Mr. Rohit Taneja, Adv.) v. CDS INFRA PROJECTS LIMITED HAVING REGISTERED OFFICE AT

(Through: Mr. Rohit Taneja, Adv.) versus CDS INFRA PROJECTS LIMITED HAVING REGISTERED OFFICE AT: B-94, OKHLA PHASE-II, DELHI -110020 ALSO AT: 888, UDYOG VIHAR PHASE-5, SECTOR 20 GURUGRAM-122015 (Through: Mr. Ankur Sinhal, Adv.) .....RESPONDENT HON'BLE MR. JUSTICE PURUSHAINDRA KUMAR KAURAV JUDGEMENT PURUSHAINDRA KUMAR KAURAV, J. (ORAL)

1. The present petition has been filed under Section 11 of the Arbitration and Conciliation Act, 1996 (the 1996 Act) by the petitioner, seeking Signature Not Verified Signed By:DEEPAK BISSYAN Signing Date:16.05.2025 11:03:48 Signature Not Verified Signed By:PURUSHAINDRA KUMAR KAURAV appointment of an Arbitrator, to adjudicate upon the disputes that have arisen between the parties under the Work Order dated 28.01.2021. 2. Though learned counsel for the respondent endeavored to persuade this Court that the jurisdiction to appoint an Arbitrator does not vest with this Court. He, however, fairly submits, upon instructions, that the respondent shall raise the said objection before the Arbitral Tribunal. Reserving liberty to raise all objections, before the learned Arbitrator, he submits that the arbitrator can be appointed. 3. I have heard the learned counsel for the parties and have perused the record. 4. The Court takes note of the Clause 20 of the Work Order dated

28.01.2021, which reads as under:- “20. Settlement of Dispute: Dispute, if any, between the parties shall be settled in accordance with the Arbitration &. Conciliation Act, 1996. 'Sole Arbitrator• shall be appointed by the Managing Director of CDSIPL. Proceeding shall be conducted at Delhi. The courts at Delhi alone shall have the exclusive jurisdiction \n at\ matters such as disputes, questions or differences of opinion between both the parties concerning or arising under the contract”

5. The law with respect to the scope and standard of judicial scrutiny under Section 11(6) of the 1996 Act has been fairly well settled. This Court as well in the order dated 24.04.2025 in case of ARB.P. 145/2025 titled as Pradhaan Air Express Pvt Ltd v. Air Works India Engineering Pvt Ltd has extensively dealt with the scope of interference at the stage of Section 11. The Court held as under:-

9. “The law with respect to the scope and standard of judicial scrutiny under Section 11(6) of the 1996 Act has been fairly well settled. The Supreme Court in the case of SBI General Insurance Co. Ltd. v. Krish Spinning,1 1 2024 SCC OnLine SC 1754. Signature Not Verified Signed By:DEEPAK BISSYAN Signing Date:16.05.2025 11:03:48 Signature Not Verified Signed By:PURUSHAINDRA KUMAR KAURAV while considering all earlier pronouncements including the Constitutional Bench decision of seven judges in the case of Interplay between Arbitration Agreements under the Arbitration & Conciliation Act, 1996 & the Indian Stamp Act, 1899, In re 2 has held that scope of inquiry at the stage of appointment of an Arbitrator is limited to the extent of prima facie existence of the arbitration agreement and nothing else. 10. It has unequivocally been held in paragraph no.114 in the case of SBI General Insurance Co. Ltd that observations made in Vidya Drolia v. Durga Trading Corpn.,3 and adopted in NTPC Ltd. v. SPML Infra Ltd.,4 that the jurisdiction of the referral court when dealing with the issue of “accord and satisfaction” under Section 11 extends to weeding out ex-facie non-arbitrable and frivolous disputes would not apply after the decision of Re: Interplay. The abovenoted paragraph no.114 in the case of SBI General Insurance Co. Ltd reads as under:- “114. In view of the observations made by this Court in In Re: Interplay (supra), it is clear that the scope of enquiry at the stage of appointment of arbitrator is limited to the scrutiny of prima facie existence of the arbitration agreement, and nothing else. For this reason, we find it difficult to hold that the observations made in Vidya Drolia (supra) and adopted in NTPC v. SPML (supra) that the jurisdiction of the referral court when dealing with the issue of “accord and satisfaction” under Section 11 extends to weeding out ex-facie non-arbitrable and frivolous disputes would continue to apply despite the subsequent decision in In Re: Interplay (supra).”

11. Ex-facie frivolity and dishonesty are the issues, which have been held to be within the scope of the Arbitral Tribunal which is equally capable of deciding upon the appreciation of evidence adduced by the parties. While considering the aforesaid pronouncements of the Supreme Court, the Supreme Court in the case of Goqii Technologies (P) Ltd. v. Sokrati Technologies (P) Ltd.,5 however, has held that the referral Courts under Section 11 must not be misused by one party in order to force other parties to the arbitration agreement to participate in a time-consuming and costly arbitration process. Few instances have been delineated such as, the adjudication of a non-existent and malafide claim through arbitration. The Court, however, in order to balance the limited scope of judicial interference of the referral Court with the interest of the parties who might be constrained to participate in the arbitration proceedings, has held that the Arbitral Tribunal eventually may direct that the costs of the arbitration shall be borne by the party which the Arbitral Tribunal finds to have abused the process of

(Through: Mr. Rohit Taneja, Adv.) versus CDS INFRA PROJECTS LIMITED HAVING REGISTERED OFFICE AT: B-94, OKHLA PHASE-II, DELHI -110020 ALSO AT: 888, UDYOG VIHAR PHASE-5, SECTOR 20 GURUGRAM-122015 (Through: Mr. Ankur Sinhal, Adv.) .....RESPONDENT HON'BLE MR. JUSTICE PURUSHAINDRA KUMAR KAURAV JUDGEMENT PURUSHAINDRA KUMAR KAURAV, J. (ORAL)

1. The present petition has been filed under Section 11 of the Arbitration and Conciliation Act, 1996 (the 1996 Act) by the petitioner, seeking Signature Not Verified Signed By:DEEPAK BISSYAN Signing Date:16.05.2025 11:03:48 Signature Not Verified Signed By:PURUSHAINDRA KUMAR KAURAV appointment of an Arbitrator, to adjudicate upon the disputes that have arisen between the parties under the Work Order dated 28.01.2021. 2. Though learned counsel for the respondent endeavored to persuade this Court that the jurisdiction to appoint an Arbitrator does not vest with this Court. He, however, fairly submits, upon instructions, that the respondent shall raise the said objection before the Arbitral Tribunal. Reserving liberty to raise all objections, before the learned Arbitrator, he submits that the arbitrator can be appointed. 3. I have heard the learned counsel for the parties and have perused the record. 4. The Court takes note of the Clause 20 of the Work Order dated

28.01.2021, which reads as under:- “20. Settlement of Dispute: Dispute, if any, between the parties shall be settled in accordance with the Arbitration &. Conciliation Act, 1996. 'Sole Arbitrator• shall be appointed by the Managing Director of CDSIPL. Proceeding shall be conducted at Delhi. The courts at Delhi alone shall have the exclusive jurisdiction \n at\ matters such as disputes, questions or differences of opinion between both the parties concerning or arising under the contract”

5. The law with respect to the scope and standard of judicial scrutiny under Section 11(6) of the 1996 Act has been fairly well settled. This Court as well in the order dated 24.04.2025 in case of ARB.P. 145/2025 titled as Pradhaan Air Express Pvt Ltd v. Air Works India Engineering Pvt Ltd has extensively dealt with the scope of interference at the stage of Section 11. The Court held as under:-

9. “The law with respect to the scope and standard of judicial scrutiny under Section 11(6) of the 1996 Act has been fairly well settled. The Supreme Court in the case of SBI General Insurance Co. Ltd. v. Krish Spinning,1 1 2024 SCC OnLine SC 1754. Signature Not Verified Signed By:DEEPAK BISSYAN Signing Date:16.05.2025 11:03:48 Signature Not Verified Signed By:PURUSHAINDRA KUMAR KAURAV while considering all earlier pronouncements including the Constitutional Bench decision of seven judges in the case of Interplay between Arbitration Agreements under the Arbitration & Conciliation Act, 1996 & the Indian Stamp Act, 1899, In re 2 has held that scope of inquiry at the stage of appointment of an Arbitrator is limited to the extent of prima facie existence of the arbitration agreement and nothing else. 10. It has unequivocally been held in paragraph no.114 in the case of SBI General Insurance Co. Ltd that observations made in Vidya Drolia v. Durga Trading Corpn.,3 and adopted in NTPC Ltd. v. SPML Infra Ltd.,4 that the jurisdiction of the referral court when dealing with the issue of “accord and satisfaction” under Section 11 extends to weeding out ex-facie non-arbitrable and frivolous disputes would not apply after the decision of Re: Interplay. The abovenoted paragraph no.114 in the case of SBI General Insurance Co. Ltd reads as under:- “114. In view of the observations made by this Court in In Re: Interplay (supra), it is clear that the scope of enquiry at the stage of appointment of arbitrator is limited to the scrutiny of prima facie existence of the arbitration agreement, and nothing else. For this reason, we find it difficult to hold that the observations made in Vidya Drolia (supra) and adopted in NTPC v. SPML (supra) that the jurisdiction of the referral court when dealing with the issue of “accord and satisfaction” under Section 11 extends to weeding out ex-facie non-arbitrable and frivolous disputes would continue to apply despite the subsequent decision in In Re: Interplay (supra).”

11. Ex-facie frivolity and dishonesty are the issues, which have been held to be within the scope of the Arbitral Tribunal which is equally capable of deciding upon the appreciation of evidence adduced by the parties. While considering the aforesaid pronouncements of the Supreme Court, the Supreme Court in the case of Goqii Technologies (P) Ltd. v. Sokrati Technologies (P) Ltd.,5 however, has held that the referral Courts under Section 11 must not be misused by one party in order to force other parties to the arbitration agreement to participate in a time-consuming and costly arbitration process. Few instances have been delineated such as, the adjudication of a non-existent and malafide claim through arbitration. The Court, however, in order to balance the limited scope of judicial interference of the referral Court with the interest of the parties who might be constrained to participate in the arbitration proceedings, has held that the Arbitral Tribunal eventually may direct that the costs of the arbitration shall be borne by the party which the Arbitral Tribunal finds to have abused the process of