M/S Dakshin Shelters P.Ltd vs Geeta S Johari

2. A Development Agreement-cum-General Power of Attorney (for short "Development Agreement") was executed between the parties on February 7, 2006. Certain disputes arose out of that agreement. On December 10, 2010, the respondent issued a notice to the petitioner invoking arbitration clause in the above agreement and nominated a former Judge of the High Court of Andhra Pradesh - Justice P.L.N. Sharma -on her behalf and called upon the present petitioner to nominate its arbitrator.

3. By reply dated January 10, 2011, the petitioner communicated to the respondent that since the Development Agreement has been cancelled by her, there was no question for resolution of disputes between the parties by the Arbitrator. The reply sent by the petitioner necessitated the invocation of Section 11 of the Arbitration and Conciliation Act, 1996 (for short "the Act") by the respondent and an application was made before the High Court of Andhra Pradesh requesting the Chief Justice or the Designate Judge to appoint the arbitrator/arbitrators to decide the disputes arising out of the above agreement.

4. On hearing the parties, the Designate Judge by his order dated September 9, 2011 appointed Mr. D.V. Seetharama Murthy, Sr. Advocate as an arbitrator on behalf of the petitioner (respondent therein). It was further observed in the order that the arbitrator nominated by the applicant (present respondent) and the arbitrator appointed by the Designate Judge on behalf of the petitioner (respondent therein) are required to appoint the third arbitrator before entering into reference.

5. The order dated September 9, 2011 is under challenge in this Special Leave Petition.

6. On December 16, 2011, a limited notice was issued by this Court to the respondent. The order issuing notice reads as follows:

Certain disputes arose out of the above agreement between the parties. On December 10, 2010, the present respondent issued a notice to the petitioner invoking the arbitration clause in the above agreement and nominated a former Judge of the High Court of Andhra Pradesh - Justice P.L.N. Sharma -on her behalf calling upon the present petitioner to nominate its arbitrator.

3. By reply dated January 10, 2011, the petitioner communicated to the present respondent that since the Development Agreement itself has been cancelled by the present respondent, there is no occasion for resolution of disputes between the parties by the Arbitrator. The reply sent by the petitioner necessitated the invocation of Section 11 of the Arbitration and Conciliation Act, 1996 (for short "the Act") by the present respondent and an application was made before the High Court of Andhra Pradesh requesting the Chief Justice or the designate Judge to appoint the arbitrator-arbitrators to decide the disputes arising out of the above agreement.

4. On hearing the parties, the designate Judge by his order dated September 9, 2011 appointed Mr. D.V. Seetharama Murthy, Sr. Advocate as an arbitrator on behalf of the petitioner (respondent therein) for adjudication of the disputes between the parties. It was further observed in the order that the arbitrator nominated by the present respondent-cum-applicant therein and the arbitrator appointed by the designate Judge on behalf of the present petitioner are required to appoint the third arbitrator before entering into a reference.

15. The petitioner did respond to the above notice within 30 days of its receipt by sending its reply on January 10, 2011. Various pleas were raised in that reply and ultimately, the petitioner responded by stating "it is stated that the question of appointment of Arbitrator does not raise either from your side or from our side. There is no arbitral dispute to be decided by the arbitrator."

19. The order impugned in the present Special Leave Petition does not suffer from any infirmity. Special Leave Petition is, accordingly, dismissed with costs. The amount of Rs. one lakh deposited by the petitioner in the Registry of this Court shall be paid to the respondent.

Petition(s) for Special Leave to Appeal (Civil) No(s).33448/2011 (From the judgement and order dated 09/09/2011 in AA No.41/2011 of The HIGH COURT OF A.P AT HYDERABAD) M/S DAKSHIN SHELTERS P.LTD. Petitioner(s) VERSUS GEETA S. JOHARI Respondent(s) ( office report for direction ) Date: 21/02/2012 This Petition was called on for hearing today. CORAM :

5. It is the order dated September 9, 2011 which is under challenge in this Special Leave Petition.

7. In compliance of the above order, the petitioner has deposited Rs. 1 lakh in the Registry of this Court towards the costs of the respondent.

25.3 Mechanism and Procedure: The procedure to be followed shall be decided by the Tribunal. The directions/award of the Tribunal shall be final and binding on the parties."

17. The petitioner did respond to the above notice by sending its reply on January 10, 2011.

18. Various pleas were raised in that reply and ultimately, the petitioner responded by stating that "it is stated that the question of appointment of Arbitrator does not raise either from your side or from our side. There is no arbitral dispute to be decided by the arbitrator."

19. From the above response, no doubt is left that the petitioner failed to appoint its arbitrator on receipt of the request to do so from the respondent.

21. The order impugned in the present Special Leave Petition does not suffer from any infirmity and is dismissed. The amount of Rs. one lakh deposited by the petitioner in the Registry of this Court shall be paid to the respondent.