINI Arbitration Application Nos. 76 and 77 of 2010 Date19.04.2011 A.A.No.76 of 2010 Between: M/s. Wockhardt Hospitals Limited, Hyderabad. …Applicant And M/s. Kamineni Hospitals Limited, Hyderabad. …Respondent A.A.No.77 of 2010 Between: M/s. Wockhardt Hospitals Limited, Hyderabad. …Applicant And M/s. Kamineni Health Services Private Limited, Hyderabad. …Respondent THE HON’BLE Ms. JUSTICE G.ROHINI Arbitration Application Nos. 76 and 77 of 2010 COMMON ORDER: M/s. Wockhardt Hospitals Limited is the applicant in both these applications filed under Section 11(6) of the Arbitration and Conciliation Act, 1996 (for short, ‘the Act’) for appointment of an Arbitrator for deciding the disputes between the applicant and the respondents arising out of the agreements dated 23.04.2005 and 19.05.2005. The applicant company claims to have been engaged in the business of owning, acquiring, promoting, establishing, conducting, taking on lease, hiring, running, managing and supporting hospitals and medical centers. The respondent company in A.A.No.77 of 2010 has been running a hospital in the building bearing No.4-1-1227 Boggulakunta, King Koti, Hyderabad under the name and style of M/s. Kamineni Health Services Private Limited. The respondent company in A.A.No.76 of 2010 is M/s. Kamineni Hospitals Limited, which is a group company of the respondent in A.A.No.77 of 2010 and it is running a hospital at L.B.Nagar. The applicant and the respondent in A.A.No.77 of 2010 entered into a “Management Agreement’ dated 23.04.2005 under which the applicant company agreed to manage the hospital as per the terms and conditions mentioned therein. The total period agreed upon under the said agreement is 30 years from 23.04.2005. Similar ‘Management Agreement’ dated 19.05.2005 was entered into between the applicant and the respondent in A.A.No.76 of 2010 in respect of the hospital at L.B.Nagar. It is alleged by the applicant that with an dishonest intention to cause irreparable and illegal loss to the applicant and to gain wrongful gains, the respondents had started raising various untenable issues and due to their acts, various disputes had arisen between the parties. It is also alleged that the respondents having committed breach of the agreements, took over the management and also possession of the hospitals. On account of the violation of various terms and conditions of the contract by the respondents serious differences and disputes arose including the dispute of rights, liabilities and interpretation of various clauses in the agreement. In the circumstances, the applicant got issued a legal notice dated 07.01.2010 invoking the arbitration clause. The respondents gave a reply dated 26.01.2010 raising various claims and contending that the question of reference to arbitration did not arise as there were no disputes at all among the parties. Hence, these two applications under Section 11(6) (b) of the Act with a prayer to appoint a sole Arbitrator. Separate counter affidavits have been filed by the respondents denying all the allegations, including that the respondents had committed breach of the agreements. It is alleged that as the applicant without any prior intimation abruptly left the management of the hospitals, the respondents in the interest of in-patients and to save the reputation of the hospital were left with no other option except to manage and operate the facilities with effect from 16.12.2009. It is also alleged that having voluntarily withdrawn their services in the hospitals for the reasons best known to them the applicant had been filing cases after cases with all false allegations. I have heard Sri S.Ravi, the learned senior counsel appearing for the applicant and Sri E.Ajay Reddy the learned counsel appearing for the respondents. It is clear from the material available on record that there are serious disputes and differences between the parties with regard to the management of the hospitals under the agreements dated 23.04.2005 and 19.05.2005. It is also brought to my notice by the learned counsel that the applicant herein filed O.P.Nos. 169 and 155 of 2010 and O.P.No.2417 of 2009 on the file of the Court of the II Additional Chief Judge, City Civil Court, Hyderabad under Section 9 of the Arbitration and Conciliation Act, 1959 seeking various reliefs. By orders dated 13.04.2010 the said O.Ps were dismissed and aggrieved by the same, the applicant herein preferred C.M.A.Nos. 490, 491 and 492 of 2010. The said appeals were also dismissed by a Division Bench of this Court by order dated 12.11.2010. Be that as it may, admittedly, the Management Agreements dated 23.04.2005 and 19.05.2005 contained a specific provision for dispute resolution by way of arbitration. The said clause reads as under: “23. Dispute Resolution: 23.1 Amicable Settlement: If any dispute or difference or claim of any nature whatsoever arises between the parties in connection with construction, interpretation or application of any terms and conditions or any matter or thing in any way connected with or in connection with or arising out of this agreement, or the rights, duties or liabilities of any party under this agreement, whether before or after the termination of this agreement, then the Mr.Habil Khoraklwala representing Wockhardt and Mr. Shashidhar Kamineni representing the Owner shall meet together, promptly at the request of any party, in an effort to resolve such dispute, difference or claim by discussions between them. 23.02. Arbitration: a) Arbitrators Failing amicable settlement between the parties, the dispute or differences or claims as the case may be, shall be finally settled by binding arbitration under the Arbitration and Conciliation Act, 1996. the arbitration shall be by a sole arbitrator to be appointed by mutual agreement of the parties, and failing which, in accordance with Arbitration an Conciliation Act, 1996.” As could be seen from the notices exchanged between the applicant and the respondents, both parties are making various claims and counter-claims against each other. Though the respondents in their counter-affidavits contended that as the applicant had voluntarily withdrawn from the agreements, there were no disputes among the parties, during the course of arguments the learned counsel for the respondents conceded that there are various disputes and differences among the parties and the same require resolution by arbitration. It is also represented by the learned Senior Counsel for the applicant that there is no possibility of amicable settlement as provided under clause 23.1. Therefore, the disputes and differences between the parties shall be settled by arbitration in terms of clause 23.2 of the agreements. The learned counsel for the respondents did not dispute the same and while agreeing for appointment of arbitrator, the learned counsel for the respondents sought liberty to file the claims of the respondents before the arbitrator. Since both the learned counsel agreed for appointment of a sole arbitrator, Sri Justice Motilal B. Naik, a retired Senior Judge of this Court is hereby appointed as the Arbitrator for resolution of the disputes/differences and claims arising out of the agreements dated 23.04.2005 and 19.05.2005 between the parties. Both the applicant and the respondents are at liberty to file their respective claims before the learned Arbitrator. The learned Arbitrator is at liberty to fix his fees and the same shall be borne by both parties. The Arbitration Applications are accordingly allowed. No costs. _______________ G. ROHINI, J Date: 19.04.2011 KLP