Introduction:

In a recent ruling, the single bench of Chief Justice Sunita Agarwal at the High Court of Gujarat addressed a Section 11 application under the Arbitration and Conciliation Act. The petitioner, Poll Cont Associates, sought the appointment of an arbitrator against the backdrop of a dispute with Narmada Clean Tech Ltd. The respondent argued that the issuance of a ‘No Claim Certificate’ earlier made the dispute non-arbitrable. The High Court, emphasizing the narrow scope of its inquiry, affirmed the fundamental right to arbitration, leaving the decision on arbitrability to the arbitrator’s discretion.

Arguments:

Poll Cont Associates and Narmada Clean Tech Ltd., parties to an agreement with an arbitration clause, faced disputes, leading to a Section 8 application by the respondent. The petitioner, seeking an arbitrator’s appointment, was met with the respondent’s contention that a ‘No Claim Certificate’ rendered the dispute stale and non-arbitrable. The petitioner, represented by Mr. JF Mehta, challenged this stance, asserting the court’s limited role in determining arbitrability and emphasizing the jurisdiction of the arbitrator.

Court’s Judgement:

Chief Justice Sunita Agarwal’s bench invoked the ‘Eye of the Needle’ principle, asserting the court’s narrow jurisdiction under Section 11(6) of the Arbitration Act. The court’s primary inquiry focused on the existence of an arbitration agreement and privity of contract, leaving the determination of arbitrability to the arbitrator. The High Court rejected the respondent’s argument that the dispute had become non-arbitrable due to the ‘No Claim Certificate,’ emphasizing the importance of the arbitrator’s role in deciding arbitrability.