ORAL JUDGMENT
1. Heard Shri A.A. Naik, advocate for the applicant and Shri Sandip B. Tiwari advocate h/f Shri Rajnish R. Vyas advocate for the non-applicants 1 and 2. The service of notice on non-applicant no.3 is dispensed with.
2. Rule. Rule made returnable forthwith.
3. The applicant has approached this Court under Section 11(6)(c) of the Arbitration and Conciliation Act, 1996 praying that an Arbitrator be appointed to resolve the dispute between the applicant and the non-applicant no.1.
4. The contention of the applicant is that the dispute is required to be resolved by arbitration as per Clause (9) of the agreement dated 5 thNovember, 2011 by submitting the dispute for arbitration to the International Chamber of Commerce in India in accordance with the I.C.C. Arbitration Rules and the Arbitration and Conciliation Act, 1996. The learned advocate for the applicant has submitted that the applicant made attempts to settle the dispute amicably, however, as there was no response from the
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non-applicant no.1, the applicant sent communication dated 7 thOctober, 2013 to the Executive Officer, International Chamber of Commerce in India, New Delhi requesting for appointing an Arbitrator at Nagpur, to resolve the dispute. It is submitted that the International Chamber of Commerce in India, New Delhi has neither given reply to the communication nor any action is taken in the matter and, therefore, the applicant is constrained to approach this Court. The International Chamber of Commerce in India is impleaded as non-applicant no.3 in these proceedings. The learned advocate for the applicant has pointed out the communication sent by the Research Associate of International Chamber of Commerce, New Delhi, in response to the notice issued by this Court stating that the International Chamber of Commerce in India does not have locus standi to appoint Arbitrator in the arbitration cases pertaining to I.C.C. International Court of Arbitration. Relying on the above mentioned communication, the learned advocate for the applicant has submitted that the International Chamber of Commerce has failed to appoint the Arbitrator and, therefore, this Court is required to exercise its Authority under Section11(6) of the Arbitration and Conciliation Act, 1996 and appoint an Arbitrator to resolve the dispute.
5. Shri Tiwari, learned advocate for the non-applicants 1 and 2 has submitted that the applicant has not made proper application to the appropriate office of International Chamber of Commerce as per I.C.C. Arbitration Rules, requesting for appointment of
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an Arbitrator. The learned advocate has pointed Article 4(1) of the I.C.C. Arbitration Rules which reads as follows :
"Article 4 Request for Arbitration.
1 A party wishing to have recourse to arbitration under the Rules shall submit its Request for Arbitration (the "Request") to the Secretariat at any of the offices specified in the internal Rules. The Secretariat shall notify the claimant and respondent of the receipt of the Request and the date of such receipt"
Relying on Article 4(1) of Appendix I of the I.C.C. Arbitration Rules it is submitted that the International Court of Arbitration of the International Chamber of Commerce is an Autonomous Body ensuring the application of the Rules of Arbitration of International Chamber of Commerce. It is submitted that the International Court of Arbitration of the International Chamber of Commerce has all the necessary powers for that purpose. Referring to Article 1(3) of Appendix I of the I.C.C. Arbitration Rules it is submitted that the Members of the International Court of Arbitration of International Chamber of Commerce are independent from the I.C.C. National Committees and Groups. Referring to the Literature of International Chamber of Commerce, it is pointed out that I.C.C. India is the National Committee of International Chamber of Commerce, which is not concerned with the request for arbitration and the request for arbitration has to be submitted to any of the offices specified by the I.C.C. international Rules as stated in Article 4(1) of the Appendix 1 of the I.C.C. Arbitration Rules. It is
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submitted that as per the details available on the website of International Chamber of Commerce, the request for arbitration has to be submitted by post, courier, or hand delivery or by email or facsimile provided that the requisite number of hard copies are sent by post, courier or hand delivery. It is submitted that the request for arbitration has to be made to any of the three Secretariats situated at Paris, Hong Kong or New York and in the present case the request for arbitration has to be submitted to the Secretariat of the I.C.C. International Court of Arbitration - Asia office at Hong Kong. Shri Tiwari, learned advocate has submitted that the applicant has not made request for appointment of Arbitrator as required and, therefore, the application filed by the applicant should not be entertained as it is premature.
6. The learned advocate for the applicant has submitted that the application for appointment of an Arbitrator is required to be submitted to the International Chamber of Commerce in India as per Clause (9) of the agreement between the parties and the communication was rightly sent to the Executive Officer of International Chamber of Commerce in India, New Delhi and as it has not taken any steps in the matter, this Court will have to consider the request of the applicant for appointment of an Arbitrator to resolve the dispute. In support of the submission, the learned advocate has relied on the judgment given in the case of M/s. Delta Mechcons (India) Ltd. V/s. M/s. Marubeni Corporation reported in 2007 AIR SCW 3610.
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7. Clause (9) of the agreement between the parties reads as follows :
"9. ARBITRATION All disputes in connection with this contract or the execution thereof shall be settled by friendly negotiation between two parties. If no settlement can be reached, the case in dispute shall then be submitted for arbitration to the International Chamber of Commerce in India and in accordance with the Rules and the Arbitration Act 1996. The arbitration shall take place in Nagpur. The decision made by the commission shall be accepted as final and binding upon both the parties. The arbitration expenses shall be borne by the two parties."
It is clear from the above clause that at the time of agreement the parties intended that in case of any dispute attempt to settle by friendly negotiations should be made and if such attempt failed, the dispute should be submitted for arbitration. The parties agreed that the arbitration has to be undertaken by an Arbitrator appointed by the International Chamber of Commerce. However, while reducing the intention of the parties into agreement, it came to be recorded that the arbitration will be by an Arbitrator appointed by International Chamber of Commerce in India overlooking that the request for appointment of an Arbitrator has to be made to the Secretariat of the International Chamber of Commerce situated at Hong Kong. The intention of the parties to get the dispute resolved by an Arbitrator appointed by the International Chamber of Commerce is clear, therefore, the applicant will have to submit its request for arbitration to the Secretariat of the I.C.C. International Court of Arbitration - Asia
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Office at Hong Kong. In view of the above, it has to be held that the application filed by the applicant under Section 11(6)(c) of the Arbitration and Conciliation Act, 1996 is premature and the prayer made by the applicant cannot be considered at this stage. In the case of M/s. Delta Mechcons (India) Ltd. V/s. M/s. Marubeni Corporation (cited supra) , as per the agreement between the parties the dispute was required to be resolved by Arbitral Tribunal consisting of three Arbitrators out of which one Arbitrator was to be appointed by the Contractor, one Arbitrator was to be appointed by the Sub-Contractor and the third Arbitrator (Chairman) was to be appointed by the Arbitrators appointed by the Contractor and the Sub-Contractor. The Contractor and Sub-Contractor appointed two Arbitrators, however, the two Arbitrators could not nominate the third Arbitrator (Chairman) and in these facts, the party approached the International Chamber of Commerce for appointment of the third Arbitrator (Chairman). The International Chamber of Commerce refused to appoint the third Arbitrator (Chairman) in the matter and in the facts of that case, it was held that the request for appointment of an Arbitrator under Section 11(6) of the Arbitration and Conciliation Act, 1996 can be considered.
In the present case, the request to appoint an Arbitrator has not been made to the appropriate Authority and, therefore, the application filed by the applicant under Section 11(6)(c) of the Arbitration and Conciliation Act, 1996 is premature.
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8. Hence, the following order :
(i) The application filed by the applicant under Section 11(6)(c) of the Arbitration and Conciliation Act, 1996 is dismissed as premature.
(ii) The applicant is at liberty to make proper request to the International Chamber of Commerce as per the I.C.C. Arbitration Rules.
In the circumstances, the parties to bear their own costs.
JUDGE
Tambaskar.
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