✦ High Court of India · 09 Jun 2025

High Court · 2025

Case Details High Court of India · 09 Jun 2025

Court

High Court of India

Decided

09 Jun 2025

Bench

Not available

Length

1,581 words

Acts & Sections

Any arbitral institution designated under the provisions of the Arbitration and Conciliation Act 1996 Arbitration Act §11 Arbitration Act §21 Arbitration Act Arbitration and Conciliation Act 1996 The Arbitrator shall conduct the arbitration in accordance with the provisions of the Arbitration and Conciliation Act 1996

Arb. O.P.(Com. Div.) No.134 of 2025IN THE HIGH COURT OF JUDICATURE AT MADRASDATED : 09.06.2025CORAMTHE HON'BLE MR. JUSTICE ABDUL QUDDHOSEArb. O.P.(Com. Div.) No.134 of 2025FIVE STAR BUSINESS FINANCE LIMITED... PetitionerVs.1. GUDDI KUNWAR DODIYA2. PRAHLAD SINGH DODIYA3. RAGHVENDRA SINGH... RespondentsPRAYER: Petition filed under Section 11 of the Arbitration and Conciliation Act, 1996 to appoint a sole arbitrator to adjudicate the dispute between the petitioner and the respondents arising out of the loan agreement dated 17.07.2023 and to direct the respondents to pay the cost.For Petitioner:Ms. Vinodhini Mathelenefor Mr. P.H. Vinodh PandianFor Respondents:Set ex-parteORDERAs directed by this Court, the Registry has printed the name of the respondents in the cause list today. Through substituted service, the 1/12 https://www.mhc.tn.gov.in/judis Arb. O.P.(Com. Div.) No.134 of 2025respondents have been served with the notice in this petition. Despite effecting substituted service, the respondents have chosen not to enter appearance in this petition. Hence, the respondents are set ex-parte by this Court. 2. This petition has been filed under Section 11 of the Arbitration and Conciliation Act, 1996 seeking for appointment of an arbitrator. 3. There seems to be a dispute between the petitioner and the respondents arising out of the Loan Agreement as well as the Memorandum of Deposit of title deeds, both dated 17.07.2023. There exists an arbitration clause in both the aforementioned contracts, which is extracted hereunder:"ARTICLE 10: ARBITRATIONGOVERNING LAW, DISPUTE RESOLUTION AND JURISIDICTION: (Art 10 existing agreement)1. This Agreement shall be governed by and construed in accordance with the laws of India.2. Any and all dispute(s), difference(s) and /or claim(s) arising out or touching upon this Agreement or in 2/12 https://www.mhc.tn.gov.in/judis Arb. O.P.(Com. Div.) No.134 of 2025relating to this Agreement, whether during its subsistence or thereafter, shall be referred to the Arbitration by a Sole Arbitrator to be appointed by any one of the below mentioned 'arbitral institution' in accordance with the provisions of the Arbitration and Conciliation Act, 1996 or any statutory amendments thereof from time to time.a. Council for National and International Commercial Arbitration (CNICA) currently having its office at Unit No. 208, 2 Floor, Bela Wing, Raheja Towers, Nos 113-134, Anna Salai, Chennai-600002, orb. Southem India Chamber of Commerce and Industry (SICCI), currently having is Office at Indian Chamber Buildings, P.B.No 1208, Esplanade, Chennai-600108, or c. Kovise Foundation Conflict Resolution International (KRCRI), currently having its Office at G-2, Plot No. 108, Majestic Colony, Valasarawakkam, Chennai-600087, or3/12 https://www.mhc.tn.gov.in/judis Arb. O.P.(Com. Div.) No.134 of 2025d. Any arbitral institution designated under the provisions of the Arbitration and Conciliation Act, 1996 (the act) or any panel of arbitrators maintained under the provisions of the act.The entire arbitral proceedings shall be conducted by the Arbitrator in the manner he/she considers appropriate, and the award rendered by the Arbitrator shall be final and binding on all the parties to this agreement. The arbitral institution shall provide administrative assistance to the Arbitrator to facilitate the conduct of the arbitral proceedings, if he/she chooses to avail such assistance from the institution.3. The Arbitrator shall be entitled to, at his/her discretion conduct the proceeding in-person and/or through exchange of mail, email and/or any other mode of electronic communication including video conferencing (VC), online, virtual hearing etc., using an external application or platform, if necessary. The parties to the arbitration proceeding shall be bound by 4/12 https://www.mhc.tn.gov.in/judis Arb. O.P.(Com. Div.) No.134 of 2025the decision of the arbitrator in this regard. 4. The parties hereby consent to have the arbitral proceeding conducted by a written pleading, documents, written submissions and or any other electronic mode of communication-based arbitration as may be determined by the arbitrator.5. The parties herein agree not to insist on in-person and/or oral hearing except in certain exceptional circumstances as the Arbitrator may deem fit.6. The Parties herein agree that the venue and seat of the arbitration proceeding shall be usually at Chennai or in exceptional circumstances any other place as deemed fit by the Arbitrator.7. The language of arbitral proceedings shall be English.8. The parties herein agree that in the event of death of the Arbitrator to whom the matter has been originally referred or the Arbitrator being unable or unwilling to act as arbitrator for any reason whatsoever, the 5/12 https://www.mhc.tn.gov.in/judis Arb. O.P.(Com. Div.) No.134 of 2025arbitral institution shall substitute another person as may deem fit to act as Arbitrator, who shall proceed with the reference from the stage, at which it was left by his /her predecessor. 9. The Arbitrator so appointed shall have the power to pass an award on the secured assets or any other security or interest credited between the parties and and also to pass interim orders/ directions as may be appropriate to protect the interest of the parties pending adjudication of the claim and/or resolution of the disputes.10. Parties also consent to the following:a. to send a copy of the award through post/courier or a scanned image or such an award to the parties through mail/email or any other electronic mode through such institution which shall be considered as signed copy for the purposes of the Act .b. if the award is not made or could not be made within 12 months from the date of completion of 6/12 https://www.mhc.tn.gov.in/judis Arb. O.P.(Com. Div.) No.134 of 2025pleadings by the arbitrator, for any reason whatsoever, the parties hereby consent for an extension of time for another six months.11. In respect of the arbitral proceeding, all notices, processes and communications in that regard to all the parties shall be through post/courier and/ or mail/email and/or any other electronic modes of communication, as may be determined by the arbitrator and if resorted to, shall be a valid service of notices, processes and communications on the parties. Any notice, processes and communications issued to the counsel or representative representing the parties to the arbitration proceeding shall be deemed and valid service on the parties.12. The post/courier and/or mail/email and/or any other electronic mode of address provided by the Borrower(s) /Guarantor(s) to the lender under the agreement or any other document executed by the Borrower(s)/ Guarantor(s) with the lender/company 7/12 https://www.mhc.tn.gov.in/judis Arb. O.P.(Com. Div.) No.134 of 2025shall be deemed to be an active postal/mail/email and/or any other electronic mode of address and any service effectuated upon such postal/mail/email and/or any other electronic mode of address shall be deemed to be completed. Any change or other discrepancies in the postal/mail/email and/or any other electronic mode of address provided above, shall be informed to the lender/ company promptly.13. All communications shall be considered to have been received by the parties within seven days from the time of sending the communication. In case, if after expiry of seven days from the date of communication, there lies no response from the parties, it shall be the discretion of the Arbitrator to proceed with the arbitration proceeding and/or render the award as the case may be in their absence.14. It shall be the responsibility of the parties to maintain sufficient space in the email account and/or in any other mode of electronic account(s) and also to 8/12 https://www.mhc.tn.gov.in/judis Arb. O.P.(Com. Div.) No.134 of 2025have supporting applications/software in their computer/mobile/any other electronic device or accessories and infrastructure required to access the electronic documents sent to them and also to enable the arbitrator to conduct the arbitration proceeding through VC, online virtual hearing etc.,15. Unless otherwise directed by the Arbitrator, the existence or subsistence of a dispute or the commencement of arbitral proceeding under this clause shall not in any manner prevent or postpone the performance of any obligations of any party which do not form part of the dispute."4. The petitioner has invoked arbitration in accordance with the arbitration clause by issuing notice under Section 21 of the Arbitration and Conciliation Act, 1996, to the respondents on 04.12.2024. According to the petitioner, despite service of notice, the respondents have chosen not to reply to the arbitration invocation notice. 9/12 https://www.mhc.tn.gov.in/judis Arb. O.P.(Com. Div.) No.134 of 20255. Since there is no consensus between the parties with regard to the name of the Arbitrator, this petition has been filed under Section 11 of the Arbitration and Conciliation Act, 1996 seeking for appointment of an Arbitrator. Since there exists an arbitration clause in the subject matter of the contracts and since the petitioner has complied with the requirements of Section 21 of the Arbitration and Conciliation Act, 1996 by issuing notice to the respondents on 04.12.2024, this Court has to necessarily appoint an arbitrator under Section 11 of the Arbitration and Conciliation Act, 1996.6. Accordingly, this Arbitration Original Petition is allowed as prayed for by issuing the following directions: (a) Mr.Advaidh Nelakanthan, Advocate, who is having office at No.36, 1st Floor, Kaaveri Villa, Indira Nagar, Adyar, Chennai - 600 020 (Mobile No.99620 23322) is appointed as the sole Arbitrator to decide the dispute between the petitioner and the respondents arising out of the loan agreement dated 17.07.2023;(b) The Arbitrator shall be paid his remuneration / fees in accordance with the 4th schedule of the Arbitration and Conciliation Act, 1996 or as per the mutual consent of both the parties;10/12 https://www.mhc.tn.gov.in/judis Arb. O.P.(Com. Div.) No.134 of 2025(c) Both the parties shall equally share the arbitrator's fees;(d) The Arbitrator shall conduct the arbitration in accordance with the provisions of the Arbitration and Conciliation Act, 1996 and shall complete the arbitration within the specified time as prescribed under the said Act.09.06.2025Index: Yes/NoSpeaking Order : Yes / NoNeutral Citation Case: Yes / Noab11/12 https://www.mhc.tn.gov.in/judis Arb. O.P.(Com. Div.) No.134 of 2025 ABDUL QUDDHOSE. J., abArb. O.P.(Com. Div.) No.134 of 202509.06.202512/12

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