Mr. Parvez Bashista and Mr. Malay Misra, Advs v. BRIGHT GREEN ENERGY PVT. LTD. Through

.....Petitioner Through: Mr. Parvez Bashista and Mr. Malay Misra, Advs. versus BRIGHT GREEN ENERGY PVT. LTD. Through: Mr. Nadeem Saifi, Adv. .....Respondent CORAM: HON'BLE MR. JUSTICE PURUSHAINDRA KUMAR KAURAV JUDGEMENT PURUSHAINDRA KUMAR KAURAV, J. (ORAL) The present petition has been filed under Section 11 of the Arbitration and Conciliation Act, 1996 (the Act), seeking appointment of an Arbitrator, to adjudicate upon the disputes that have arisen between the parties. 2. The facts of the case would indicate that the petitioner-company entered into an agreement dated 01.04.2022 with the respondent for the procurement and transfer of land for 31 Wind Turbine Generators located in Ottapidaram Taluk, Tuticorin District, Tamil Nadu. The petitioner appears to have paid certain advance. 3. According to the petitioner, the respondent have failed to complete Signature Not Verified Signed By:PRIYA Signing Date:01.12.2025 17:19:06 Signature Not Verified Signed By:PURUSHAINDRA KUMAR KAURAV due diligence and other contractual obligations and did not return the remaining advance to the tune of Rs.68,78,540/-. The petitioner submits that various reminders were sent and even notice under Section 21 of the Act, was issued on 07.07.2025. 4. Clause 18.1 of the agreement dated 01.04.2022, clearly contains an arbitration clause, which is extracted as under: ―18. Dispute Resolution- 18.1. Any dispute,' difference, or disagreement' which may arise from, relating to, in connection with this Agreement or any other documents executed in connection with this Agreement at any time hereafter, between the Parties hereto, shall be referred to arbitration to sole arbitrator to be mutually appointed by the Parties. The arbitration shall be conducted in accordance with the Arbitration and Conciliation Act, 1996 as amended from time to time. The decision of the sole arbitrator shall be final .and binding on the parties to this Agreement. The seat and venue of arbitration shall be at New Delhi. 18.2 The arbitral tribunal shall be at liberty to award cost of proceedings including not limited to attorney's fee, out of pocket expenses. 18.3. During the subsistence of any arbitration, the Parties shall continue to exercise their remaining rights and continue to fulfil all their respective duties and obligation under this Agreement without prejudice to the final determination in accordance with the provisions under this clause. Without prejudice to and subject to the indemnification provisions in this Agreement, the Parties shall equally bear the costs incurred in the arbitration unless otherwise awarded or fixed by the arbitral tribunal. 18.4. The provisions of this clause shall survive Termination.‖

5. The law with respect to the scope and standard of judicial scrutiny under Section 11(6) of the Act is no longer res integra. This Court in Pradhaan Air Express Pvt Ltd v. Air Works India Engineering Pvt Ltd1, has extensively dealt with the scope of interference at the stage of Section 11. Furthermore, in Axis Finance Limited Vs. Mr. Agam Ishwar Trimbak,2 this Court has held that the scope of inquiry under Section 11 of the Act is 1 2025 SCC OnLine Del 3022 2 2025:DHC:7477 Signature Not Verified Signed By:PRIYA Signing Date:01.12.2025 17:19:06 Signature Not Verified Signed By:PURUSHAINDRA KUMAR KAURAV limited to a prima facie examination of the existence of an arbitration agreement. Further, it was also reiterated that objections relating to the arbitrability of disputes are not to be entertained by a referral Court acting under Section 8 or 11 of the Act. The relevant extract of the aforesaid decision reads as under: -

19.In In Re: Interplay , the Supreme Court confined the analysis under Section 11 of the Act to the existence of an arbitration agreement and under Section 8 of the Act to the existence and validity of an arbitration agreement. Under both the provisions, examination was to be made at the touchstone of Section 7 of the Act. Further, issues pertaining to the arbitrability of the dispute fell outside the scope of both Section 11(6A) and Section 8 of the Act. The material part of the judgement of the Supreme Court in In Re: Interplay reads as under:

164. The 2015 Amendment Act has laid down different parameters for judicial review under Section 8 and Section 11. Where Section 8 requires the referral Court to look into the prima facie existence of a valid arbitration agreement. Section 11 confines the Court’s jurisdiction to the examination of the existence of an arbitration agreement. Although the object and purpose behind both Sections 8 and 11 is to compel parties to abide by their contractual understanding, the scope of power of the referral Courts under the said provisions is intended to be different. The same is also evident from the fact that Section 37 of the Arbitration Act allows an appeal from the order of an arbitral tribunal refusing to refer the parties to arbitration under Section 8, but not from Section 11. Thus, the 2015 Amendment Act has legislatively overruled the dictum of Patel Engineering (supra) that Section 8 and Section 11 are complementary in nature. Accordingly, the two provisions cannot be read as laying down a similar standard. 165. The legislature confined the scope of reference under Section 11(6A) to the examination of the existence of an arbitration agreement. The use of the term ―examination‖ in itself connotes that the scope of the power is limited to a prima facie determination. Since the Arbitration Act is a self-contained code, the requirement of ―existence‖ of an arbitration agreement draws effect from Section 7 of the Arbitration Act. In Duro Felguera (supra), this Court held that the referral Courts only need to consider one aspect to determine the existence of an arbitration agreement – whether the underlying contract contains an arbitration agreement which provides for arbitration pertaining to the it was held Signature Not Verified Signed By:PRIYA Signing Date:01.12.2025 17:19:06 Signature Not Verified Signed By:PURUSHAINDRA KUMAR KAURAV disputes which have arisen between the parties to the agreement. Therefore, the scope of examination under Section 11(6A) should be confined to the existence of an arbitration agreement on the basis of Section 7Similarly, the validity of an arbitration agreement, in view of Section 7, should be restricted to the requirement of formal validity such as the requirement that the agreement be in writing. This interpretation also gives true effect to the doctrine of competence-competence by leaving the issue of substantive existence and validity of an arbitration agreement to be decided by arbitral tribunal under Section 16. We accordingly clarify the position of law laid down in Vidya Drolia (supra) in the context of Section 8 and Section 11 of the Arbitration Act. the existence of arbitration 166. The burden of proving agreement generally lies on the party seeking to rely on such agreement. In jurisdictions such as India, which accept the doctrine of competencecompetence, only prima facie proof of the existence of an arbitration agreement must be adduced before the referral Court. The referral Court is not the appropriate forum to conduct a minitrial by allowing the parties to adduce the evidence in regard to the existence or validity of an arbitration agreement. The determination of the existence and validity of an arbitration agreement on the basis of evidence ought to be left to the arbitral tribunal. This position of law can also be gauged from the plain language of the statute. 167. Section 11(6A) uses the expression ―examination of the existence of an arbitration agreement.‖ The purport of using the word ―examination‖ connotes that the legislature intends that the referral Court has to inspect or scrutinize the dealings between the parties for the existence of an arbitration agreement. Moreover, the expression ―examination‖ does not connote or imply a laborious or contested inquiry. On the other hand, Section 16 provides that the arbitral tribunal can ―rule‖ on its jurisdiction, including the existence and validity of an arbitration agreement. A ―ruling‖ connotes adjudication of disputes after admitting evidence from the parties. Therefore, it is evident that the referral Court is only required to examine the existence of arbitration agreements, whereas the arbitral tribunal ought to rule on its jurisdiction, including the issues pertaining to the existence and validity of an arbitration agreement. A similar view was adopted by this Court in Shin-Etsu Chemical Co. Ltd. v. Aksh Optifibre Ltd.‖ [Emphasis supplied]

20. The effect of In Re: Interplay was further explained by a Three Judge Bench of the Supreme Court in SBI General Insurance Co. Ltd. v. Krish Signature Not Verified Signed By:PRIYA Signing Date:01.12.2025 17:19:06 Signature Not Verified Signed By:PURUSHAINDRA KUMAR KAURAV Spinning3 wherein the Court declared Vidya Drolia and NTPC Ltd.’s findings qua scope of inquiry under Section 8 and Section 11 of the Act to no longer be compatible with modern principles of arbitration. The material portions of the judgement read 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). … 118. Tests like the ―eye of the needle‖ and ―ex-facie meritless‖, although try to minimise the extent of judicial interference, yet they require the referral Court to examine contested facts and appreciate prima facie evidence (however limited the scope of enquiry may be) and thus are not in conformity with the principles of modern arbitration which place arbitral autonomy and judicial non-interference on the highest pedestal.‖ [Emphasis supplied]

21. Similarly, in BGM and M-RPL-JMCT (JV) v. Eastern Coalfields Ltd4 the Supreme Court succinctly explained the effect of In Re: Interplay on a Referral Court’s powers under Section 11 of the Act. The relevant part of the judgement is as under:

15. … (a) Section 11 confines the Court's jurisdiction to the examination regarding the existence of an arbitration agreement. (b) The use of the term ―examination‖ in itself connotes that the scope of the power is limited to a prima facie determination. (c) Referral Courts only need to consider one aspect to determine the existence of an arbitration agreement — whether the underlying contract contains an arbitration agreement which provides for arbitration pertaining to the disputes which have arisen between the parties to the agreement. Therefore, the scope of examination under Section 11(6-A) should be confined to the existence of an arbitration agreement on the basis of Section 7. Such a legal approach will help the Referral Court in weeding 3 2024 SCC OnLine SC 1754 4 2025 SCC OnLine SC 1471 Signature Not Verified Signed By:PRIYA Signing Date:01.12.2025 17:19:06 Signature Not Verified Signed By:PURUSHAINDRA KUMAR KAURAV out prima facie non-existent arbitration agreements. (d) The purport of using the word ―examination‖ connotes that the legislature intends that the Referral Court has to inspect or scrutinise the dealings between the parties for the existence of an arbitration agreement. However, the expression ―examination‖ does not connote or imply a laborious or contested inquiry. (e) The burden of proving the existence of arbitration agreement generally lies on the party seeking to rely on such agreement. Only prima facie proof of the existence of an arbitration agreement must be adduced before the Referral Court. The Referral Court is not the appropriate forum to conduct a mini- trial by allowing the parties to adduce the evidence in regard to the existence or validity of an arbitration agreement. The determination of the existence and validity of an arbitration agreement on the basis of evidence ought to be left to the Arbitral Tribunal. (f) Section 16 provides that the Arbitral Tribunal can ―rule‖ on its jurisdiction, including the existence and validity of an arbitration agreement. A ―ruling‖ connotes adjudication of disputes after admitting evidence from the parties. Therefore, when the Referral Court renders a prima facie opinion, neither the Arbitral Tribunal, nor the Court enforcing the arbitral award is bound by such a prima facie view. If a prima facie view as to the existence of an arbitration agreement is taken by the Referral Court, it still allows the Arbitral Tribunal to examine the issue in depth. [Emphasis supplied]

22. Thus from the above-mentioned authorities it is clear that a Court’s scope of inquiry under Section 11 of the Act has been limited to a prima facie examination of the existence of an arbitration agreement while the adjudication under Section 8 is to be made for both existence and validity. Further, the examination so undertaken under both the said provisions must be within the confines of Section 7 of the Act. Objections relating to arbitrability of disputes are not to be entertained by a referral Court acting under Section 8 or 11 of the Act.‖

6. In view of the fact that disputes have arisen between the parties and there is an arbitration clause in the contract, Ms. Diksha Punia, Advocate (Mobile No: +91 9958535104, e-mail id: [email protected]), is Signature Not Verified Signed By:PRIYA Signing Date:01.12.2025 17:19:06 Signature Not Verified Signed By:PURUSHAINDRA KUMAR KAURAV appointed as the sole Arbitrator. 7. The arbitration would take place under the aegis of the Delhi International Arbitration Centre (DIAC) and in terms of its rules and regulations. The learned Arbitrator shall be entitled to fees as per the Schedule of Fees maintained by the DIAC. 8. The learned arbitrator is also requested to file the requisite disclosure under Section 12 (2) of the Act within a week of entering on reference. 9. All rights and contentions of the parties in relation to the claims/counter-claims are kept open, to be decided by the Sole Arbitrator on their merits, in accordance with law. 10. Needless to say, nothing in this order shall be construed as an expression of opinion of this Court on the merits of the controversy between the parties. Let a copy of the instant order be sent to the Sole Arbitrator through electronic mode as well. 11. Accordingly, the instant petition stands disposed of. NOVEMBER 21, 2025/p/mj PURUSHAINDRA KUMAR KAURAV, J Signature Not Verified Signed By:PRIYA Signing Date:01.12.2025 17:19:06 Signature Not Verified Signed By:PURUSHAINDRA KUMAR KAURAV