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An e-mail satisfies the requirement of a written agreement between the parties as envisaged in Section 7 (4) (b) of the Arbitration Act: High Court of Delhi

Section 7 of the Arbitration and Conciliation Act, 1996, stipulates that an arbitration agreement is in writing, if it is contained in exchange of letters, italics telegrams or other means of telecommunications including communication through electronic means and the same was upheld by High Court of Delhi through the learned bench led by JUSTICE SANJEEV SACHDEVA in the case of M/S SUDHIR POWER PROJECTS LTD. vs. M/S UNIPOWER PROJECTS PVT. LTD. [ARB.P. 1199/2021] on 30.03.2022.

The facts of the case are that the parties had entered into an agreement and a work order was placed on the respondent which contained an arbitration clause. According to which any dispute or difference whatsoever arising between the parties out of or relating to the construction, meaning, scope operation or effect of this contract or the validity or the breach thereof shall be settled by arbitration in accordance with Arbitration and Conciliation Act, 1996 and the award made in pursuance thereof shall be binding on the parties. Therefore, petitioner seeks appointment of an Arbitrator under Section 11(5) of the Arbitration & Conciliation Act, 1996.

Learned counsel for the petitioner submits that the registered office of both petitioner as well as respondent is in Delhi and accordingly petitioner has exercised the option to approach the Courts at Delhi. However, the Respondent by their email raised certain issues with regard to the terms of payment. It was submitted that only objection raised by the respondent in these proceedings to the appointment of an Arbitrator is that is there is no written agreement between the parties. The email by which the Purchase Order and the terms therein have been accepted were not denied.

Learned counsel for the respondent submitted that the purchase of order referred to by the petitioner is merely a work order and not a purchase order. Perusal of the Purchase Order shows that the same bears a heading “work order/contract”. The email with which the same has been sent mentions the same as a Purchase Order.

The Court held that the said exchange of correspondence clearly satisfies the requirement of a written agreement between the parties as envisaged in Section 7 (4) (b) of the Arbitration Act as none of the emails or the communication placed on record by the petitioner are denied by the respondent. It was observed that “Section 7 of the Arbitration and Conciliation Act, 1996, interalia, stipulates that an arbitration agreement is in writing, if it is contained in exchange of letters, italics telegrams or other means of telecommunications including communication through electronic means.”

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Judgment reviewed by – Shristi Suman

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