Oyo Workspaces INDIA PVT. LTD vs. Mountblue Technologies PVT. LTD.

Facts

The petitioner, OYO Workspaces India Pvt. Ltd., filed a petition under Section 11 of the Arbitration and Conciliation Act, 1996, seeking the appointment of a Sole Arbitrator. The dispute arose from a Membership Agreement dated December 9, 2019, between the petitioner and the respondent, Mountblue Technologies Pvt. Ltd. The agreement stipulated a monthly membership fee of Rs. 8,40,000/- exclusive of GST for a period of one year, from December 16, 2019, to May 15, 2021, for the use of a workspace. The petitioner alleged that the respondent failed to pay Rs. 78,49,180/- for the utilization of the property and for the remainder of the lock-in term. Consequently, the petitioner invoked the arbitration clause in the agreement.

Held

The Court held that the parties had clearly intended for their disagreements to be resolved through arbitration, as stipulated in their Membership Agreement. The respondent, while opposing the petitioner's averments, conceded that the dispute was arbitral in nature and did not object to the appointment of a Sole Arbitrator. Therefore, in light of the parties' mutual intent and the respondent's concession, the Court found it appropriate to refer the disputes to arbitration. Mrs. Madhurima Mridul, Advocate, was appointed as the sole arbitrator to adjudicate the disputes arising under the Membership Agreement. The arbitrator was directed to ensure compliance with Section 12(1) of the Arbitration and Conciliation Act, 1996, and to be paid fees as prescribed under the Fourth Schedule of the Act. The parties were directed to appear before the arbitrator within 10 days. All contentions of the parties were expressly kept open.

Key Issues

1. Whether the Court has the power to appoint a Sole Arbitrator under Section 11 of the Arbitration and Conciliation Act, 1996, given the existence of an arbitration clause in the Membership Agreement dated December 9, 2019. (Question of law) Contentions: Petitioner: Argued that a dispute has arisen from the Membership Agreement and that the arbitration clause clearly mandates resolution through arbitration. Therefore, the Court should appoint a Sole Arbitrator as per the petitioner's request. Respondent: Vehemently opposed the averments made in the petition but fairly conceded that the dispute is arbitral in nature. The respondent had no objection to the Court appointing a Sole Arbitrator for the adjudication of the disputes.