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Jra Infratech Vs. Engineering Projects (India) Limited - (High Court of Delhi) (11 Sep 2023)

When the arbitration agreement itself is void, Court would decline to refer the parties to arbitration despite the existence of an arbitration clause



The present petition under Section 11 of the Arbitration and Conciliation Act, 1996 seeks appointment of an arbitrator for adjudication of disputes which have arisen between the parties in relation to the Agreement dated 14th December, 2021.

A closer scrutiny of the facts of the present case makes it evident that, the disputes in the present case cannot be said to be non-arbitrable. Merely because after the filing of the present petition, the Respondent chose to file a criminal complaint against the petitioner alleging therein that the Petitioner had submitted a forged/fake experience certificate, cannot by itself lead to a conclusion that any fraud or forgery was committed by the petitioner. It is only when the Court comes to a definite conclusion that the arbitration agreement itself is void, that the Court should decline to refer the parties to arbitration despite the existence of an arbitration clause. Even otherwise, the disputes between the parties are purely private in nature and would not fall within the realm of disputes which would affect public interest. The Petitioner is, therefore, justified in urging that in the facts of the present case, the learned Arbitrator would be competent to decide the question regarding the arbitrability of the disputes as well.

There is yet another reason that compels present Court to hold that, present is a fit case where the parties must be referred to arbitration. Upon the petitioner's request, the Respondent itself had appointed a sole Arbitrator for adjudication of the very same disputes in respect whereof the present petition has been filed.

Since it cannot be said at this stage that the agreement itself is vitiated by fraud, the question as to whether the disputes raised by the Petitioner are arbitrable should be left to the wisdom of the learned Arbitrator who will be free to decide the same after taking into account the evidence led by the parties. Petition allowed.


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