Jones Lang Lasalle Property Consultants INDIA PVT. LTD. vs. Rajasthan Urban Drinking Water Sewerage And Infrastructure Corporation Limited

Facts

The petitioner, Jones Lang Lasalle Property Consultants India Pvt. Ltd., entered into a contract with the respondent, Rajasthan Urban Drinking Water Sewerage and Infrastructure Corporation Limited, for consultancy services related to advertisement tax improvement in AMRUT cities. The contract, executed on July 19, 2017, was for a period of 9 months, with a total consideration of Rs. 72,90,000/- plus GST. Disputes arose regarding the petitioner's monetary entitlement. The General Conditions of Contract (GCC) and Special Conditions of Contract (SCC) stipulated a dispute resolution mechanism involving arbitration. The petitioner invoked arbitration on July 27, 2021, nominating its arbitrator. The respondent acknowledged the invocation but failed to appoint its arbitrator within the stipulated 30 days. Consequently, the petitioner approached the Indian Council of Arbitration (ICA) for the appointment of a sole arbitrator. However, the ICA did not act due to the respondent's belated appointment of its nominee arbitrator, leading the petitioner to file the present petition under Section 11(6) of the Arbitration and Conciliation Act, 1996.

Held

The Court held that the parties were in agreement that an independent sole arbitrator should be appointed to adjudicate the disputes. The Court proceeded to appoint Mr. Jayant Kumar, Advocate, as the sole arbitrator. The parties were granted liberty to raise their respective claims and counter-claims before the arbitrator. The Court also specified that it would be open for the respondent to raise jurisdictional or preliminary objections regarding the claims, which the arbitrator would need to consider and decide in accordance with the law. The seat of arbitration was determined to be Delhi, but the venue could be Jaipur if requested by a party. The arbitrator was directed to furnish requisite disclosures under Section 12 of the A&C Act and was entitled to fees as per the IVth Schedule to the A&C Act or as otherwise agreed. The parties were to share the arbitrator's fee and costs equally. The Court explicitly stated that its order did not express any opinion on the merits of the case.

Key Issues

1. Whether the Court has the power to appoint a sole arbitrator when the respondent failed to appoint its arbitrator within the time stipulated in the contract, despite the petitioner invoking arbitration and approaching the Indian Council of Arbitration. Petitioner's contention: The petitioner argued that the respondent's failure to appoint an arbitrator within 30 days of receiving the invocation notice, as per Clause 45.1(c) of the SCC, entitled the petitioner to approach the ICA for the appointment of a sole arbitrator. The petitioner relied on the provisions of the Arbitration and Conciliation Act, 1996, and the contract clauses. Respondent's contention: The respondent did not explicitly contest the petitioner's right to seek appointment of an arbitrator. The judgment notes that after some hearing, both parties agreed that an independent sole arbitrator should be appointed to adjudicate the disputes.