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Judgment
Aravind Kumar, J.—Heard the learned Advocates appearing for the parties.
Petitioner has filed this miscellaneous petition seeking for appointment of Arbitrator by invoking Section 11(5) and (6) of Arbitration and Conciliation Act, 1996, to resolve the dispute arising out of the Rate Contract No. 269 and 270/2006-07 dated 08.03.2007, Annexures - D and E, contending inter alia that on account of delayed payments interest was liable to be paid and petitioner has suffered damages due to loss of additional interest imposed by its bankers and as such, respondents are liable to pay said interest by way of damages.
Per contra, Sri. Sriranga, learned counsel appearing for respondents reiterating the contentions raised in the statement of objections would submit that parties are governed by the terms set out in the contract in question and as such, without admitting the liability of respondents, if any, payment of interest to be made to petitioner, would be as per contract only and if liability would be limited to the extent agreed under the terms and conditions of the said contracts and as such, petitioner cannot claim beyond what has been agreed to under the contract.
In support of his submission, he has relied upon unreported judgment of Hon''ble Apex Court in the case of M/S. KSS KSSIIPL CONSORTIUM, THRO. ITS CONSTITUTED ATTORNEY, MR.DEVENDRA KUMAR vs. M/S. GAIL (INDIA) LTD. in Arbitration Case (Civil) No. 38/2014 disposed of on 12.02.2015.
There cannot be any dispute with regard to the proposition that existence of a claim and its denial thereof would give raise to a dispute and if the parties have agreed to resolve such dispute through arbitration, as evidenced from the clause found in the said contract, then both the parties would be governed by such contract. In the instant case, the contracts in question would clearly indicate that there is an arbitration clause whereunder parties have resolved to settle their disputes or differences, by resorting to arbitration as per clause 4.0. It reads as under:
"4.0 Settlement of Disputes:
It is specifically agreed to by and between the parties that all the differences or disputes arising out of the Agreement or touching the subject matter of the Agreement shall be decided by the process of Settlement of disputes and Arbitration as specified in the General Terms and Conditions of the Contract and the provisions of the Indian Arbitration Act, 1940 shall apply and Jurisdictional Courts at Bangalore alone shall have exclusive jurisdiction over the same."
Though petitioner has raised a claim by way of damages, it is needless to state that arbitrator, who would arbitrate the dispute in question, would necessarily examine the entitlement of petitioner to claim such damages and whether such claim in tune with the terms agreed to under the contract while adjudicating such dispute. Hence, no opinion is expressed on the claim or rival contentions raised herein. In view of the undisputed fact that resolution of dispute between the parties is agreed to be resolved through arbitration, petition in question deserves to be allowed.
Learned Advocates have filed a joint memo, whereunder they have agreed for appointment of Sri. Kukkaje Ramakrishna Bhat, Retired District Judge, residing Opposite Mangalore Stone, Above Union Bank of India, 11th Cross, Malleshwaram, Bengaluru-560003, to be appointed as an Arbitrator and accordingly, he is hereby appointed. Learned Arbitrator shall enter upon reference and arbitrate dispute accordingly.
Registry to communicate the order to learned Arbitrator.
No order as to costs.