Alliance Construction vs. Atmastco Limited

Facts

The applicant, M/s Alliance Construction, a proprietary concern based in Kolkata, entered into a contract with the respondent, Atmastco Limited, a company registered in Bhilai, Chhattisgarh, for civil work on a 33 MVA SAF Project in Odisha. The contract, initially valued at Rs.12,07,37,500/- including GST, was revised to Rs.11,45,09,850/-. The project was to be completed by April 30, 2023. The applicant claims substantial progress was made, completing over 99% of the work, but faced impediments due to the respondent's alleged failures in approvals, bill certification, and payments, leading to outstanding amounts and damages. The applicant served legal notices and invoked the arbitration clause in the Letter of Intent, with the seat of arbitration designated as Durg, Chhattisgarh. The respondent acknowledged the arbitration request but agreed to the appointment of an arbitrator.

Held

The Court held that it had jurisdiction to entertain the application for the appointment of an arbitrator, as the respondent's registered office and the agreed seat of arbitration were located within its territorial jurisdiction. Regarding the second issue, the Court found that the parties had reached a consensus on the appointment of a sole arbitrator. Both parties agreed that any retired Judge of the High Court could be appointed, and specifically proposed Hon’ble Mr. Justice N.K. Agrawal. The Court accepted this consensus and appointed Hon’ble Mr. Justice N.K. Agrawal as the Sole Arbitrator to resolve the disputes between the parties. The remuneration of the Arbitrator was to be settled by mutual consent. The arbitration request petition was allowed.

Key Issues

1. Whether this Hon'ble Court has jurisdiction to entertain the application for appointment of an arbitrator, considering the respondent's registered office and the agreed seat of arbitration are within its territorial jurisdiction? The applicant argued that jurisdiction lies with this Court due to the respondent's registered office and the arbitration seat being in Chhattisgarh. The respondent did not contest this jurisdiction. 2. Whether an arbitrator should be appointed to resolve the disputes between the parties, given the applicant's invocation of the arbitration clause and the respondent's failure to appoint an arbitrator or engage in conciliation within the stipulated period? The applicant contended that the respondent failed to respond to the arbitration notice and initiate conciliation, necessitating the Court's intervention. The respondent stated they would not object to an arbitrator being appointed by the Court.