In a recent legal case, the court delved into the intricacies of appointing a Sole Arbitrator under the 1996 Act. The focus was on the absence of provisions for raising counter-claims under the MSMED Act and the agreement between parties to refer all disputes under the 1996 Act. The court’s rationale for appointing a Sole Arbitrator in this particular case sheds light on the legal analysis at play. Let’s dive deeper into the complexities of arbitration and legal proceedings.
Facts
- Disputes arose regarding claims raised by the Contractor which led to a legal notice seeking payment of outstanding dues.
- Respondent filed a Petition under Section 11(6) of the 1996 Act for appointment of arbitrator as per the Development Agreement.
- High Court observed no provision under the MSMED Act for reference of counter-claims to the Facilitation Council.
- Appellant registered under the MSMED Act and filed for dispute resolution before the Facilitation Council.
- Sections 15 to 18 of the MSMED Act allow reference of disputes by a contractor registered under the Act.
- No provision in the MSMED Act to handle counter-claims against the supplier-contractor.
- Respondent invoked arbitration under Clause 20 of the Agreement and nominated its arbitrator.
- Contractor directed to appoint an arbitrator after the Respondent’s nomination.
- Appellant-Contractor challenged the order before the Court through a Special Leave Petition.
- Parties agreed to have their disputes resolved under the Arbitration & Conciliation Act by a Court-appointed Sole Arbitrator.
- Civil Appeal filed by the Appellant-Contractor to challenge the Order of the Madras High Court.
- High Court’s view on the absence of provision for raising counter-claims under the MSMED Act.
- Agreement between parties to refer all disputes under the 1996 Act.
- Rationale for appointing an arbitrator in this particular case.
Also Read: Analysis of Consent Orders and Appellants’ Rights
Decision
- Justice K. Kannan, former Judge of the Madras High Court, appointed as Sole Arbitrator.
- Appointment subject to Declarations under Section 12 of the Arbitration and Conciliation Act, 1996.
- Pending applications disposed off.
- Arbitration will be conducted by a three-member tribunal instead of a sole arbitrator as per the agreement.
- Arbitration to be in accordance with the Arbitration and Conciliation Act, 1996.
- Arbitral proceedings to be conducted by the Madras High Court Arbitration Centre.
- Application under the MSMED Act by the Appellant-Contractor closed by Facilitation Council, Pune.
- Appeal disposed of according to the aforementioned terms.
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Case Title: GR GREEN LIFE ENERGY PVT. LTD. Vs. LEITWIND SHRIRAM MANUFACTURING PRIVATE LIMITED (2021 INSC 107)
Case Number: C.A. No.-000692-000692 / 2021
