Section 11(6) of the Arbitration and Conciliation Act, 1996 speaks about the Sole Arbitrator, were as the present petition was also been filed by the petitioner for seeking the above matter, and the same issue was held in the judgement passed by a single bench judge comprising HON’BLE MR. JUSTICE SURESH KUMAR KAIT, in the matter OFB TECH PVT. LTD V. KLSR INFRATECH LTD dealt with an issue mentioned above.
Petitioner was a person who owned a Private Limited Company incorporated under the erstwhile provisions of the Companies Act. Petitioner is inter-alia engaged in the Business-to-Business (B2B) trading and supply of raw materials to Small and Medium Enterprises and other Corporates. On the other hand, the respondent is also a company incorporated under the erstwhile provisions of the Companies Act. Respondent is inter-alia engaged in the business of Infrastructure.
According to the petitioner, a Master Facilities Agreement dated 25.06.2019 was executed between Oxyzo and respondent for providing financing facility to the respondent of Rs.10 Crores, wherein petitioner signed as a confirming party. Wherein Respondent also entered into a Memorandum of Understanding dated 25.06.2019 with petitioner for availing Working Capital Facility of Rs.10 Crores to purchase raw material.
Respondent defaulted in its payment schedule in terms of the Memorandum of Understanding dated 25.06.2019 executed with the petitioner as well as the payment schedule agreed with Oxyzo, therefore, the ARB.P. 949/2021 petitioner issued an email, setting out the default on the part of the respondent. Were it was mentioned that the due amount was categorically laid down in the said email, which for the petitioner and Oxyzo amounted to Rs.22,62,60,592/-.
Respondent replied alleging that dues of the petitioner have not been cleared as payments have not been received by respondent from the Government due to Covid. However, the respondent did not dispute the amount and its liability as detailed by the petitioner in its email. Thereafter, certain disputes arose between the parties regarding dues amounting to Rs.3,31,39,697/- with interest.
Learned counsel for respondent accepts notice and submits that he has no objection if the present petition is allowed and a Sole Arbitrator may be ARB.P. 949/2021 appointed to adjudicate the dispute between the parties subject to all issues to remain open before the learned Arbitrator be appointed.
The court perused the facts and argument’s presented, it thought that- “The learned Arbitrator shall ensure compliance of Section 12 of Arbitration and Conciliation Act, 1996 before commencing the arbitration. 13. With aforesaid directions, the present petition is, accordingly, disposed of”.
Judgment Reviewed by: Mandira BS