Calcutta High Court
H P Ispat Private Limited vs Ismail Seikh on 18 August, 2025
Author: Shampa Sarkar
Bench: Shampa Sarkar
OCD 6
ORDER SHEET
AP-COM/600/2025
IN THE HIGH COURT AT CALCUTTA
COMMERCIAL DIVISION
ORIGINAL SIDE
H P ISPAT PRIVATE LIMITED
VS
ISMAIL SEIKH
BEFORE:
The Hon'ble JUSTICE SHAMPA SARKAR
Date: 18th August, 2025.
Appearance:
Mr. Debraj Sahu, Adv.
Ms. Antara Biswas, Adv.
Mr. Tamoghna Saha, Adv.
...for the petitioner
Mr. Sanjay Saha, Adv.
Mr. L.R. Mandal, Adv.
Mr. Probal Sarkar, Adv.
Mrs. S.K. Kiran, Adv.
...for the respondent
The Court:
1. Affidavit of service is taken on record.
2. This is an application for appointment of an arbitrator in terms of the
Dispute Resolution Clause mentioned in the petitioner’s invoices which
were raised by the petitioner on the respondent, in respect of supply of
goods/TMT bars and other metallic products. The petitioner claims to
be a manufacturer and supplier of TMT bars and metallic products.
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The petitioner claims that the respondent wanted dealership of the
products. The parties agreed to such business transaction and it is
contended by the petitioner that substantial goods were supplied to the
proprietorship concern of the respondent, namely, M/s. Ismail
Builders.
3. Mr. Sahu, learned advocate submits that goods worth
Rs.1,33,08,282/- was supplied to the respondent and the invoices were
raised. The respondent accepted the goods on the basis of the invoices.
Each of the invoices contain an arbitration clause. According to Mr.
Sahu, an invoice is also an agreement. The invoices contain details of
the goods supplied. Acceptance of such an invoice, will be a concluded
contract. It is submitted that, upon delivery of the goods and
acceptance of the invoices by the respondent, payment to the extent of
Rs.89,64,008/- had been made. The dues as on the date of invocation
was Rs.43,44,274/-.
4. Mr. Saha, learned advocate for the respondent opposes the prayer on
the ground that no agreement had been entered into between the
parties. The specific contention of Mr. Saha is that the claim is neither
admissible nor arbitrable. The parties are not bound by any
arbitration clause. It is further contended that, the petitioner owes
money to the respondent.
5. Having considered the rival contentions of the parties, this Court finds
that the invoices contain item wise details of the goods supplied, the
quantity, rate, the gross amount payable, the SGST and CGST amount
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etc. It is not in dispute that the respondent acted on the basis of the
said invoices and made payments. The invoices were part of the same
business transaction and consolidated payment was made by the
respondent. Each of the invoices contain an arbitration clause. In M/s.
Flint Group India Private Limited vs. M/s. Good Morning India
Media Private Limited reported in 2017 SCC Online Del 7894,
Beacon Electronics vs. Sylvania & Laxman Ltd. reported in 1998
SCC Online Del 16 and Jatin Koticha vs. VFC Industries Pvt. Ltd.
reported in (2007) SCC Online Bom 1092, it had been held that an
invoice could be treated as a contract between the parties if the details
of the goods supplied and delivered were available from the same.
Reference is also made to the decision of the Bombay High Court in
Sanjiv Manmohan Gupta vs Sai Estate Consultants Chembur Pvt.
Ltd reported in 2025 SCC OnLine Bom 567 in this context.
6. In the matter of Sanjiv Manmohan (supra), the Bombay High Court
held as follows:-
“10. A Learned Single Judge (Bharati Dangre J.) of this Court in the
case of Bennett Coleman1 had occasion to consider an arbitration
clause contained in tax invoices raised in the course of dealings.
Taking note of the case law cited in that case, the Learned Single
Judge ruled thus:
27. Since in the present case, it can be clearly seen that the
parties have acted upon the invoices and there was no denial
of the invoices raised by the applicant, the clause contained in
the invoices which clearly stipulate a reference to arbitration,
deserve to be construed as an arbitration clause. The decision of
this Court in case of Concrete Additives (supra) is delivered in the
peculiar facts of the case and the law being well crystallized to
the effect that any document in writing exchanged between
the parties which provide a record of the agreement and in
4respect of which there is no denial by the other side, would
squarely fall within the ambit of Section 7 of the Arbitration
and Conciliation Act, 1996 and would amount to an
arbitration clause. The objection raised by the respondent thus
stand overruled and by accepting that the clause contained in
the tax invoice amount to an arbitration clause, I am persuaded
to exercise the powers under subsection 6 of Section 11 of the Act and
pass the following order:”
7. [Emphasis Supplied]
11. The very same principles would apply to the case at hand. The
parties indeed acted upon the tax invoices. Cheques were issued. If
the arbitration clause in the tax invoices was not acceptable, there
would have been a resistance to it. Since there were multiple
invoices, there were multiple opportunities to object to them.
Instead, the invoices were indeed processed and cheques were
issued. Therefore, whether the party accepting the invoice was
authorised to bind the Respondent to an arbitration agreement also
becomes a moot issue. The Respondent, in processing the invoices
engaged with the Applicant and continued to do so. In any case,
examining whether there is a prima facie existence of a formal
arbitration agreement is what falls within the scope of my
jurisdiction.
12. The scope of review under Section 11 is explicitly set out in
Section 11(6A) of the Act. It is now trite law, with particular regard
to the decisions of a seven-judge Bench in the Interplay
Judgment2 followed by multiple others, including SBI
General3 and Patel4 that the Section 11 Court ought not to venture
beyond examining the existence of a validly existing arbitration
agreement that has been formally executed. Even questions of
existential substance is a matter that falls squarely in the domain of
the arbitral tribunal, in view of Section 16 of the Act.”
7. In the matter of M/s. Flint Group (supra), the Delhi High Court held as
follows:-
“6. A perusal of the invoices filed by the petitioner on which reliance is
placed in the plaint would show that the details of the goods which are
sought to be sold, the price, the details of the purchaser of the goods
and some terms and conditions are clearly stated in the invoices. This
court in the case of Bharat Forge Ltd. v. Onil Gulati (supra) held as
follows:–
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“11. That an invoice which incorporates the particulars of seller,
purchaser, description of goods, weight, quantity, rates and price
including sales tax and other dues, accompanied with additional terms
as noticed in the present case would be regarded as a written contract
on acceptance by the respondent is no longer res integra.”
8. In the matter of Jatin Koticha (supra), the Bombay High Court held as
follows:-
“6. Now it is clear that there is no written contract signed by both the
parties relied on by the plaintiff. It is not the requirement of the law
that it should be a written contract signed by both the parties. What is
necessary is that the suit should be based on a written contract. That,
one can find in this case, in the form of invoices which were raised on
the defendants along with delivery of the goods in pursuance of each
purchase order. The invoices, as stated above, contained the terms and
conditions. There is a clear parole acceptance of the invoice on the part
of the defendants. The defendants accepted delivery of the goods along
with the invoice without any demur or suggestion that they do not
accept any of the terms whether pertaining to the rate, price,
quantity etc. It makes no difference therefore that the invoices are not
signed by both the parties. I am of view that the invoices must be
treated as a written contract and the suit based on such invoices is a
suit based on the written contract. This view is fortified by the Madras
High Court reported in The Madras Law Journal Reports 1988 page
187 (Lucky Electrical Stores, by partner Mahendra Kumar
Shah v. Ramesh Steel House by Partner Babulat)1 where the Chief
Justice M.N. Chandurkar, rejected the contention similar to the one
applied by the defendants in this case. The relevant observation reads
thus:
“……What is necessary for the purposes of this case is that a liquidated
demand in money must arise on a written contract. A written contract
or a contract in writing need not always be a contract signed by both
parties. The Court of Appeal in (T.A. Rufand Company Ltd. v. Pauwels)2,
(1919) 1 K.B. 660, was called upon to construe the words “contract in
writing”. The facts of that case were that by contract dated 28th
February, 1918 Pauwels had sold to Ruf and Company a quantity of
soap. The terms of the contract were contained in a sold note signed
only by Pauwels. At the foot of the sold note were the words “Please
confirm the above”. A dispute arose under the contract as to non-
delivery of part of the soap and was referred to arbitration in
accordance with the Clause contained in the note. In the award made
by the arbitrators there was a recital that “by a contract in writing
made by Alphonse Pauwela with T.A. Ruf and Co. Ltd., dated the 28th
day of February, 1918, Alphonse Pauwels contracted to sell and
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deliver” a certain quantity of soap to Ruf and Co. at a certain price and
that a dispute had arisen which was referred to arbitration. By the
award which was against the purchasers the purchasers were directed
“to pay the costs of the reference, arbitration and award, including
361.15s. our fees and expenses in regard to the said arbitration, as we
consider that their conduct in not confirming in writing the contract
was probably the cause of the dispute”. This award was sought to be
set aside on the ground that “it is bad in law and shows error on its
face and shows further that there was no legal contract binding on the
parties”. The Divisional Court ordered the award to be set aside on the
ground that on the face of the award the arbitrators had treated as a
contract in writing binding upon both parties that which was signed by
one of the parties only and was therefore not a contract in writing. Ruf
and Company appealed against this judgment. Warrington L.J., in his
judgment referred to the fact that though written confirmation was not
sent by the purchasers, the arbitrators had come to the conclusion
that there was a parol acceptance by Ruf & Co. of the terms of the sold
note, and observed as follows:–
“Taken in conjunction with the rest of the award they seem to me to
indicate that the arbitrators found that Ruf and Co.” had confirmed the
contract though not in writing, and if so they may quite properly refer
to the contract as a “contract in writing”. Although the memorandum of
it was signed by one party only”.
9. Under such circumstances, when the invoices contain an arbitration
clause and when it is an admitted position that the goods were delivered
by the petitioner upon furnishing the invoices and the respondent paid a
part of the amount claimed on the basis of the invoices, the arbitration
clause in the said invoices, in my prima facie view would be binding
between the parties. However, the respondent is at liberty to raise the
question of jurisdiction of the learned arbitrator and the issue of non-
arbitrability. Such objections can be decided by the learned arbitrator
under Section 16 of the Arbitration and Conciliation Act, 1996. Mr. Saha
claims that the petitioner had actually defaulted in delivering the goods,
inspite of receiving substantial advance payment. Such submission is also
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a question of fact, which must be decided by the learned Arbitrator. Thus,
the entire claim will be decided along with the objections raised by the
respondent.
10. Under such circumstances, the Court appoints Mr. Farhan Gaffar,
learned Advocate (Mob. No.9830179148), as the Arbitrator, to arbitrate
upon the disputes between the parties. This appointment is subject to
compliance of Section 12 of the Arbitration and Conciliation Act, 1996.
The learned Arbitrator shall fix his own remuneration as per the Schedule
of the Act.
11. AP-COM/600/2025 is, accordingly, disposed of.
(SHAMPA SARKAR, J.)
B.Pal