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| The Tax Publishers 2020 TaxPub(CL) 1434 (SC) ARBITRATION AND CONCILIATION ACT, 1996
Section 11
Though seller filed an application under section 11 for appointment of a sole arbitrator, but Arbitral Tribunal had already been constituted in terms of main agreement, which would also govern dispute with regard to price and terms of payment, thus, filing of application by invoking purchase order was not bona fide and therefore, the application was dismissed.
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Appointment of arbitrators - Application for appointment of a sole arbitrator - Arbitral Tribunal already constituted in terms of main agreement - Whether filing of application by seller invoking arbitration clause provided in purchase order being bona fide
Seller (BAL) filed an application under section 11 for appointment of a sole arbitrator to adjudicate upon all disputes with regard to price and terms of payment including, recovery, etc. that had arisen between the parties in connection with purchase orders. Purchaser (MLLC) raised objections that Arbitral Tribunal had already been constituted in terms of main agreement dt. 31-03-2018. Therefore, the application filed by the seller seeking appointment of Arbitral Tribunal in terms of Clause 7 of the purchase order was not bona fide and the application was liable to be dismissed.Held: When the parties had entered into the agreement dt. 31-03-2018 and there was consensus ad-idem to the terms and conditions contained therein which was comprehensive and encompassing all terms of the transaction and such agreement also contained an arbitration clause which was different from the arbitration clause provided in the purchase order which was for the limited purpose of supply of the produce with more specific details which arose out of the agreement dt. 31-3-2018, the arbitration clause contained in the main agreement dt. 31-3-2018 would govern the parties, insofar as the present nature of dispute that had been raised by them with regard to the price and the terms of payment including recovery etc. In that view, it would not be appropriate for the applicant to invoke Clause 7 of the purchase orders, more particularly when the arbitration clause contained in the agreement dt. 31-3-2018 had been invoked and the Arbitral Tribunal had already been constituted in terms of main agreement dt. 31-03-2018. Thus, the application for appointment of a sole arbitrator was dismissed.
REFERRED :
FAVOUR : Against the applicant.
A.Y. :
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