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M/s. Contec Airflow (I) Private Limited v/s M/s. Rajasthan Drugs

    Arbitration Application No. 6 of 2016

    Decided On, 02 February 2018

    At, High Court of Rajasthan Jaipur Bench

    By, THE HONOURABLE MR. JUSTICE MOHAMMAD RAFIQ

    For the Appellant: P.C. Dewanda, Advocate. For the Respondent: N.L. Agrawal, Advocate.



Judgment Text

1. This application under Section 11(6) of the Arbitration and Conciliation Act, 1996, has been filed by petitioner M/s Contec Airflow (I) Private Limited praying for appointment of Arbitral Tribunal as per Section 10 and 11 of the Arbitration and Conciliation Act, 1996 for resolving the dispute between the petitioner and the respondent M/s. Rajasthan Drugs and Pharmaceuticals Limited.

2. The petitioner is a Private Limited Company registered under the Companies Act, 1956. The respondent, issued a letter of intent dated 01.11.2016 in favour of petitioner for ventilation and air conditioning work at their site. The cost of the said work was estimated to be Rs. 2,55,00,000/-. Pursuant to the said letter of intent, an agreement was entered into between the parties. The respondent pursuant to the said letter of intent had agreed to issue detailed purchase order for Schedule-A item and work order for Schedule-B item specified in the Bill of Quantity of the Tender Document No. T-003. The respondent thereafter issued purchase order no. 998 dated 14.12.2006-23.12.2006 in favour of the petitioner thereby giving the details of the purchase order and also issued work order for the work/erection and commissioning work to be done for the said ventilation and air condition system. The petitioner deposited a sum of Rs. 12,00,000/- (Rs. 3,00,000/- +Rs. 3,50,000/- + Rs. 5,50,000/-) as earnest money for execution of the said project.

3. Mr. P.C. Dewanda, learned counsel for the petitioner argued that the petitioner supplied the goods as per the purchase orders of the respondent and also carried out the work as per the work order and accordingly issued invoices to the respondent. The respondent, on several occasions, called upon the petitioner to do some additional and alternations in the work done by the petitioner and the petitioner accordingly complied with all the requirements. The petitioner requested orally as well as in writing several times to the respondent for releasing the payment for the goods supplied as per the purchase order and for the work done as per the work order, but the respondent failed and neglected to make payment. The officers of the respondent time and again assured the petitioner that the payment shall be released but so far nothing has been done. In this regard, minutes of the meeting dated 18.12.2012 is placed on the record as to the quantum of the work done. A total sum of Rs. 1,00,75,558/- (Rs. 92,25,558/- +Rs. 12,00,000/-) was due and payable by the respondent to the petitioner.

4. Mr. P.C. Dewanda, learned counsel for petitioner, has referred to Clause 28 of the Agreement between the parties and argued that the aforesaid clause, which is captioned "Settlement Of Dispute (Arbitration)" provides for resolution of the disputes between the parties through arbitration. This is an arbitration clause and that the reference ought to be made to Arbitrator/Arbitral Tribunal after making its appointment. Despite existence of dispute and invocation of arbitration clause by the petitioner, the respondent has failed to appoint the arbitrator in accordance with agreed procedure. It has therefore forfeited the right to do so. Learned counsel, in support of his arguments, has relied on the judgments of the Supreme Court in Powertech World Wide Limited v. Delvin International General Trading LLC - (2012) 1 SCC 361, Visa International Limited v. Continental Resources (USA) Limited - (2009) 2 SCC 55, Mallikarjun v. Gulabarga University - (2004) 1 SCC 372, M/s. Duro Felguera, S.A. v. M/s. Gangavaram Port Limited - Arbitration Petition No. 30/2016 decided vide judgment dated 10.10.2017, and that of a Division Bench of this Court in M/s. Suri Constructions v. State of Rajasthan & Others - 2005 (4) WLC (Raj.) 563.

5. Mr. N.L. Agrawal, learned counsel for the respondent, opposed the application and argued that as per Section 21 and 43 of the Arbitration and Conciliation Act, 1996, the legal notice for referring the dispute as per the arbitration clause in the agreement between the parties is required to be issued and the same must have been received by the opposite party within a period of limitation prescribed under the Limitation Act, 1963. The period of limitation is same as prescribed in the proceedings in a court of law for filing civil suit i.e. three years from the date of accrual of the cause of action. In the present case, such notice for referring the dispute for arbitration has been served upon the petitioner. Learned counsel for the respondent, in particular, argued that Clause 28 of the Agreement between the parties cannot be, on its plain reading, described as arbitration clause as the first part of this clause is subject to second part that in case either party fails to accept the award of the arbitrator, the other party may refer the matter to the court of law having jurisdiction at Jaipur only. Reliance is placed on the judgment of the Supreme Court in Jagdish Chander v. Ramesh Chander & Others - (2007) 5 SCC 719 and that of this Court in M/s. Mohammed Arif Contractor v. State of Rajasthan and Another - 2015 (4) WLC (Raj.) 32.

6. Having heard learned counsel for the parties and perused the material on record and cited judgments, I find that the word "Arbitration" has been mentioned in the bracket portion immediately after the caption of Clause 28 of the Agreement, i.e. "Settlement of Dispute". The language of Clause 28 of the Agreement would apparently show that the Managing Director (RDPL) has been made as an Arbitrator and was required to render his decision/award, whose decision/award shall be binding on both the parties. But then, this is subject to a further rider that in case either party fails to accept the award of the arbitrator, the other party may refer the matter to the court of law having jurisdiction at Jaipur only. Two parts of Clause 28, supra, are somewhat identical to Clauses 23 and 51 of the format of the contract agreement between the Contractors and various Works Departments of the State of Rajasthan viz., Public Works Department, Irrigation Department, Public Health and Engineering Department etc. In order therefore to appreciate whether Clause 28 is an arbitration clause or not, it is deemed appropriate to reproduce Clause 28 of the agreement in the present case and also Clauses 23 and 51, supra, in extenso:-

"28. Settlement Of Dispute (Arbitration)

All disputes and differences of any kind whatever arising out of or in connection with the contract or the carrying out of the works, whether during the progress of the works or after their completion and whether before or after the determination or breach of the contract, shall be referred to Arbitration. Managing Director (RDPL) shall be the sole Arbitrator & his decision/award shall be binding on both the parties.

In case either party fails to accept the award of the arbitrator the other party may refer the matter to the court of law having jurisdiction at Jaipur only.

Clause 23: Standing Committee for Settlement of disputes :-

If any question, difference of objection, whatsoever shall arise in any way, in connection with of arising out of this instrument of the meaning of operation of any part thereof, of the right duties or liabilities of either part then, save in so far, as the decision of any such matter, as herein before provided has been otherwise provided for and whether it has been finally decided accordingly, or whether the contract should be terminated, or has been rightly terminated and as regards the rights or obligations of the parties as the result of such termination, shall be referred for decision to the empowered Standing Committee, which would consist of the followings:-

(i) Administrative Secretary concerned.

(ii) Finance Secretary or his nominee, below the rank of Deputy Secretary and/or Chief Accounts officer.

(iii) Law Secretary or his nominee, below the rank of Joint Legal Remembrancer.

(iv) Chief Engineer-cum-Addl.Secretary of the concerned department.

(v) Chief Engineer concerned (Member-Secretary).

The Engineer-in-charge on receipt of application along with non refundable prescribed fee, (the fee would be two percent of the amount in dispute, exceeding Rs. One lac) from the contractor shall refer the disputes to the committee within a period of one month from date of receipt of application."

"Clause 51: Jurisdiction of Court:

In the event of any dispute arising between the parties thereto, in respect or any of the matters comprised in this agreement, the same shall be settled by a competent court having jurisdiction over the place, where agreement is executed and by no other court after completion of proceedings under Clause 23 of this contract."

7. Although, initially a Division Bench of this Court in M/s. Suri Constructions v. State of Rajasthan & Others - 2005 (4) WLC (Raj.) 563, held the aforesaid Clause 23 to be an arbitration clause but subsequently another Division Bench of this Court in State of Rajasthan and Another v. SPML INFRA Ltd. & Another - 2015 (4) WLC (Raj.) 375, held otherwise, that the aforesaid Clause 23 is an arbitration clause. A Single Bench of this Court in M/s. Mohammed Arif Contractor, supra, the judgment relied by the learned counsel for the petitioner, following the judgment in State of Rajasthan and Others v. SPML INFRA Limited and Another, supra, also held Clause 23, supra, to be an arbitration clause. Aforesaid distinction has been noticed by Co-ordinate Bench of this Court in M/s. Mohammed Arif Contractor (supra) which noted that decision of later Division Bench of this Court in State of Rajasthan & Ors. v. SPML INFRA Ltd. & Anr. (supra), which is founded on principle of law laid down by the Supreme Court in Bhagyadhar Dash (supra) has to be preferred. The Coordinate Bench of this Court in para 17 of the judgment held as under:

"17. If the aforestated principles/guidelines are applied to the facts of the present case, it appears that the Standing Committee for settlement of disputes as mentioned in the said clause 23 consist of the members, who are the concerned Secretaries and the Engineers of the concerned department of the government, and therefore such committee could be termed to be a private tribunal by any stretch of imagination. There is nothing in the said clause 23 to suggest that both the parties to the contract had any intention to be bound by the decision of the said Committee. On the contrary, Clause 51 of the said agreement states that in the event of any differences arising between the parties in respect of any matters comprised in the agreement, the same shall be settled by the competent Court having jurisdiction over the place, where the agreement is executed and by no other Court, after completion of proceedings under Clause 23 of the contract. From the bare perusal of the said clause 51, it clearly transpires that it was kept open for both the parties to approach the competent court having jurisdiction for settling the disputes, after the completion of proceedings under Clause 23 of the agreement in question. The non adjudicatory decision of the empowered committee under Clause 23, was made subject to the right of the parties to seek remedy as per Clause 51. Therefore such Clause 23 could be termed as the arbitration Clause, as held by the Apex Court in case of P. Dasaratharama Reddy Complex (supra)."

8. Subsequently, I had the occasion to deal with this very question in Singhal Construction Company v. Rajasthan State Agriculture Marketing Board through Administrator Rajasthan State Agriculture Marketing Board - 2017 (2) WLC (Raj.) 752, where learned counsel for the applicant argued that the Division Bench of this Court in State of Rajasthan & Others v. SPML INFRA Ltd. & Anr., supra, has noticed binding decision of another Division Bench in M/s. Suri Constructions v. State of Rajasthan & Others, supra, and therefore was per in-curium. It was therefore that this court again examined the said question. Many of the judgments, which the learned counsel has now cited, were considered and it was held as under:-

"In view of parameters of law laid down by the Supreme Court in umpteen of decisions, it would be clear that Clause 23 of the agreement cannot be held to be an arbitration clause as such clause provides for empowered standing committee consisting of Additional Chief Engineer, Secretaries of the concerned department, which cannot be described as a private tribunal of arbitrators. Aforesaid clause does contain any stipulation that the empowered standing committee would be required to give opportunity to the parties to give their evidence and render its decision after hearing them. No procedure has been prescribed as to and in what manner said Committee shall conduct its proceedings. Binding nature of the decision of the standing empowered committee is expressly doubtful, as Clause 51 of the agreement provides that in the event of any dispute arising between the parties here to in respect of any of the matters comprised in this agreement, the same shall be settled by a competent court having jurisdiction over the place where agreement is executed and by no other court. Therefore, decision of the empowered standing committee cannot be termed as a judicial decision. Even from the perspective of Section 12(5) read with entry first and fifth of Schedule Fifth and Seventh of Arbitration and Conciliation (Amendment) Act, 2015 (for short 'the Amendment Act of 2015'), it is found that since the empowered standing committee consists of Secretaries and Engineers of the concerned department, it cannot be considered as arbitral tribunal because the Parliament by the aforesaid amendments has emphasised for appointment of an independent and impartial arbitrator."

9. The Supreme Court has also recently in Rajasthan State Road Transport Corporation and Others v. M/s S.B. Construction - Civil Appeal No.7947/2009, decided vide order dated 10.08.2017, held the aforesaid Clause 23 to be an arbitration clause when it set aside an order passed by this Court passed under Section 11(6) of the Arbitration and Conciliation Act, 1996, appointing the sole Arbitrator to settle the dispute. Para 2 to 4 of the order dated 10.08.2017 of the Supreme Court read thus:-

"2. The High Court, while disposing of an application filed by the respondent under Section 11(6) of the Arbitration and Conciliation Act, 1996, appointed a retired Judge as the sole arbitrator to settle the dispute between the parties.

3. Having examined Clause 23, extracted hereinabove, we are of the view, that there was no arbitration agreement between the parties, and as such, the High Court could have appointed an arbitrator in the matter.

4. In view of the above, we hereby set aside the impugned order dated 4.5.2007, leaving it open to the respondent to seek its remedy before a Court of competent jurisdiction, if it is so advised, in accordance with law."

10. There is a substantial similarity between Clause 23 read with Clause 51, supra, and Clause 28 of the Agreement between the parties in the present case, because except the use of arbitration in the bracket portion along-with the caption of Clause 28, the main clause does have the trappings of arbitration clause. Clause 28 of the agreement provides that all disputes and differences whether during the progress of the works or after their completion and whether before or after the determination or breach of the contract, shall be referred to Arbitration. Managing Director (RDPL) shall be the sole Arbitrator and his decision/award shall be binding on both the parties. If only this much would have been stated in Clause 28, it could perhaps constitute an arbitration clause. However, it has been subjected to a rider given in sub-para to main Clause 28 that "in case either party fails to accept the award of the arbitrator the other party may refer the matter to the court of law having jurisdiction at Jaipur only." Even though the main Clause 28 makes the decision/award of the Managing Director binding on both the parties, but its enforceability has somewhat been diluted when the rider clause says that if either party fails to accept the award of the arbitrator, the other party may refer the matter to the court of law. In other words, the aggrieved party shall have to approach the court of law for rederessal of grievance for proper relief. Thus, it cannot be said that this Clause merely confers the right on the parties to file objection against the award i.e. under Section 34 of the Arbitration and Conciliation Act, 1996. Beside, the objections are required to be filed by the party, who is satisfied with the award or is aggrieved by the award and by the one in whose favour award has been passed. Here the party, who has been advised to approach the court of law having jurisdiction at Jaipur is also the one in whose favour the Managing Director has given its decision but other party has failed to accept his award. Thus, if in a given case, a party to the arbitration declines to accept the award, the other party is left with no option except to avail the remedy of approaching the court of law, which could be only by means of a civil suit for enforcement of the decision of the Managing Director or otherwise. Moreover, there may also be a situation where the award passed by the Arbitrator in the scheme of Clause 28, supra, may be partly in favour of one party and partly against another one and if the party, in whose favour part award has been passed, is satisfied therewith, remedy to file objection under Section 34 with regard to part of award may be an efficacious remedy in view of dilution of the enforceability of the part of award to the extent it is favourable to him because the other party, against whom the part of the award has been passed, may even implement it. To that extent, even then the party in whose favour part award has been passed, would then the compulsion of approaching the court of law for its enforcement. In either case, this Clause makes the remedy of objection available under Section 34 redundant leaving parties to the mercy of the court for seeking the desired relief. Latter part of Clause 28 therefore brings about a situation somewhat analogous of Clause 51 in the aforementioned judgment in M/s. Mohammed Arif Contractor, supra, which provides that in the event of any dispute arising between the parties, in respect or any of the matters comprised in the agreement, the same shall be settled by a competent court having jurisdiction over the place, where agreement is executed.

11. In Jagdish Chander v. Ramesh Chander & Others, (2007) 5 SCC 719, the Supreme Court held that it was permissible for Chief Justice or his designate to appoint an arbitrator to adjudicate the dispute between the parties in the absence of an arbitration agreement or mutual consent. The principles as to in what situation arbitrator should be appointed culled out in that judgment are as follows:

"(i) The intention of the parties to enter into an arbitration agreement shall have to be gathered from the terms of the agreement. If the terms of the agreement clearly indicate an intention on the part of the parties to the agreement to refer their disputes to a private tribunal for adjudication and an willingness to be bound by the decision of such tribunal on such disputes, it is arbitration agreement. While there is no specific form of an arbitration agreement, the words used should disclose a determination and obligation to go to arbitration and merely contemplate the possibility of going for arbitration. Where there is merely a possibility of the parties agreeing to arbitration in future, as contrasted from an obligation to refer disputes to arbitration, there is no valid and binding arbitration agreement.

(ii) Even if the words 'arbitration' and 'arbitral tribunal (or arbitrator)' are used with reference to the process of settlement or with reference to the private tribunal which has to adjudicate upon the disputes, in a clause relating to settlement of disputes, it does detract from the clause being an arbitration agreement if it has the attributes or elements of an arbitration agreement. They are : (a) The agreement should be in writing. (b) The parties should have agreed to refer any disputes (present or future) between them to the decision of a private tribunal. (c) The private tribunal should be empowered to adjudicate upon the disputes in an impartial manner, giving due opportunity to the parties to put forth their case before it. (d) The parties should have agreed that the decision of the Private Tribunal in respect of the disputes will be binding on them.

(iii) Where the clause provides that in the event of disputes arising between the parties, the disputes shall be referred to Arbitration, it is an arbitration agreement. Where there is a specific and direct expression of intent to have the disputes settled by arbitration, it is necessary to set out the attributes of an arbitration agreement to make it an arbitration agreement. But where the clause relating to settlement of disputes, contains words which specifically excludes any of the attributes of an arbitration agreement or contains anything that detracts from an arbitration agreement, it will be an arbitration agreement. For example, where an agreement requires or permits an authority to decide a claim or dispute without hearing, or requires the authority to act in the interests of only one of the parties, or provides that the decision of the Authority will be final and binding on the parties, or that if either party is satisfied with the decision of the Authority, he may file a civil suit seeking relief, it cannot be termed as an arbitration agreement.

(iv) But mere use of the word 'arbitration' or 'arbitrator' in a clause will make it an arbitration agreement, if it requires or contemplates a further or fresh consent of the parties for reference to arbitration. For example, use of words such as "parties can, if they so desire, refer their disputes to arbitration" or "in the event of any dispute, the parties may also agree to refer the same to arbitration" or "if any disputes arise between the parties, they should consider settlement by arbitration" in a clause relating to settlement of disputes, indicate that the clause is intended to be an arbitration agreement. Similarly, a clause which states that "if the parties so decide, the disputes shall be referred to arbitration" or "any disputes between parties, if they so agree, shall be referred to arbitration" is an arbitration agreement. Such clauses merely indicate a desire or hope to have the disputes settled by arbitration, or a tentative arrangement to explore arbitration as a mode of settlement if and when a dispute arises. Such clauses require the parties to arrive at a further agreement to go to arbitration, as and when the disputes arise. Any agreement or clause in an agreement requiring or contemplating a further consent or consensus before a reference to arbitration, is an arbitration agreement, but an agreement to enter into an arbitration agreement in future."

12. The Supreme Court in J. Kodanda Rami Reddy v. State of Andhra Pradesh & Others, (2011) 1 SCC 197 was dealing with a case where order appointing arbitrator was challenged by the Government, even though para 2 of GOM dated 24.10.1983 provided that all claims above Rs. 50,000/- shall be laid before the Court of competent jurisdiction. Total 14 claims were raised by the appellant worth of which was more than Rs. 50,000/-, even then the Government did challenge the order passed by the civil court appointing arbitrator under Section 8(2) of the Arbitration Act, 1940. The arbitrator rejected some of the claims and allowed some of them and filed award before the Civil Court. The Government filed objections for setting aside the award, which were rejected by the Civil Court, which made the award rule of the Court. The Government then filed appeal before the High Court. The appeal was allowed by the High Court holding that in view of the relevant clause in the GOM, arbitrator could be appointed, therefore, while setting the award, appellant was permitted to convert his application under Section 8 of the Act into regular civil suit by carrying out necessary amendments. In those facts, the Supreme Court, relying on its earlier judgment in State of A.P. & Another v. Obulu Reddy, (1999) 9 SCC 568 held that aforesaid clause of the GOM cannot be held to be arbitration clause.

13. The Supreme Court in State of Orissa & Others v. Bhagyadhar Dash, (2011) 7 SCC 406, was dealing with a case in which Chief Justice of High Court appointed arbitrator holding that sentence in proviso to Clause 10 of conditions of contract was an arbitration agreement since it provided that in the event of dispute between parties as to claim for increase in rates for certain items decision of Superintending Engineer(SE) is final. The Supreme Court held that clause empowering Engineer-in-Charge to execute nontendered additional items of work and if contractor is satisfied with the determination of rate for such work, rate to be finally determined by Superintending Engineer, was an arbitration clause because it does (i) refer to arbitration as mode of settlement of disputes, (ii) provide for reference of disputes between parties to arbitration, (iii) make decision of Superintending Engineer binding on either party, (iv) provide or refer to any procedure which would show that Superintending Engineer has to act judicially after considering submissions of both parties, (v) disclose any intention to make Superintending Engineer an arbitrator in respect of disputes that may arise between parties, and (vi) make decision of Superintending Engineer final on any dispute other than on a claim for increase in rates for non-tendered items. It was further held that such decision of Superintending Engineer is a judicial determination, but mere decision of one party to the contract, which is open to challenge in a court of law. Such clause was, therefore, held to be an arbitration clause.

14. The Supreme Court in Vishnu (Dead) by LRs. v. State of Maharashtra & Others, (2014) 1 SCC 516 while considering Clause 30 of B-1 Agreements between the parties, which empowered Superintending Engineer to immediately resolve any controversy relating to specifications, designs, drawings, quality of workmanship or material used, etc. and providing that his decision shall be binding on contractor, held that such clause was an arbitration clause as power conferred upon Superintending Engineer is in the nature of departmental dispute resolution mechanism meant for expeditious sorting out of problems that arise during execution of work and nothing can be inferred from Clause 30 that parties had conferred role of arbitrator upon Superintending Engineer. Power conferred upon the Superintending Engineer to take decision on matters enumerated in Clause 30 did involve adjudication of any dispute or lis between Government and the contractor.

15. This judgment was later on followed in P. Dasaratharama Reddy Complex v. Government of Karnataka & Another, (2014) 2 SCC 201. Therein, the appellant contractor filed an application under Sections 11(6) and (8) of the Act of 1996 for appointment of an arbitrator for adjudication of all the disputes pertaining to a contract. The Designated Judge dismissed the application observing that Clause 29 of the contract cannot be construed as an arbitration agreement or an arbitration clause for settlement of disputes. As per Clause 29(a), any dispute or difference, irrespective of its nomenclature in matter, relating to specifications, designs, drawings, quality or workmanship or material used or any question relating to claim, right in any way arising out of or relating to the contract designs, drawings etc. or failure on the contractor's part to execute the work, whether arising during the process of the work or after its completion, termination or abandonment, had to be first referred to the Chief Engineer or the Designated Officer of the Department. Clause 29(b) provided that the Chief Engineer's decision in respect of every dispute or difference so referred shall be final and binding upon the contractor. Clause 29(c) provided for the remedy in case decision of Chief Engineer was acceptable to contractor then in such case he could approach the law courts for settlement of dispute, after giving due written notice in this regard to the Chief Engineer within a period of ninety days from the date of receipt of the written notice of the decision of the Chief Engineer. Clause 29(d) provided that if the Chief Engineer has given written notice of his decision to the contractor and no written notice to approach the law court has been communicated to him by the contractor within a period of ninety days from receipt of such notice, the same decision shall be final and binding upon the contractor. Clause 29(e) provided that if the Chief Engineer fails to give notice of his decision within a period of ninety days from the receipt of the contractors request in writing for settlement of any dispute or difference as aforesaid, the contractor may within ninety days after the expiry of the first named period of ninety days, approach the law courts, giving due notice to the Chief Engineer.

16. Thus, Clause 29 of the agreement in that case was quite similar to Clause 28 of the agreement in the present case, which has also been made subject to a rider given there below providing that in case either party fails to accept the award of the arbitrator, the other party may refer the matter to the court of law having jurisdiction at Jaipur only.

17. In Karnataka Power Transmission Corporation Limited & Another v. Deepak Cables (India) Limited, (2014) 11 SCC 148, Clause 48 of the agreement provided for disputes or differences arising out of performance of works to be referred to and settled by the Engineer within 30 days and his decision was to be final and binding on parties until completion of works. Construing said c

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lause as arbitration clause, the Designate Judge of the High Court appointed sole arbitrator to adjudicate matters in disputes. The Supreme Court held that said clause, having provided any procedure by which Engineer is required to act judicially by following principles of natural justice or to consider submissions of both parties, cannot be treated as arbitration clause. 18. In International Amusement Limited v. India Trade Promotion Organisation & Another, (2015) 12 SCC 677, the Supreme Court, following the judgment of P. Dasaratharama Reddy Complex (supra), held that essence of arbitration is adjudication of disputes by independent/neutral person/body. Clause 28 of the agreement in that case provided that in case of any dispute arising out of or in connection with this agreement, the disputes shall be referred to the sole arbitration of the Chairman, India Trade Promotion Organisation or his nominee whose decision/award shall be final, conclusive and binding on the parties. Such Clause though provided that in case of disputes, decision/award by officer or authority of one of the parties shall be final, conclusive and binding on the parties, yet it was held to be an arbitration clause. The Supreme Court in Payal Chawla Singh v. Coca-Cola Company & Another, (2015) 13 SCC 699 held that presence of clause providing for exclusive jurisdiction of courts in a particular city in contract negates claim of existence of arbitration clause in contract. 19. The cited judgment in Powertech World Wide Limited v. Delvin International General Trading LLC - (2012) 1 SCC 361, supra, is distinguishable on facts. Therein, the arbitration clause specifically provided that any dispute arising out of the purchase contract shall be settled amicably between both the parties or through the Arbitrator in India/UAE and the Court held that once the correspondence between the parties and attendant circumstances are read conjointly with petition for appointment of arbitrator and with particular reference to purchase contract, it becomes evident that parties had an agreement in writing and were ad idem in their intention to refer these matters to an arbitrator in accordance with provisions of the Arbitration and Conciliation Act, 1996. Such are not the facts in the present case. The judgment of the Supreme Court relied by the learned counsel for the petitioner in Visa International Limited, supra, is again distinguishable on facts as clause in that case clearly provided that any dispute arising out of this agreement, which cannot be settled amicably shall be finally settled in accordance with the Arbitration and Conciliation Act, 1996. The judgment of the Supreme Court in Mallikarjun, supra, relied on behalf of the petitioner, is also distinguishable because in that case Clause 30 of the agreement made the decision of the Superintending Engineer final and binding on all parties to the contract, whereas the present case did not make its enforceability depending on the decision of any civil court; in other words, did not require the parties to approach the civil court for enforcing the decision. 20. In view of above discussion, Clause 28 of the contract agreement between the parties cannot be held to be an arbitration clause. The application filed by the petitioner is therefore liable to be dismissed and it is accordingly dismissed.
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