S. Ravishankar vs. M/S. Sufi Enterprises

Facts

The petitioner, S. Ravishankar, filed a Civil Miscellaneous Petition under Section 11(6) of the Arbitration and Conciliation Act, 1996, seeking the appointment of an arbitrator. The dispute arose from a rental agreement dated June 29, 2022, entered into between the petitioner (landlord) and the respondent, M/s. Sufi Enterprises (lessee). The petitioner alleged arrears of rent amounting to Rs. 4,20,000/- along with GST, and an additional Rs. 18,900/- for August 2022. A notice was issued to the respondent on November 30, 2022. The respondent replied on December 1, 2022, denying the claims. The petitioner then invoked the arbitration clause (Clause 10) on January 16, 2023, proposing a retired District Judge as arbitrator. The respondent did not reply to this notice, leading the petitioner to approach the High Court.

Held

The Court held that the petitioner had complied with the requirements of Section 11 of the Arbitration and Conciliation Act, 1996. Since the respondent did not contest the petitioner's claims or submissions and remained unrepresented, the Court found no impediment to allowing the petition. The Court accepted the petitioner's contentions and proceeded to appoint Shri Moosa Kunhi Nayarmoole, a retired District Judge, as the sole arbitrator. The arbitrator is to conduct the proceedings at the Arbitration and Conciliation Centre (Domestic and International), Bengaluru, according to its rules. All contentions between the parties are left open for adjudication in the arbitration proceedings. The Court directed its office to communicate the order to the Arbitration Centre and the appointed arbitrator.

Key Issues

1. Whether the Court should appoint an arbitrator under Section 11(6) of the Arbitration and Conciliation Act, 1996, given the existence of an arbitration clause in the rental agreement and the petitioner's compliance with procedural requirements? The petitioner argued that a rental agreement dated June 29, 2022, contained an arbitration clause (Clause 10). Following a dispute over rent arrears and GST, the petitioner issued a notice invoking arbitration and proposed an arbitrator. The respondent failed to respond to this notice. The petitioner contended that all necessary steps under Section 11 of the Act had been followed, and therefore, the Court should appoint an arbitrator to resolve the dispute. The respondent, though served, remained unrepresented and did not present any arguments.