Delhi High Court
Radico Khaitan Limited vs Sumit Chauhan on 20 December, 2024
Author: Sachin Datta
Bench: Sachin Datta
$~17
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of Decision : 20.12.2024
+ ARB.P. 1513/2024
RADICO KHAITAN LIMITED .....Petitioner
Through: Mr. Kamal Garg, Advocate.
versus
SUMIT CHAUHAN .....Respondent
Through: None.
CORAM:
HON'BLE MR. JUSTICE SACHIN DATTA
SACHIN DATTA, J. (Oral)
1. The present petition has been filed under section 11(6) of the
Arbitration and Conciliation Act, 1996 (hereinafter referred as ‘the A&C
Act’) seeking appointment of a sole arbitrator to adjudicate the disputes
between the parties.
2. The disputes between the parties have arisen in the context of
business transactions between the petitioner, the respondent and father of the
respondent, in terms of which the petitioner supplied alcoholic beverages
i.e., Indian made Foreign Liquor (IMFL), Wine, Spirit, Whisky, Rum and
other liquor products to the respondent and his father either itself or through
its associated or subsidiary or sister concerns/units.
3. It is averred in the petition that although respondent and his father had
separate business, the respondent assured and committed to also discharge
the liability arising out of the purchase of goods/liquor by his father from the
petitioner.
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4. Therefore, it is stated that upon purchase of the goods/liquor by the
respondent and his father, the petitioner either itself or through its subsidiary
or associated or sister concerns/units issued tax invoices in the name of the
respondent.
5. It is submitted that the business transactions between the parties were
agreed to be governed by an arbitration clause contained in the tax invoices
issued to the respondent by the petitioner. The tax invoices contain an
arbitration clause as under:
“5. Any dispute (whether contractual or otherwise) arising out of this
transaction between the parties or arising out of or relating to or in
connection with this invoice shall be referred for arbitration in terms of
Arbitration and Conciliation Act, 1996 or any amendment thereof. The
arbitration shall be conducted by a sole arbitrator to be appointed by
Radico Khaitan Limited in its sole discretion. The seat of Arbitration
shall be Delhi. This invoice shall be governed the laws of India and
Court of Delhi shall have exclusive jurisdiction over matters arising from
this transaction/invoice. The Buyer shall be deemed to have accepted all
terms and conditions contained in the invoice including the arbitration
agreement by accepting the goods delivered under this invoice”
6. Dispute/s have arisen between the parties on account of alleged failure
of the respondent towards collective and complete discharge of outstanding
liability existing in the books of account of the petitioner against the
respondent and his father for purchase of the goods/liquor supplied by the
petitioner.
7. It is submitted that that a cheque of Rs. 18,16,155/- was issued by the
respondent for the complete and collective discharge of outstanding liability
of the respondent and his father. However, it is stated that upon presentation,
the cheque was dishonoured due to insufficient funds. Pursuant to which,
despite repeated reminders and requests, the respondent failed to pay the
requisite outstanding amount.
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8. Consequently, the petitioner issued a legal notice dated 18.06.2022
under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter
referred as “the NI Act“) to the respondent followed by a complaint under
Section 138 of the NI Act before the Patiala House Court, New Delhi, Delhi.
9. Since the disputes between the parties persisted, the petitioner issued
a demand notice cum Invocation of Arbitration on 05.02.2024 to the
respondent. However, the respondent failed to respond.
10. In the above circumstances, the petitioner has approached this Court,
through the present petition, seeking the appointment of a sole arbitrator to
adjudicate the dispute.
11. In the present proceedings, notice was issued by the Court on
27.09.2024. However, since none appeared on behalf of the respondent, vide
order dated 14.11.2024, a fresh notice was issued by the Court with a liberty
to the respondent to file a reply, if any, before the next date of hearing. An
affidavit of service dated 19.12.2024, filed on behalf of the petitioner states
the communication/s sent to the last known address/es via speed post were
returned with the notation, “Item Returned Addressee left without
instructions, “item returned unclaimed” and “item returned, no such person
in the address”.
12. Further, as per the records, it is brought out that the communication/s
served through dasti by ordinary/physical mode and registered speed post
were returned with notations “unserved-given addresses/premises found
locked” whereas notice sent by the registry of this Court via whatsapp at
+91-9811082604 was duly served.
13. Section 3 of the A&C Act contemplates that a written communication
is deemed to have been received if it is sent to the addressee’s last known
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place of business or mailing address by any means which provides a record
of the attempt to deliver it. In the present case, the petitioner has made
numerous attempts to effect service on the respondent and has thereby
discharged its onus to effect service on the respondent.
14. In the circumstances, the present petition is taken up for hearing and
disposal, despite no appearance on behalf of the respondent.
15. Since the existence of the arbitration clause is evident from a perusal
of the contract, there is no impediment to constituting an arbitral tribunal for
adjudicating the disputes between the parties, as mandated in terms of the
judgments of the Supreme Court in SBI General Insurance Co. Ltd. v.
Krish Spinning, 2024 INSC 532 and Interplay between Arbitration
Agreements under the Arbitration & Conciliation Act, 1996 & the Indian
Stamp Act, 1899, In re, 2023 SCC OnLine SC 1666.
16. Further, in terms of the judgments of the Supreme Court in Perkins
Eastman Architects DPC v. HSCC (India) Ltd (2020) 20 SCC 760, TRF
Limited v. Energo Engineering Projects Ltd, (2017) 8 SCC 377 and Bharat
Broadband Network Limited v. United Telecoms Limited, 2019 SCC
OnLine SC 547, it is incumbent on this Court to appoint an independent sole
arbitrator to adjudicate the disputes between the parties.
17. Accordingly, Ms. Amrita Sarkar, Advocate (Mobile – +91
7045438897) is appointed as the Sole Arbitrator to adjudicate the disputes
between the parties.
18. The learned Sole Arbitrator may proceed with the arbitration
proceedings subject to furnishing to the parties requisite disclosures as
required under Section 12 of the A&C Act.
19. The learned Sole Arbitrator shall be entitled to fee in accordance with
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IVth Schedule to the A&C Act; or as may otherwise be agreed to between
the parties and the learned Sole Arbitrator.
20. The parties shall share the arbitrator’s fee and arbitral costs, equally.
21. All rights and contentions of the parties in relation to the
claims/counter-claims are kept open, to be decided by the learned Arbitrator
on their merits, in accordance with law.
22. Needless to say, nothing in this order shall be construed as an
expression of this Court on the merits of the case.
23. The present petition stands disposed of in the above terms.
SACHIN DATTA, J
DECEMBER 20, 2024/sl
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