# INDTEL Technical Services Private Limited v. W.S. Atkins

- **Citation:** [2018] 11 S.C.R. 645
- **Court:** Supreme Court of India
- **Decided:** 2018-09-14
- **Bench:** Dipak Misra, A.M. Khanwilkar, Dr. D. Y. Chandrachud
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/indtel-technical-services-private-limited-v-w-s-atkins-32368
- **Pages:** 5

## Headnote

Arbitration and Conciliation Act, 1996: s. 11(5) - Arbitration
petition under - Seeking constitution of an arbitral tribunal with a
sole arbitrator to adjudicate the claims of petitioner under the
Commission Processing Contract - Dispute resolution clause
between the parties that the disputes to be settled through
consultation and in case the consultation fails, then by arbitration
or court - Held: Intention of the parties apparent from the dispute
resolution clause, is that efforts have to be made to settle the disputes
in an amicable manner and, therefore, two options are available,
either to go for arbitration or for litigation in a court of law - Thus,
there is an option and the petitioner has invoked the arbitration
clause - In view thereof, former Judge of the Supreme Court,
appointed as sole Arbitrator to arbitrate upon the disputes which
have arisen between the parties - Arbitrator to complete arbitration
proceedings as per the Arbitration & Conciliation (Amendment) Act,
2015 - Arbitration & Conciliation (Amendment) Act, 2015.
INDTEL Technical Services Private Limited v. W.S. Atkins
Rail Limited (2008) 10 SCC 308 - referred to.
Case Law Reference
(2008) 10 SCC 308
referred to
Para 8
CIVIL ORIGINAL JURISDICTION: Arbitration Petition (Civil)
No. 22 of 2018.
Under Section 11(5) of the Arbitration and Conciliation Act, 1996
for appointment of Arbitrator under Clause 15 of the Commission
Processing Contract dated 11.09.2014.
 645
[2018] 11 S.C.R. 645
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SUPREME COURT REPORTS
[2018] 11 S.C.R.
Ms. Nandini Gidwaney, Mudit Sharma, Advs. for the Petitioner.
D. N. Ray, Lokesh K. Choudhary, Ms. Disha Ray, Dilip Kumar
Nayak, Mrs. Sumita Ray, Advs. for the Respondent.

## Text

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M/S. ZHEJIANG BONLY ELEVATOR GUIDE RAIL
MANUFACTURE CO. LTD.
v.p
M/S. JADE ELEVATOR COMPONENTS
(Arbitration Petition (Civil) No. 22 of 2018)
SEPTEMBER 14, 2018
[DIPAK MISRA, CJI., A.M. KHANWILKAR AND
DR. D. Y. CHANDRACHUD, JJ.]
Arbitration and Conciliation Act, 1996: s. 11(5) - Arbitration
petition under - Seeking constitution of an arbitral tribunal with a
sole arbitrator to adjudicate the claims of petitioner under the
Commission Processing Contract - Dispute resolution clause
between the parties that the disputes to be settled through
consultation and in case the consultation fails, then by arbitration
or court - Held: Intention of the parties apparent from the dispute
resolution clause, is that efforts have to be made to settle the disputes
in an amicable manner and, therefore, two options are available,
either to go for arbitration or for litigation in a court of law - Thus,
there is an option and the petitioner has invoked the arbitration
clause - In view thereof, former Judge of the Supreme Court,
appointed as sole Arbitrator to arbitrate upon the disputes which
have arisen between the parties - Arbitrator to complete arbitration
proceedings as per the Arbitration & Conciliation (Amendment) Act,
2015 - Arbitration & Conciliation (Amendment) Act, 2015.
INDTEL Technical Services Private Limited v. W.S. Atkins
Rail Limited (2008) 10 SCC 308 - referred to.
Case Law Reference
(2008) 10 SCC 308
referred to
Para 8
CIVIL ORIGINAL JURISDICTION: Arbitration Petition (Civil)
No. 22 of 2018.
Under Section 11(5) of the Arbitration and Conciliation Act, 1996
for appointment of Arbitrator under Clause 15 of the Commission
Processing Contract dated 11.09.2014.
 645
[2018] 11 S.C.R. 645
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SUPREME COURT REPORTS
[2018] 11 S.C.R.
Ms. Nandini Gidwaney, Mudit Sharma, Advs. for the Petitioner.
D. N. Ray, Lokesh K. Choudhary, Ms. Disha Ray, Dilip Kumar
Nayak, Mrs. Sumita Ray, Advs. for the Respondent.
The Judgment of the Court was delivered by
DIPAK MISRA, CJI 1. In the instant arbitration petition,
preferred under Section 11(5) of the Arbitration and Conciliation Act,
1996 (for brevity, 'the Act'), the petitioner seeks for constitution of an
arbitral tribunal with a sole arbitrator to adjudicate the claims of the
petitioner under the Commission Processing Contract dated 11.09.2014
and to pass such further order as may be deemed fit and proper in the
facts and circumstances of the case.
2. The petitioner, company incorporated under the laws of People's
Republic of China having its office at Sanquiao Village, Fuchun Street,
Fuyang, China, is engaged in the business of, inter alia, exporting and
supplying high quality elevator guiderails, fish-plates, accessories and
allied goods. The respondent, a partnership firm based in India having
its office at Plot No.455, Road No.11, "A" Cross Road, GIDC, Kathwada,
Ahmedabad - 382430, Gujarat, is engaged in the business of supplying
elevator components for use in the modernization of existing lifts and the
new design of the elevator.
3. The contract, namely, Commission Processing Contract
(hereinafter referred to as 'the Contract') was entered into between the
parties on 11.09.2014 in respect of supply of certain products under the
Contract. In the course of performance of the Contract, as certain
differences had arisen and the parties were unable to amicably settle
the disputes which fell within the scope of the arbitration clause, the
petitioner appointed Justice V.S. Agarwal, former Judge, High Court of
Judicature at New Delhi as the sole arbitrator. On 30.03,2018, the
petitioner called upon the respondent to consent to the appointment of
the sole arbitrator within a period of thirty days from the receipt of the
notice. The respondent received the said notice on 31.03.2018 and the
respondent in its reply dated 05.04.2018 refused to concur and consent
to the appointment of the sole arbitrator. Because of the aforesaid
situation, the petitioner has been compelled to move this Court for
appointment of the sole arbitrator. When the matter was listed before
this Court after service of notice, the learned counsel for the respondent
has placed reliance on the reply dated 05.04.2018 given by the counsel
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for the respondent. In the said reply, the facts asserted by the petitioner
have been disputed. That apart, it has been stated that the claims put
forth are beyond the provisions of the Contract.
4. To appreciate the controversy, it is required to be seen whether
there is an arbitration clause for resolution of the disputes. Clause 15 of
the agreement as translated in English reads as follows:-
"15. Dispute handling:
Common processing contract disputes, the parties should be settled
through consultation; consultation fails by treatment of to the
arbitration body for arbitration or the court."
5. It is submitted by learned counsel for the petitioner that if the
clause of 'dispute handling' is scrutinized appropriately, the disputes are
to be settled through consultation and, if the consultation fails by treatment
of to the arbitration body for arbitration or Court and, therefore, the
matter has to be referred to arbitration. It is canvassed by him that the
clause is not categorically specific that it has to be adjudicated in a court
of law. It leads to choices and the choice expressed by the petitioner is
arbitration.
6. Learned counsel for the respondent, in his turn, would urge
that when it is stated arbitration or Court, the petitioner should knock at
the doors of the competent court but not resort to arbitration, for the
clause cannot be regarded as an arbitration clause which stipulates that
the disputes shall be referred to arbitration.
7. To appreciate the clause in question, it is necessary to appositely
understand the anatomy of the clause. It stipulates the caption given to
the clause 'dispute handling'. It states that the disputes should be settled
through consultation and if the consultation fails by treatment of to the
arbitration body for arbitration or the court. On a query being made,
learned counsel for the parties very fairly stated that though the translation
is not happily worded, yet it postulates that the words "arbitration or the
court" are undisputable as far as the adjudication of the disputes is
concerned. There is assertion that disputes have arisen between the
parties. The intention of the parties, as it flows from the clause, is that
efforts have to be made to settle the disputes in an amicable manner
and, therefore, two options are available, either to go for arbitration or
for litigation in a court of law.
M/S. ZHEJIANG BONLY ELEVATOR GUIDE v. M/S. JADE
ELEVATOR COMPONENTS [DIPAK MISRA, CJI]
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SUPREME COURT REPORTS
[2018] 11 S.C.R.
8. This Court had the occasion to deal with such a clause in the
agreement in INDTEL Technical Services Private Limited vs. W.S.
Atkins Rail Limited1. In the said agreement, clause No.13 dealt with
the settlement of disputes. Clauses 13.2 and 13.3 that throw light on the
present case were couched in the following language:-
"13.2. Subject to Clause 13.3 all disputes or differences arising
out of, or in connection with, this agreement which cannot be
settled amicably by the parties shall be referred to adjudication;
13.3. If any dispute or difference under this agreement touches
or concerns any dispute or difference under either of the subcontract agreements, then the parties agree that such dispute or
difference hereunder will be referred to the adjudicator or the
courts as the case may be appointed to decide the dispute or
difference under the relevant sub-contract agreement and the
parties hereto agree to abide by such decision as if it were a
decision under this agreement."
9. Interpreting the aforesaid clauses, the Judge designated by the
learned Chief Justice of India held thus:-
"Furthermore, from the wording of Clause 13.2 and Clause 13.3,
I am convinced, for the purpose of this application, that the parties
to the memorandum intended to have their disputes resolved by
arbitration and in the facts of this case the petition has to be
allowed."
10. The aforesaid passage makes it clear as crystal that emphasis
has been laid on the intention of the parties to have their disputes resolved
by arbitration.
11. In the case at hand, as we find, Clause 15 refers to arbitration
or court. Thus, there is an option and the petitioner has invoked the
arbitration clause and, therefore, we have no hesitation, in the obtaining
factual matrix of the case, for appointment of an arbitrator and,
accordingly, Justice Prakash Prabhakar Naolekar, formerly a Judge of
this Court, is appointed as sole Arbitrator to arbitrate upon the disputes
which have arisen between the parties. The learned Arbitrator shall be
guided by the Arbitration & Conciliation (Amendment) Act, 2015. The
learned Arbitrator shall make positive efforts to complete the arbitration
proceedings as per the Act of 2015.
1 (2008) 10 SCC 308
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12. The Registry is directed to send a copy of this order to the
sole Arbitrator. Learned counsels for the parties are also at liberty to
bring it to the notice of the Arbitrator.
13. The arbitration petition is, accordingly, allowed. There shall
be no order as to costs.
Nidhi Jain
Petition allowed.
M/S. ZHEJIANG BONLY ELEVATOR GUIDE v. M/S. JADE
ELEVATOR COMPONENTS [DIPAK MISRA, CJI]