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Jyotsana Sinha vs. Snigdha Paper And Packaging LLP And Ors. - (High Court of Delhi) (06 Feb 2023)

As the existence of the Arbitration Agreement and due invocation thereof are not denied, it is not for present Court to enter into the merits of the claims raised by the parties



Present petition has been filed under Section 11 of the Arbitration and Conciliation Act, 1996 seeking appointment of an Arbitrator for adjudicating the disputes that have arisen between the parties in relation to the LLP Agreement dated 17th August, 2017 executed between the parties. Disputes having arisen between the parties, the Petitioner invoked the Arbitration Agreement vide notice. In response, the respondent vide reply refused the appointment of an Arbitrator. The Petitioner has filed the present petition thereafter. The existence of the Arbitration Agreement in the LLP Agreement is not denied by the Respondent.

As the existence of the Arbitration Agreement and due invocation thereof are not denied by the respondent, following the judgment of the Supreme Court in Vidya Drolia and Others v. Durga Trading Corporation, it is not for this Court to enter into the merits of the claims raised by the parties. It shall always be open to the Respondent in such arbitration proceedings to contend that the transaction for which the suit has been filed by the petitioner is also related to or shall have an effect on the claim raised by the petitioner before the learned Sole Arbitrator.

The learned counsels for the parties at this stage request that they be referred to the Delhi International Arbitration Centre (in short 'DIAC') for appointment of an Arbitrator. They further request that a Chartered Accountant be appointed as an Arbitrator as the dispute between them is in relation to accounts.

Accordingly, with the consent and on the request of the parties, the parties are referred to the DIAC, where they shall appear before the learned Coordinator. The DIAC shall appoint a Chartered Accountant from its panel as a Sole Arbitrator. The fee and the procedure of arbitration shall be governed by the DIAC Rules. Petition disposed off.


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