Pawan Kant Singh, Advs.) vs SORTING HAT SOLUTIONS PVT LTD
Case Details
Acts & Sections
Cited in this judgment
(Through: Mr. Amandeep Singh, Mr. Gaurav Chhabra and Mr. Pawan Kant Singh, Advs.) .....PETITIONER versus SORTING HAT SOLUTIONS PVT LTD REGISTERED OFFICE AT: MARUTHI INFOTECH CENTRE, 5TH FLOOR, B-BLOCK, KORAMANGALA INNER RING ROAD, DOMLUR EXTENSION, BANGALORE – 560071 (Through: Dr. Anurag Bhardwaj, Adv.) .....RESPONDENT HON'BLE MR. JUSTICE PURUSHAINDRA KUMAR KAURAV Signature Not Verified Signed By:NEHA CHOPRA Signing Date:23.05.2025 15:26:22 Signature Not Verified Signed By: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 appointment of an Arbitrator, to adjudicate upon the disputes which have arisen between the parties under the Registered Lease deed dated
06.03.2024. 2. The facts of the case would indicate that the parties have entered into a Registered Lease deed dated 06.03.2024, with respect to shop bearing No.53, situated at Old Rajinder Nagar Market, New Delhi. By way of said lease, the property was leased out to the respondent for a total period of three years/thirty-six months. 3. Learned counsel for the petitioner submits that the respondent without complying with the terms of the lease deed, vide email dated 31.08.2024, terminated the said lease deed and vacated the said property. The petitioner contends that the legal notice dated 04.09.2024 was issued calling upon the respondent to comply with the terms of the said lease deed and to pay an amount of Rs.19,95,000/-. 4. A reply has been filed by the respondent. It is stated in the reply that the petitioner has failed to comply with the agreed dispute resolution mechanism by not engaging in mutual consultation for the appointment of an arbitrator, as mandated by Clause 24. 5. I have heard the learned counsel for the parties and have perused the record. 6. It emerges from the record that a legal notice dated 04.09.2024 was Signature Not Verified Signed By:NEHA CHOPRA Signing Date:23.05.2025 15:26:22 Signature Not Verified Signed By:PURUSHAINDRA KUMAR KAURAV sent by the petitioner and, thereafter, a notice under Section 21 of the 1996 Act was also issued on 12.10.2024. It is, seen, that an endeavour was made for amicable resolution which has not been successful. At this stage, any further engagement in mutual consultation is also not warranted as the parties during the course of hearing, as well, have not arrived on any mutually agreed Arbitrator. 7. The Court takes note of the Clause 24 of the Registered Lease deed dated 06.03.2024, reads as under:- “24. Dispute: That any dispute or differences between the parties hereto relating to or arising out of this Lease Deed (including any dispute or differences as to the existence or validity hereof) shall be referred for Arbitration by a sole arbitrator and the decision of the arbitrator who shall be appointed by the Parties with mutual consent, shall be final and binding on the Parties. The Arbitration shall be conducted in accordance with the provisions or Arbitration and Conciliation Act, 1996 and/or any statutory modification or re-enactment thereof and the venue and seat of arbitration proceedings has been specified under Annexure A. The expenses of the Arbitration proceedings shall be borne by each party in equal proportion or as per the decision of the arbitrator”
8. 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 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 1 2024 SCC OnLine SC 1754. Signature Not Verified Signed By:NEHA CHOPRA Signing Date:23.05.2025 15:26:22 Signature Not Verified Signed By:PURUSHAINDRA KUMAR KAURAV 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 law and caused unnecessary harassment to the other parties to the arbitration. 12. It is thus seen that the Supreme Court has deferred the adjudication of
(Through: Mr. Amandeep Singh, Mr. Gaurav Chhabra and Mr. Pawan Kant Singh, Advs.) .....PETITIONER versus SORTING HAT SOLUTIONS PVT LTD REGISTERED OFFICE AT: MARUTHI INFOTECH CENTRE, 5TH FLOOR, B-BLOCK, KORAMANGALA INNER RING ROAD, DOMLUR EXTENSION, BANGALORE – 560071 (Through: Dr. Anurag Bhardwaj, Adv.) .....RESPONDENT HON'BLE MR. JUSTICE PURUSHAINDRA KUMAR KAURAV Signature Not Verified Signed By:NEHA CHOPRA Signing Date:23.05.2025 15:26:22 Signature Not Verified Signed By: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 appointment of an Arbitrator, to adjudicate upon the disputes which have arisen between the parties under the Registered Lease deed dated
06.03.2024. 2. The facts of the case would indicate that the parties have entered into a Registered Lease deed dated 06.03.2024, with respect to shop bearing No.53, situated at Old Rajinder Nagar Market, New Delhi. By way of said lease, the property was leased out to the respondent for a total period of three years/thirty-six months. 3. Learned counsel for the petitioner submits that the respondent without complying with the terms of the lease deed, vide email dated 31.08.2024, terminated the said lease deed and vacated the said property. The petitioner contends that the legal notice dated 04.09.2024 was issued calling upon the respondent to comply with the terms of the said lease deed and to pay an amount of Rs.19,95,000/-. 4. A reply has been filed by the respondent. It is stated in the reply that the petitioner has failed to comply with the agreed dispute resolution mechanism by not engaging in mutual consultation for the appointment of an arbitrator, as mandated by Clause 24. 5. I have heard the learned counsel for the parties and have perused the record. 6. It emerges from the record that a legal notice dated 04.09.2024 was Signature Not Verified Signed By:NEHA CHOPRA Signing Date:23.05.2025 15:26:22 Signature Not Verified Signed By:PURUSHAINDRA KUMAR KAURAV sent by the petitioner and, thereafter, a notice under Section 21 of the 1996 Act was also issued on 12.10.2024. It is, seen, that an endeavour was made for amicable resolution which has not been successful. At this stage, any further engagement in mutual consultation is also not warranted as the parties during the course of hearing, as well, have not arrived on any mutually agreed Arbitrator. 7. The Court takes note of the Clause 24 of the Registered Lease deed dated 06.03.2024, reads as under:- “24. Dispute: That any dispute or differences between the parties hereto relating to or arising out of this Lease Deed (including any dispute or differences as to the existence or validity hereof) shall be referred for Arbitration by a sole arbitrator and the decision of the arbitrator who shall be appointed by the Parties with mutual consent, shall be final and binding on the Parties. The Arbitration shall be conducted in accordance with the provisions or Arbitration and Conciliation Act, 1996 and/or any statutory modification or re-enactment thereof and the venue and seat of arbitration proceedings has been specified under Annexure A. The expenses of the Arbitration proceedings shall be borne by each party in equal proportion or as per the decision of the arbitrator”
8. 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 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 1 2024 SCC OnLine SC 1754. Signature Not Verified Signed By:NEHA CHOPRA Signing Date:23.05.2025 15:26:22 Signature Not Verified Signed By:PURUSHAINDRA KUMAR KAURAV 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 law and caused unnecessary harassment to the other parties to the arbitration. 12. It is thus seen that the Supreme Court has deferred the adjudication of