Fresenius Medical Care Dialysis Services INDIA Private Limited vs. Family Health Care Hospital PVT LTD.
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The petitioner, Fresenius Medical Care Dialysis Services India Private Limited, filed a petition under Section 11 of the Arbitration and Conciliation Act, 1996, seeking the appointment of an arbitrator. The petitioner had entered into a Service Agreement dated 08.11.2017 with Clearmedi Health Care Private Limited for providing dialysis services. The respondent, Family Health Care Hospital Pvt Ltd, owned the hospital. The agreement contained an arbitration clause. On 01.02.2020, the agreement between the petitioner and Clearmedi was terminated, and the respondent assumed management of the dialysis services. The petitioner continued to provide services and raise invoices under the name "Clearmedi," despite the respondent's communication that billing should be in the respondent's name and GST number. The petitioner contended that the respondent is the assignee of Clearmedi and thus bound by the arbitration clause.
Held
The Court allowed the petition and appointed Ms. Shyel Trehan, Senior Advocate, as the Sole Arbitrator. The Court reasoned that while the respondent raised a preliminary objection regarding not being a signatory to the arbitration agreement, they ultimately had no objection to the appointment of an arbitrator, provided all rights and contentions were left open for adjudication. The Court directed that the arbitration would be held under the aegis of the Delhi International Arbitration Centre (DIAC), with remuneration as per DIAC rules. The arbitrator was requested to furnish a declaration under Section 12 of the Act. Crucially, the Court made it clear that all rights and contentions of the parties, including the arbitrability of any claim, preliminary objections, claims, counter-claims, and the merits of the dispute, were left open for the learned arbitrator to adjudicate. The parties were directed to approach the arbitrator within two weeks. The specific contention of the respondent that they are not a signatory to the Arbitration Agreement will also be addressed by the Arbitrator.
Key Issues
1. Whether an arbitrator can be appointed under Section 11 of the Arbitration and Conciliation Act, 1996, when the respondent is not a signatory to the original Service Agreement containing the arbitration clause, but is alleged to be an assignee of the original contracting party? (Question of mixed law and fact, turning on Section 11 and the principles of assignment and arbitration agreements). Petitioner's arguments: The petitioner argued that the respondent is the assignee of Clearmedi Health Care Private Limited and, therefore, is bound by the arbitration clause in the Service Agreement. They relied on the principle that an assignee steps into the shoes of the assignor. Respondent's arguments: The respondent contended that there is no signed agreement between the petitioner and the respondent, and consequently, no Arbitration Agreement exists. However, the respondent stated they had no objection to the appointment of an arbitrator, with all rights and contentions, including the absence of a signed agreement, left open for adjudication by the arbitrator.
Sections Cited
Section 11, Section 12
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
O R D E R % 08.04.2025
This is a petition filed under section 11 of Arbitration and Conciliation Act, 1996, seeking appointment of an arbitrator for adjudication of disputes between the parties.
The case of the petitioner is that the petitioner entered into a Service Agreement dated 08.11.2017 with entity called “Clearmedi Health Care Private Limited” for providing dialysis services in hospital called “Clearmedi Hospital and Cancer Center”. The hospital was owned by the respondent.
The said Agreement contains arbitration clause, being Clause No. 19.4, which reads as under:- “19.4 Governing Law; Dispute Resolution and This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 30/06/2025 at 23:35:13
Juri iction a) This Agreement shall be governed by and construed according to the laws of India. b) Any dispute, controversy, claims or disagreement of any kind whatsoever between or among the Patties in connection with or arising out of this Agreement, including the interpretation or construction of any word, expression or clause contained herein, or any claim for damages or a dispute alleging fraud or nullity hereof, shall be referred for resolution, to a sole arbitrator (jointly appointed by both Parties), through arbitration to be conducted in accordance with the Arbitration and Conciliation Act, 1996, or such statutory modification thereof in force at the time of such reference or commencement of arbitration. The venue of such arbitration shall be New Delhi. All proceedings of such arbitration, including, without limitation, any awards, shall be in the English language. The award shall be final and binding on the Parties. c) The Patties shall have the right to apply to a court of competent juri iction, within the meaning of Section 2(l)(e) of the Arbitration and Conciliation Act, 1996, or such statutory modification thereof in force at the time of such reference or commencement of arbitration, to obtain interim injunctive relief in This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 30/06/2025 at 23:35:13
respect of any dispute, pending resolution of such dispute in accordance with Clause 19.4(6)”
On 01.02.2020, the Agreement between the petitioner and Clearmedi was terminated and the respondent assumed the operation and management of the dialysis services.
Subsequently, the petitioner continued to provide the services and raised invoices under the name of “Clearmedi”. The respondent continuously informed to the petitioner that the billing was in the wrong company name and GST number and the same was to be done in the name of “Family Health Care Hospital Private Limited”.
The case of the petitioner is that the respondent is the assignee of Clearmedi Hospital Health Care Private Limited and hence, is bound by the arbitration clause.
It is the contention of Mr. Arora, learned counsel appearing for the respondent that there is no signed agreement between the petitioner and the respondent and hence, there is no Arbitration Agreement. However, he has no objection if an Arbitrator is appointed and all the rights and contentions including the above are left open to be adjudicated by the learned Arbitrator.
For the said reasons, the petition is allowed and the following directions are issued:- i) Ms. Shyel Trehan, Senior Advocate (Mobile No. 9810163818) is appointed as a Sole Arbitrator to adjudicate the disputes between the parties. ii) The arbitration will be held under the aegis of the Delhi This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 30/06/2025 at 23:35:13
International Arbitration Centre, Delhi High Court, Sher Shah Road, New Delhi (hereinafter, referred to as the ‘DIAC’). iii) The remuneration of the learned Arbitrator shall be in terms of DIAC (Administrative Cost and Arbitrators’ Fees) Rules, 2018. iv) The learned Arbitrator is requested to furnish a declaration in terms of Section 12 of the Act prior to entering into the reference. v) It is made clear that all the rights and contentions of the parties, including as to the arbitrability of any of the claim, any other preliminary objection, as well as claims/counter-claims and merits of the dispute of either of the parties, are left open for adjudication by the learned arbitrator. vi) The parties shall approach the learned Arbitrator within two weeks from today. vii) The contention of the respondent that it is not a signatory to the Arbitration Agreement and hence, the proceedings cannot lie, will also be addressed by the Arbitrator.
The present petition is disposed of in the aforesaid terms. JASMEET SINGH, J APRIL 8, 2025/pk Click here to check corrigendum, if any This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 30/06/2025 at 23:35:13
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