The High Court · 2025

Order

':ll'i' -! THE HONOURABLE SRI JUSTICE N.V. SHRAVAN KUMAR Arbitration Application No.49 of 2o24 ORDER: This Application is hled under Section 11(6) of Arbitra[ion and Conciliation ,A,ct, 1996 (for short 'the 1996 Act' hereir after) seeking appointment of arbitrator for adjudicating the disputer; between the Applicant ancl Rcspondent No. 1.

2. The lrricf facts as stated in the present Arbitratirrn Application and in Agrec'ment dated 2O.O3.2O2O are that the Ap rlicalt was a successful bi,lder and was awarded with work pertainir.g to spil1 way and powerhouse of Koteswar Hydro Electric Project a t Tehri Dam, Uttarakhand. The Applicant entered lhto an agreement dated

14.tL2OO2 rvith Tehri Hydro Electric Developmer:.1 Corporation Limited (her,:inafter referred as 'tHDC). Later resl)ondent No.3 approached t he applicant and participated in the wo:k. When the work was in progress, certain disputes arose between the Applicant and THDC and legal proceedings were initiated and ar. award dated

17.12.2010 u'as passed. The said award was challenged before the Hon'ble High Court of Delhi and in the said backgrorrnd, the High Court of Delhi passed orders on 13.12.2019 in O.M.P.Nr. 100 of 2011 and I.A.No.1t;20O ol.2Ol9 in OMP No.100 of 2011 dire<:ting THDC to deposit an amount of Rs.4,5O,OO,00O/- within a period of six (6) weeks r l i 2 ITVSK, J and further permitted the Applicant to withdraw such amounts by submitting Bank Guarantees as securities.

3. Thereafter, respondent No.3 approached the Applicant and agreed for opening the Escrow account for depositing the above amounts, accordingly respondent No. 1 wai appointed as Escrow Agent and an agreement dated 2o.o3.2o20 was entered between the parties. The terms of the Escrow Agreement are that: (i) Respondent No.3 will provide 100% Bank Guarantees needed as per the agreement. (ii) Applicant will open a designated bank account with respondent No.2 with an Escrow Agreement to deposit the money withdrawn from the Registrar, High court of Delhi to the extent of the Bank Guarantee amount issued by respondent No.2 on behalf of the Applicant ald such BG is acceptable by the Registrar, High Court of Delhi. (iii) (a) 5.5% of the above such deposit will be transferred to the Applicant or to any nominee of the Applicant,s choice arrd (b) the balance will be transferred to respondent No.3.

4. Consequent to the furnishing of the Bank Guarantee, an amount of Rs.150,00,00,000/- was deposited to the above Escrow Account No'4437oo29ooooo\27 and thereaJter the said amounts were transferred as per the Escrou, Agreement to the Applicant and respondent No.3. In view of the same, the Escrow account has l i 3 NItiK, J outlived its purpose as the actions/ transactions contemplated under the Escrow Agreement was satisfied and completed an<l stood fulfilled and it is not permissible for either of the parties to operate Escrow account in ;rny manner. In terms of clause 13 of trscrow Agreement, the agreernent shall be terminated based on the written communications of Applicant and respondent No.3. f'urther, as per clause 13.3 and 13.5 of Escrou, Agreement, the Escrovr Account shall stand closed by both the parties seeking termination of Escrow Account ani thereupon respondent No.1 will automati,:a1ly cease to be an Escrow Agent.

5. The Applicant issued ietter on 19.06.2C2O requesting respondent No,1 marking a copy to respondent No 3 to formally close the Escrow account. Respondent No.3 had also issued the letter dated

25.06.2020 intimating respondent No.l that both the parties have received thcir rcspective payments under Escrow A:+eements and therefore, sc,ught for termination of Escrow Agreement Thereafter, on

13.1O.2022, tl-re Applicant received a letter calling up,:n to update its KYC details for its Escrow Bank Account and the Appli,:ant was under impression 1.hat the Escrow Agreement was closed ancl did not update KYC details. Thereafter, the Applicant immediately issued a letter on

29.10.2022 intimating respondent No.l that both the pa-rties to the Escrow Agreement has already issued written i ostructions to t i I irral(' !, 't respondent No. 1 to alfect ciosure of Escrow Agreement. Inspite of the same, the said account was not formally closed. Thereafter, the Applicant issued another ietter on 29.1O.2022 requesting respondent No.l to terminate and close the agreement but respondent No.1 had failed to facilitate the closure of Escrow Agreement d,ated,2O.O3.2O2O.

6. It is further submitted that respondent No.3 has done forgery, fabrication of documents including creation of General power of Attorney and subject contract d,ated, 17 .02.20 1 1 and sub-contract dated 16. 11.2OO2 by forging the signatures of authorized signatory. Later an FIR No.254/2023 against Project Director of respondent No.3 in the Chilakalurupet Police Station, Andhra Pradesh was lodged which is under investigation. ThereaGr, the Applicant and its principal authorized signatory hled suits bearing O.S.No.32 of 2023 on the hle of XIII Additionat District Judge, Palnadu District at Narsaraopet and O.S.No.5l6 of 2023 on the file of XXVI Additional Chief Judge, City Civil Court to declare both the forged and fabricated documents as null and void having no lega1 effect so as to combat the fraud played by respondent No.3.

7. It is further submitted that an unauthorized person from respondent No.3 has issued an e-mail dated Ol.ll.2022 requesting respondent No. 1 from refraining and closing the Bank account by ,7 5 alleging that respon<lent No.3 is also party to Escrow A5peement and the said account may be required in future The Apprlicant further case is that there are many more transactions and receipts during the course of its overall business and there is every possibi ity that such receipts may be deposited in Escrow Account inadvertently and respondent No.3 may attempt to siphon off such amounts/receipts credited into IJscrow Account. Thereafter, the Applicant rrnder Section gofArbitrati<lnandConci1iationAct,1996filedC.o.P.}Io.54of2023 before the Principal Special Court for Trial and Disposal of Commercial Disputes, City Civil Court, Hyderabad seeking an interim relief restrainrng the respondents not to operate Bank Ar::ount bearing No.4437OO29OOO0O827 (Escrow Accountl LCB Hyder'a'bad branch' Punjab National Bank. The Special Court by an order dated 14.07.2023 in C.O.P.No.S4 of 2023 directed the respondents to maintain status quo in operating the said account' Thereafter' the interim order was extended from time to time'

8. The subject matter of the dispute against respondent No' 1 is that the Applicant and respondents entered into the Escrow Agreement on 2O.O3.2O20 for a specific purpose an I despite the purposehasbeenachievedandboththepartieshaver:ommunicated uide letters clated 19.06.2020 and 25.06.2020 regardirrg the Escrow account, the Escrow Agent did not close the said accourtt' The Escrow 't f 6 l{vsK, J 1 Agent intends to keep the Escrow Agreement open citing the reason that there is a Bank Guarantee linked to the account.

9. Clause 12 of Escrow Agreement dated 20.03.2O20 refers to dispute resolution which is extracted herein for the facility of referen ce: .DISPUTE RE,SOLUTIOM 12.1 General Except as mag be set forth elseuhere in this Agreement among the parties or between tuto parties, ang dispute arising out of or in connection uith this Agreement shall be detennined in accordance uith the prouisions of this Clause 12. 12.2. If ang di.spute arbes betueen the Parties ("Disputing Parties") h.ereto duing the subsi.stence of this Agreement, thereafter, in connecti6n tDith tlle ualiditg, interpretation, implementation or alleged mateial breach of ang prouision of thi-s Agreement or regarding a question, including the question as to u_*rcther the termination of this Agreement by one partg hereto lns been legitimate. The Di.sputing Parties hereto shall endeauor to settle such dispute amicdblA. Tte attempt to bing obout an omicable settlement shall be considered to haue failed os soor. as one of the Parties trcreto, ofier reasonable attempts, tuhich attempt shall continue for not less than 30ghirtg) dags from the date of seruice of notice of dispute by one disputing pdrtA to other in utriting (Di.spute Notice), has not receiued a fauourable response to the Di,spute notice or is of the uieut that the Dispute has not been resolued to its satisfaction. Further, ? 1 IIVSK, J anA controuersa, claim or dispute arising out of or retating to this ,Agreement uhich cannot be settted amical'ly bg the Distrtuting Parties hereto shall be resolued exchtsiuelg bg arbitratiot^t in accord-ance utith the Arbitratior'. and Conciliation Act, 1996, as amended ("Arbitration A:t")' If there is: an arbitration proceedings in accordonce with this Clause, the Parties agree as follottls: (o) In tte euent that th'ere are euen number of Disputing Porties, each such disputing partg sholl appoint 1 (one) arbitrator each ("Party Arbitrator") uithin 30 dags of tlrc receipt of the Dispute Notice and the Partg Arbitrotors so appoinled shall jointtg appoint anotLer arbitrator (Joint Arbitrator) u.tithin 5 days (Fiue) business days of the Disputing Parties appointing tlrcir party arbitrator s ' The Partg l\rbitrators and. the joint arbitrator shall fcntn the Arbitrotion Panel (Ponel) ond the Joint Arbitrotor i uill be the chairman of the panel. In the euent there ore odd numbers of Disputing Parties, each such Disputittg' Parlg shall appoint a Part7 Arbitrator and the Partg Arbi'trators so appointed sholl form the Panel' If a Disputing Partg fails to appoint its arbitrator u'tithin the period specfied in this Clause, ang other party sho,ll be entitled to m'tke an application to the releuant court for appointmenl of an arbitrator (at the clost of the defaulting Disputing Partg) and. th.e arbitrator so nominated shall be deemerl to be tlrc arbitrator nominated bg the defaulting Partg" (b) Any arbitration shatl be conducted in the 'Tnglish Langaage and any arbitration proceedings under this clause 72.2 sLnll be held in Hgderabad (c) The d.ecision of the Panel shall be final and bin'Ling on the parties v 8 !wSt(, J a\ (d) Each Partg, shall pag its oun costs including out of pocket expenses (including utithout limitation, attomeg's fees) incured bg such partg, in connection uith ang such dEpute. (e) The Parties shall continue to fulfill their obligations under this Agreement pending the final resolution of the di-spute and the parties shall not haue th-e ight to suspend their obligations under this Agreement bg uirtue of ang dispute being refered to Arbitration (fl Subject to the aboue, each of tLrc Parties submits to tte exclusiue jurisdiction of Courts at Hgderabod."

10. Thereafter, Applicant issued notice dated 12.10.2023 (notice of dispute) nominating their arbitrators and accordingly called upon the respondents to nominate their respective arbitrators in terms of clause 12 of Escrow Agreement dated 20.03.2020. The said notice was received by the respondents on L3.LO.2O2S. Respondent No.1 refused to nominate, uide their reply legal notice dated 13.10.2023 and respondent No.3 sent reply on 30.1O.2O23 denying the contents of the Notice of Dispute nominating Mr.Justice A-Rajasekhar Reddy (former Judge, High Court for the State of Telangana). Thereafter, the Applicant has issued oddendum in continuation to the Notice of Dispute and called upon respondent No. 1 to appoint its arbitrator for which there was no response, thereby refusing for arbitration. Thereafter, the applicant in order to make a different and separate claim against respondent No.3 based on disputes arising out of the 1 9 rrvsK, J memorandum of Lrnderstanding dated ll 03 '2020 and Escrow Agreement, ha.s issued notice of deferral on 13'12 2023 Io respondent Nos.2 and 3 indicating the intention of the Applicant to proceed with the resolution of ,So1e dispute with the Escrow agent' i.e ., respondent No.1. Responclent No.3 sent a reply through e'mail dated 19 l2'2O23 protesting lhe deferral and respondent No 1 did not chose to respond objecting for zLrbitration. 1 1. It is further submitted that respondent I'lc'3 has hled separate arbitration application uide A A'No'2I5 of 2O2i\ for resoiution of alleged disputes arising out of agreement dated 1Ii 11'2013' The Applicant b,,- grouping and consolidating the dis putes under agreement dated 15. 1 1 .2013 and the ancillary agreement and also the Escrow agreement clated 20.O3.2020 and also the perf<r -mance of one agreement u-hich are so intrinsically interlinked with each other sought them to be taken up into one hearing as the par 'ies concerned are same ancl also related to the same set of facts and c ircumstances. It is further submitted that by combining them would not oniy avoid conflicting awards and also waste huge time and t'esources and expenses anrl thereby Applicant considered it prudent and just and proper to make a "composite reference" and have a single arbitral Tribunai for settling the disputes arising between th: parties' The Applicant therefore frled separate arbitration applir:ation against :r 10 IIVSK, J A.A-No.49 d 2e2a respondent No.3, as such no relief is claimed against respondent No.3 arld respondent No.2 (the Bank) in the present application. Under these iircumstances, the Applicant has filed the present application for appointment of arbitrator in terms of Clause 12 of Escrow Agreement dated 20.03.2O20.

12. Respondent No.1 i.e., Chief Manager, Punjab National Bank has filed counter aflidavit and denies that there are disputes between the Applicant and respondent No. 1 and respondent Bank cannot be made as party as per the Escrow Agreement. It is submitted that as per clause 6( 1) of Escrow Agreement, the Bank will only act in independent capacity as an agent as such could not close the account without joint request of Applicant and r6spondent No.2. It is further submitted that as per clause 6.2, LL.ejoint venture will indemnify the Escrow Agent for any act done by either of the parties to the agreement. As such there is no arbitral disputes as alleged by the Applicant. It is further submitted that the Escrow Agreement dated 2O.O3.2O2O was entered between the Applicant and respondent No.3 for a specific purpose by the Applicant and respondent No.2 and respondent Bank was made only an Escrow agent for the said agreement between the parties and respondent No.3 has deposited certain amounts irr the Escrow Account and the Bank is to act as an agent for the amount deposited by respondent No.3. It is further 11 submitted theit as per clause 13.3 and 13'5 of Escrow Agreement' the Escrow account sha11 stand closed upon receipt of any communication by both the parties seeking termination. Further Applicant, addressed a letter to the Bank dated 19.06.202O requesting the BarLk to close the Escrow account and as per clause 13.4 of Escrow Agreerrent, no party shall approach unilaterally to Escrow agent Bank for termination and in the preserlt case, no unilateral termination withou.t joint written agreement is allorn ed as per terms of Escrow Agreemen[. It is further submitted that in terms of order passed in C O P No 54 of 2023 directing the respondents to maintain stalus quo antT the Escrow account has been made debit frozen by the Bank as pei the directions of the Civil Court.. In the said circumstances, res:ondent No' 1 eventually prayed this Court to dismiss the present €Lpplication appoinl.menl of arbitrator.

13. A counter afhdavit has been filed by respondertrt No 3 stating that a notice was issued by the Applicant on I2'lO2023 to respondent No.1 and respondent No.3 whercun<ler Applicant nominated Mr.Justice C.Praveen Kumar (Retd') as its nominee Arbitrator and called upon respondent Nos.1 and 3 to :rominate their respective nominee arbitrator. Respondent No.1 issued reply notice dated 13.10.2023 stating that it is not a benehciary to the Escrow Account ancl is only an Escrow Agent and it has rto locus in the :l 12 disputes between the Applicant and respondent No.3. Respondent No.3 has also issued reply dated I5.1O.2023 nominating Mr.Justice A.RajaSekhar Reddy (Retd.) as its nominee arbitrator. It is further submitted that after appointment of arbitrator, the Applicant did not take any steps for commencing the arbitration proceedings as such respondent No.3 issued notice dated 25.11.2023 to the arbitrators to commence the arbitration proceedings and a copy of the letter has also been sent to the Applicant. Thereafter, the Applica:nt issued addendum notice dated 04 .12.2023 and also issued a notice of deferral dated 13.12.2023 which was replied by respondent No.3 by letter dated 18.12.2023 calling upon the Appricant to come forward for arbitration proceedings. The Arbitrators in consultation have appointed Mr.Justice R.Subhash Reddy (Retd.) as presiding arbitrator. Thereafter, the presiding arbitrator issued notice on 03.O1.2O24 and fixed preliminar5r hearing on 72.01.2024 for which the Applicant as well as their authorized representative raised objections uia e-rnanl on the same day with regard to the constitution of the arbitral tribunal and thereafter the arbitral tribunal hxed date for hearing on 2O.O1.2O24 and the matter was adjourned.

14. Therea_fter, the Applicant's representative by an e_mail dated

17.02.2024 informed the Tribunal claiming that the Applicant has never appointed any counsel to represent the Applicant nor the 13 Applicant had appointed Mr'Justice C'Praveen KumzLr (Retd') as nominee arbitrator. Thereafter, the arbitrators as w-el[ as presiding arbitrators withdren' from ofhce of arbitration and passed orders on o5.o3.2024arld06.o3.2024.Mr.JusticeC.PraveenKumzLr(Retd.)who was nominatc d as arbitrator try the Applicant had alsc recused from the arbitratior-r. As such the present application is infru,:tuous and is not maintainzrble. It is further submitted that once the Tribunal has come into force and held proceedings which were att':nded by the nominee of the Applicant and thereafter by the co nduct of the Applicant, thc arbitrators has recused and the remedv therefore lies under sectiorL 14 and 15 of the 1996 Act and without tht: appointment of Applicant's nominee arbitrator, they have lost the opportunity of appointing nominee arbitrator now. Therefore, the preserrt Applicant is not maintainable and there are no nominee arbitratorl; on behalf of the Applicanl - A rejoinder has also been filed by the Ap'plicant to the counter filed bY resPondent No.3.

15. Thc petitioner/Applicant has filed I.A No l of 2024 seeking to withdraw paragraph 13 of the af{idavit in A A'No'49 of 2024 wherein it is submitted that the disputes are onl'r' between the Applicant an<l respondent No.1 and that respondent Nos'2 and 3 are not necessarv parties to the application. It is further submilted that the disputes under Escrow Agreement dated 20.03.20110 are distinct I t4 b and different to other disputes between respondent No.3 and the petitioner/Applicarrt, especially the agreement dated 15.11.2O13. It is further submitted that at paragraph 13 of the affidavit, it has been inadvertentiy mentioned that both the agreements are intrinsically connected which as a matter of fact is incorrect and in order to avoid confusion, the petitioner/Applicant intended to withdraw paragraph 13 of the affidavit arrd also the deferral notice dated 13.12.2023 apart from being contrary to the Escrow Agreement daLed 20.O3.2O2O.

16. Respondent No.3 has hled counter affrdavit to the said application denying the allegations in to-lo and would submit that the dispute with regard to the closure of Escrow Agreement is not between the Applicant and respondent No.l but'between the Applicant and respondent No.3 and for the said purpose earlier the arbitral tribunal was constituted to adjudicate the disputes. However, the Tribunal t withdrew from its ofhce by an order dated O5.03.2024 and 06.03.2024 and the arbitrator nominated by the Applicant has recused from the ofhce of arbitration, as such, the application has become infructuous and that respondent No.3 did not give consent for closure of Escrow Account and respondent kept the account alive. It is further submitted that all the disputes between the Applicant and respondent No.3 are intrinsically interlinked as the facts and documents are common and submits that the same arbitral tribunal may be 15 l{vsK, J appointed by this Court as was appointed in A.A No'!l 15 of 2024 to adjudicate the disputes under the Escrow Agreement dated

20.o3.2020.

17. Mr.C.V.N4ohan Reddy, learned senior cotLnsel for the Applicant ',r,o u1d submit that Applicant and respondent No.3 entered into 3 Escror,.- Agreements for deposit of Rs. i 50,O0,0o,0()O/ - each into the said accounts, so as to be disbursed among the .\pplicant and respondent No.3 totalling to Rs.450,O0,00,0O0/- to be deposited pursuant to tl-re interim order passed by the High CotLrt of Delhi in I.A.No.15200 of 2079 in OMP (ENF)(COMM) No.10O of 2011. Admittedly, the Applicant along with the respondents had entered into one among the said three Escrow Agreements ltrr deposit of Rs. 15O,00,0C,,00O/ - uide Escrow Agreement dated 20.O3.2O2O. Learned senior counsel submits that after disbursa of the total amount, all the t.hree Escrow Agreements shall b': closed and accordingly, two Escrow Agreements were closed with written letters by the Applic ant and respondent No.3 on 19.06.2020 utd 25.06-2020 respectively. The Escrow Agent i.e., respondent No.1 dj.t[ not close the Escrow Account leading to the dispute between the {pplicant and respondent No.1. As such the dispute is only with res;pondent No.l and respondr:nt Nos.2 and 3 are formal parties. As per clause 12.2(a) of Escrow .A.greement, tJle Applicant addressed a notice dated I t6 O4.I2.2O23 and also a deferral notice dated 19.12.2023 specifically stating that the Applicant shail be proceeding with the settlement of dispute with respondent No. 1. While so, the Applicalt and Respondent No. I have consented for appointment of sole arbitrator. Even though, respondent No.3 had no role to pay, learned counsel for respondent No.3 agreed before this Court on OI.OZ .2024 for appointment of sole arbitrator. It is further submitted that Applicant and respondent No.1 who are actual parties to the dispute have consented for appointment of sole arbitrator on 19 .Og .2024. trventually, learned senior counsel for the Applicant pray this Court for appointment of sole arbitrator under Section 11(6) of the 1996 Act.

18. Learned counsel for responddnt No.3 would submit that respondent No.3 had never consented for appointment of sole arbitrator in the present appiication and would further submit that once the Tribunal had come into force and held the proceedings, which were duly attended by nominee of the Applicant and thereafter due to the conduct of the Applicant, the arbitrators has recused and the remedy therefore lies under Section 14 and 15 of the 1996 Act and without the appointment of Applicant's nominee arbitrator, theyohave lost the opportunity of appointing nominee arbitrator now. As such, the present Applicant is not maintainable and there are no nominee t] lwsx, J arbitrators orL behalf of the Applicant' Therefore, prayed [o dismiss the present aPPlit:ation

19. Lezrrned counsel for respondent No' 1 woulc submit that respondent No. I is not a disputing party and is only an Escrow Agent appointed by both the parties and as per clause 13(2) of the Escrow Agreement, r-tnless joint agreement is filed, responden - No' 1 cannot close the Escrou' account and as on date, the Escrow Account is made debit frozen, as such there is no pending disputes tvarranting the appointment of arbitrator.

20. On 21.08.2024 this Court directed the Regiritry to put-up the letter, if any fi1ed by the Applicant suggesting the narre of nominee arbitrator. Thereafter, on 19.09.2024, this Court ha s passed the following order: "Leanted senior counsel for the Applicant c''s utell as leanted- senior counsel for respondent Nos;'7 and 2/ Bonk haue concluded their arguments and repcnted No Objectron for appointment of the sole Arbitrator'"

21. Thereafter, the matter was called upon on Of '7O'2O24 and learned senior counsel for the Applicant has sought ime to hle an application nominating their arbitrator as per clause 12'2 of the Escrow Agrer:ment. Thereafter, the matter was adjournel' I I 18 l{vsK, J

22. Heard learned counsel for the respective parties and perused the record.

23. The present application is frled under Section 11(6) of the 1996 Act and the grievance of the Applicant is only against respondent No.1. The Escrow Agreement dated 20.03.2020 is entered among the Applicant and the respondents. Clause 12.2 stipulates the dispute resolution wherein it was agreed that the dispute shall be resolved in accordance with the 1996 Act. Clause 13 stipulates terms and termination. Clauses 13.2 and 13.3 are extracted hereunder for the purpose of reference: "13.2. This Agreement shall be terminated onlg , based on the submission of a uritten agreement bg atl ttre PARTIES portners to this effect to thi Escrota Agent.

13.3. Upon termination of this Agreement pursuant to clause 13.2 aboue, the Escrout Account shall stand closed and anA amount lging in the Escrout Account shall be released by the Escrou.t Agent o.s per clause 4 aboue unless contrary uritten instructions jointtg signed by alt JV partners is giuen.

13.4. NeitlLer of the JV and Rithtoik mag unilaterallg approach the Escrou_t Agent for ang modification of the prouisions of this Agreement or for its termination saue as othentLise p rouide d herein. "

24. In th-e letter issued by the applicant on 19.06.202O, it has been informed to the Bank that the purpose to receive and transfer as laid out in the Escrow Agreement is completed, and requested the Bank to do the needful, so that there are no furttrer transactions that are not contemplated in the Escrow Agreement. It is further requested 19 I!l/sx. J A.A.No.49 of 2024 to submit all transactions executed for the purpose of rcconciliation and records. Whcreas, in the present application, tt.e Applicant submits that the said letter was issued to formally clost the Escrow Account bearirLg No.44370O2900000827. However, on a per-usal of the letter dated 1t).06.2020, there is no specihc clirecliorr lo close the Escrorv Accounl. Similarly, in the letter issued by respondent No.3 to respondent No.1 on 25.06.2020, there was a specific in struction for the closure of tbe Escrow Account in the name of the Applicant and in the said letter. il w'as informed [hat since the purposxr of opening Escrow Accounl is fulfilled, it is requested to terminate the Escrow Agreement anrl arrangc to close the said account in compliance of clause 13.3 of [!scrov,' Agreement and subsections thereof.

25. CIarLse 113.3 stlpulatcs that upon termina-ion of this Agreement pursuant to clause 13.2 above, the Escrorv ,Account sha1l stand closed i.nd an1' amount lying in thc Escrolv Acc,tunt shall be released by th:r Escl-ou' Agent as per clause 4 above unJess contrary written instrucLions jointly signed by all partners is given. The Apolicant anci respondent No.3 has given different letters, however, the same is n,rt in tcrms of clause 13.2 and 13.3 of the Agreement dated 20.03.2[t20 zrnd as submitted by iearned counsel f,;r respondent No.1 tfrat unless the .Joint Agreement is given in terms o.. clauses 13.2 and 13.3, the.lccoLrnt cannot be closed. lt is pertinenL to rote that the 1 20 ,.'i. nlvsl<, J Presiding Arbitrator by an order dated 05.03.2 O24 d,id not wish to continue the matter and withdrew from the ofhce as presiding Arbitrator and passed order leaving it open to the parties to pursue the matter in accordance to law. Similarly, the sole arbitrator appointed also withdrew from the officc of arbitration with immediate effect and left it open to the parties to pursue the remedies in accordance with 1aw.

26. As on the date of rcserving the present Application for passing of ordcrs, no application, under Section 11(6) of thc 1996 Act has been hled by the Applicant norrinating their arbitrator. For the purpose of reference, Section i1(6) of the 1996 Act is extracted hereunder for facility: "6. Where, under an appointment procedure agreed upon bg ttte parties. lg) a partg faiLs to nct as required. under that procedure; or fu)the parties, or the tu_to appointed. arbitrators, fail to reach an agreement expected. of them under that procedure; or lp)a person, including an institution, fails to perform anA function entrasted to him or it und-er that procedttre,. [the appointment shall be ndd.e, on an application of the partA, bA the arbitro"l institution designated bg the Supreme Court, in cqse of 1 // 2l international commercial arbitration, or by firc High Courl, in case of arbitrations other than intertational commercial arbitration, as the case mag bel to lake the necessary measure, unless the agreement on the appoirrtmenl procedure prouides other means for secun,tg the o ppointment. t'54 The Supreme Court or, as the case nag be, the High Court, uhile considenrug any application under sub-sectton (4) or sub-section (5) or suL - sectiort (6), slrul|, nottuith,standing ang judgment, dpcree or order oJ' ang Court, confine to the examinatio t of the existence of an arbitration agreement. i6B) The designation of ang person or in;titution bg the Supreme Court or, as the case maA be, the High Court, for the purposes of this Section shail not be regard.ed as a delegation of judicial poLuer bg the Supreme Court or the High Court." \ t

27. Admittedly, the sole arbitrator arrd the presi,ling arbitrator has withdrawn from the arbitration proceedings and tre mandate of the arbitration js terminated in terms of Section 15 of the 1996 Act, and the Applicant did not nominate their arbitrator in te rms of Section 11(6) of the 1996 Act and as submitted by responden t No.l that the Escrow Acccunt is debit frozen and that no parties crtn operate the Account and that unless joint agreement is hled by Applicant and respondent No.3, respondent No. l/Bank cannot clos,e the Escrow account and as on date the Escrow Account is made d':bit freeze and 22 -,''.., ' no party can operate the said Account bearing No.4437OO290O00O827, as such there is no pending arbitra_l disputes warranting the appointment of arbitrator as per clause 12 of the Arbitration Agreement dated 20.03.2020. That apart in terms of Section I 5 ol- the I 996, Act t he mandate of Arbitiator terminated and requires appointment of a substitute arbitrator. The applicalt has hled the present application under Section 1l(6) of the 1996 Act initiating appointment of new Arbitrator when the mandate of the Arbitrator terminated.

28. In view of the observations made above, this Court is of the considered opinion that, there are no arbitral disputes with regard to Escrow Agreement dated 20.03.2020 and'the Escrow Account bearing No.4437OO29O000O827 is debit frozen, as such the present application is not maintainable. Accordingly, Arbitration Application No.49 of 2024 rs devoid of merits, fails and stands dismissed. As a sequel, miscellaneous applications, if any pending, shall stand closed. //TRUE COPY// SD/- B. SATYAVATHI JOINT REGISTRAR secrroK&rncen I To 1 2 One CC to Ms. NAFISA, Advocate [OPUC] One CC to Ms, KALPANA EKBOTE, Advocate [OPUC] Two CD CoPies ADK/gh HIGH GOURT DATED:0910612025 ORDER ARBAPPL.No.49 ot 2024 1HE SI{I ( t:. o() -L- 1ri JUL zffi z * :rFli'(-.ki: ;t: DISMISSING THE ARBAPPL 6 fl( 36