caselaws
Supreme Court of India
Intercontinental Hotels Group … vs Waterline Hotels Pvt. Ltd. on 25 January, 2022Author: Hon’Ble The Justice
Bench: Hon’Ble The Justice, A.S. Bopanna, Hon’Ble Ms. Kohli
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL ORIGINAL JURISDICTION
ARBITRATION PETITION (CIVIL) NO. 12 OF 2019
INTERCONTINENTAL HOTELS GROUP (INDIA) ….PETITIONERS
PVT. LTD. & ANR.
VERSUS
WATERLINE HOTELS PVT. LTD …. RESPONDENT
JUDGMENT
N.V. RAMANA, CJI.
1. This petition is filed under Section 11(6) r/w 11(12)(a) of the
Arbitration & Conciliation Act, 1996 for appointment of a sole
arbitrator.
2. The brief facts which are necessary for adjudication of this
application are that the Intercontinental Hotels Group (India) Pvt.
Ltd (Petitioner No.1) and Intercontinental Hotels Group (Asia
Signature Not Verified
Digitally signed by
SATISH KUMAR YADAV
Date: 2022.01.25
19:02:47 IST
Reason:
Pacific) Pvt Ltd. (Petitioner 2), are subsidiaries of Intercontinental
Hotels Group PLC (IHG Group), based out of India and Singapore
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respectively. The parent company (IHG Group) is a British multi
national hotel based out of Denham, United Kingdom.
3. The respondent is an Indian company engaged in hospitality
sector. The Respondent had agreed to run and operate a hotel by
name Holiday Inn & Suites Bengaluru, Whitefield.
4. The respondent entered into a Hotel Management Agreement
(HMA) with the petitioners for renovating the existing infrastructure
in accordance with the brand standards established by the IHG
group. The HMA elaborated on the rights and obligations of parties
from 17.09.2015 for initial ten years and further renewals were also
provided thereunder. The petitioners alleged that under the HMA,
the petitioners were required to make significant investments for
setting up the hotel in accordance with the brand standards. These
investments were to be recovered gradually from the profits made
by the hotel in due course.
5. The HMA mandated that for the renovation undertaken by the
petitioners, the respondent was contractually bound to pay the fee
to petitioner no. 1, known as incentive management fee, at the end
of every month. Further, Petitioner No.2 was entitled to license fee
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from the respondent for the use of brand and marks as well as an
agreed sum towards “System Fund Contributions”, “Technology
Service Fee” & “Technical Service Fee”.
6. The petitioners allege that the respondent failed to pay the
requisite fee which it was contractually bound to under the HMA
since early 2016. As of 12.10.2018, the respondent owed the
petitioners a sum amounting to USD 6,18,719, excluding interest
for the late payment as provided under Clause 21.3 of the HMA.
7. In any case, the respondent sent an email on 12.10.2018
terminating the HMA. In the aforesaid email, the respondent stated
that the hotel was rebranded as Miraya Hotels, and all guests
checking into the hotel after noon on 12.10.2018, were informed
that the management of the hotel had been handed over to Miraya.
On the same day, the petitioners replied to the aforesaid
termination letter contending that unilateral termination of the
HMA was not valid as there was no legal basis for the same.
8. The respondent failed to retract the email of 12.10.2018, and
the petitioners invoked Section 9 of the Arbitration Act seeking
interim relief before the High Court of Karnataka at Bengaluru in
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APIM No. 3/2018. The High Court, on 23.10.2018, passed an ad
interim order directing the respondent not to evict the petitioners
from the premises without due process of law until further orders.
However, the petitioners allege that the respondent has not been
sincere in complying with the order and has taken steps to frustrate
the aforesaid order.
9. As the settlement talks between the parties failed, and the
respondent remained in persistent breach of the HMA, the
petitioners were left with no option other than to invoke Arbitration
under clause 18.2 of HMA, which reads as under:
“Clause 18.2 Dispute Resolution
(a) All disputes, controversies or claims arising out of
or in connection with this Agreement and/or any matters
incidental hereto and/or the interpretation and/or
breach hereof, will first be discussed by the Owner and
the Manager with the objective of resolving such dispute,
controversy or claim in a fair, amicable and friendly
manner. If such efforts fail to bring a resolution within
ten (10) Business Days of receipt of a notice issued by
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one party to another seeking resolution, such disputes,
controversies or claims will be finally determined by
arbitration in accordance with the Arbitration Rules of
Singapore International Arbitration Centre (“SIAC”) for
the time being in force, which rules are deemed
incorporated by reference into this clause.
(b) The Tribunal shall consist of a sole Arbitrator.
However, in the event that the Parties are unable to agree
on the sole Arbitrator the tribunal shall consist of three
Arbitrators, one to be appointed by each of Manager and
Owner, and the third to be appointed by mutual
agreement of the two appointed Arbitrators. In the event
the Arbitrators appointed by the Manager and the Owner
fail to mutually agree on the third Arbitrator, such third
Arbitrator shall be appointed by a Competent Court of
Law in Bangalore. The Parties herein mutually agree to
exclude the applicability of rules of SIAC to this extent
(i.e., regarding appointment of third Arbitrator). The place
of arbitration will be SIAC in Bengaluru and the official
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language of the arbitration will be English. In reaching a
decision, the Arbitrators, will be bound by the terms and
provisions of this Agreement. The decision and award of
the Arbitrator will be final and binding and shall be
enforceable by the Indian Courts…”
10. In the Notice of Arbitration, the petitioners claimed the
following reliefs:
a. A declaration that:
i. The Respondent is in breach of the
Management Agreement dated 7th August
2015; and
ii. The Respondent has illegally and wrongfully
purported to terminate the Management
Agreement by its email dated 12th October
2018.
b. Direct the Respondent to pay to the
Claimants,
i. The outstanding dues of USD 618,719 as on
8 October 2018 owed to the Claimants under
the Management Agreement;
ii. Interest on the above outstanding amounts
from the dates the amounts became due until
the filing of this notice invoking arbitration, in
accordance with Clause 21.3 of the
Management Agreement;
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iii. Damages due to the wrongful
termination of the Management Agreement for
the remainder Term of the Management
Agreement which has as Initial Term of 10
years from 15 September 2015 with a potential
2 x 5 years of Renewal Term, in an amount to
be assessed later; and
iv. Such other future sums towards
damages and as may fall due under the
Management Agreement and as the Claimants
may put forth before the Hon’ble Tribunal in its
Statement of Case.
c. Pendente Lite and future interest on all
sums awarded to it at such rate as the
Tribunal may deem fit, in accordance with Rule
32.9 of the SIAC Rules and Arbitration &
Conciliation Act, 1996;
d. Award of costs from the Respondent and
interest on the costs awarded, till payment.
e. Any other prayer the Hon’ble Tribunal may
deem fit in the interest of justice.,”
11. The respondent is alleged to have replied to the aforesaid
Notice of Arbitration by stating that the said notice dated
21.01.2019 was not a notice, and consequently did not require a
reply.
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12. Accordingly, the petitioners communicated their intention to
invoke arbitration to the Singapore International Arbitration Centre
(SIAC). They also approached the SIAC for suggesting names of sole
arbitrators or to invoke the mechanism of appointing a three
member tribunal if the respondent does not agree on a single
name. SIAC further sent a notice dated 15.02.2019 to the
respondent for appointment of a suitable arbitrator. Interestingly,
the respondent replied to the notice sent by the SIAC stating that
the notice of arbitration dated 21.01.2019 was defective and was
not curable. In any case, the respondent alleges as under:
“Strictly without prejudice, we do not
accept IHG’s proposal to appoint any of the
3 Arbitrators named in its Notice, dated
08.02.2019, as a sole arbitrator. Nor do we
wish to propose and names of a sole
arbitrator. Further, there is no question of
proposing or agreeing to Arbitration by a
Tribunal of 3 Arbitrators for the same
reason. The reasons have been elaborately
narrated hereinabove and bear no
repetition.
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Clearly SIAC and its Associate Counsel
have turned a complete blind eye to the
legal position, facts of the case and
conduct of IHG and its Advocates. It would
not be out place to mention that, in the
given circumstances SIAC would not be
entitled to exclusion of liability under Rule
38, SIAC Rules.”
13. Aggrieved by the respondent’s denial to appoint a suitable
Arbitrator, the petitioners have filed this petition seeking
appointment of an Arbitrator.
14. When this matter was listed on 16.04.2019, this Court was
pleased to issue notice. Thereafter, the respondent entered
appearance and filed a counteraffidavit dated 24.07.2019,
pointing out that the purported HMA, which contains the
arbitration agreement, was an unstamped document. It notes that
this Court, in Garware Wall Ropes Ltd. v Coastal Marine
Constructions and Engineering Ltd., (2019) 9 SCC 209 has
earlier held that an agreement which is not duly stamped cannot
be relied on or acted upon unless the unstamped document is
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impounded, and the applicable stamp duty and penalty is assessed
and paid.
15. On 02.03.2020, this Court, at the request of the petitioners,
allowed four weeks to file an application. In line with the aforesaid
permission, the petitioners filed an application for permission to
file additional documents dated 23.06.2020 which reads inter alia
as under:
“ ………..
3. Without prejudice to the above, the Petitioner
No.1 has taken the necessary step to pay the
stamp duty applicable to the HMA. In
accordance with Section 2(6) of the Indian
Stamp Act, 1899, the stamping of the HMA
would be governed by the Karnataka Stamp Act,
1957 (“Karnataka Stamp Act”) because the HMA
was first executed in Bengaluru, the place of
performance is Bengaluru and the subject
matter of the HMA is situated in Bengaluru.
4. The Schedule of the Karnataka Stamp Act
enumerates different types of instruments that
attract stamp duty and the corresponding duty
that is payable. Article 5 of the Schedule
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provides the duty applicable to different types of
agreements, The HMA is a services agreement
which is not specifically provided for in Article
5, and therefore, it would be covered under the
residuary provisions, Article 5(j), “Agreement or
[its records or] Memorandum of an Agreement if
not otherwise provided for”. The corresponding
stamp duty is INR 200. In order to establish its
bona fide and to avert any argument regarding
the adequacy of the stamp duty paid, Petitioner
No. 1 has also paid the maximum penalty i.e.,
tentimes that duty amounting to INR 2,000 in
accordance with the proviso to Section 34 of the
Karnataka Stamp Act.
5. The Petitioners further submit that since they
have paid the requisite stamp duty along with
the maximum penalty prescribed under the
Karnataka Stamp Act, this Hon’ble Court may
proceed to appoint a sole Arbitrator who has the
jurisdiction to deal with all disputes that arise
between the parties.”
16. The respondent, while objecting to the aforesaid application
filed by the petitioners, stated as under:
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“4. I state that at the time of hearing of the
above cited Petition on the 02.03.2020, the
learned Sr. Counsel appearing for the Petitioner
had tendered a Letter dated 28.02.2020
annexing therewith a single eStamp paper
bearing Unique Doc. Reference No.
SUBINKAKABACSL0850557522508599R dated
29.07.2020 for Rs.2,200/ classifying the HMA
as “Bond” under Article 12 of the Schedule to
the Karnataka Stamp Act, 1957 and the
Consideration Prices as Zero….
5. That this Hon’ble Court, had by its Order
dated 02.03.2020 directed the Petitioners to file
the said single eStamp paper, dated
29.07.2019 along with a proper Application.
6. I state that, the Petitioners have not filed the
said single eStamp Paper, dated 29.07.2019,
classifying the HMA as “Bond”. Instead,
purportedly in furtherance of this Hon’ble
Court’s Order dated 02.03.2020, the Petitioners
have filed a completely different set of 11 e
Stamp Papers of Rs.200/ each all dated
10.06.2020 this time classifying the agreement
under Article 5(j) of the Schedule to the
Karnataka Stamp Act, 1957 and annexing the
HMA dated 07.08.2015 therewith, under the
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above cited Application seeking permission to
file Additional Documents being I.A D. No.
60764 of 2020.
7. I state that it is not true that, vide this
Hon’ble Court’s Order, dated 02.03.2020, the
Petitioners were granted permission to file the
11 eStamp Papers, for Rs.200/ each, all
dated 10.06.2020, that have been filed along
with the above cited Application seeking
permission to file Additional Documents being
I.A D. No. 60764 of 2020.
8. I submit that the Petitioners have not paid
the proper Stamp Duty and penalty under the
Karnataka Stamp Act, 1957 nor has the
procedure of adjudication of proper stamp duty
and penalty payable been followed by the
Petitioner as per law. The Petitioners have, in
fact, arrogated to themselves the power of
adjudication under the Karnataka Stamp Act,
1957.
9. I state that there is no procedure whereby a
party self adjudicates and self certifies the
proper stamp duty and the penalty payable on
a Document as sought to be done twice by the
Petitioners as under:
SELF ADJUDICATION BY THE PETITIONERS WITH
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THE MAXIMUM PENALTY OF 10 TIMES
29.07.2019 10.06.2020
Single eStamp paper 11 eStamp Papers
for Rs.2,200/ for Rs.200/ each
Description of Doc. Description of Doc.
Art 12 Bond Art 5(j) Agreement
(In any other cases)
Property Description Property
Description
Hotel Management Agreement
Agreement
Consideration Price Consideration Price
(Rs.) 0 (Rs.) 0
(Zero) (Zero)
17. We have heard learned counsel for the parties and perused
the documents available on record.
18. At the outset, we need to state that this Court’s jurisdiction to
adjudicate issues at the preappointment stage has been the
subject matter of numerous cases before this Court as well as High
Courts. The initial interpretation provided by this Court to examine
issues extensively, was recognized as being against the pro
arbitration stance envisaged by the 1996 Act. Case by case, Courts
restricted themselves in occupying the space provided for the
arbitrators, in line with party autonomy that has been reiterated by
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this Court in Vidya Drolia v. Durga Trading Corporation, (2021)
2 SCC 1, which clearly expounds that Courts had very limited
jurisdiction under Section 11(6) of the Act. Courts are to take a
‘prima facie’ view, as explained therein, on issues relating to
existence of the arbitration agreement. Usually, issues of
arbitrability/validity are matters to be adjudicated upon by
arbitrators. The only narrow exception carved out was that Courts
could adjudicate to ‘cut the deadwood’. Ultimately the Court held
that the watch word for the Courts is ‘when in doubt, do refer’.
This Court concluded as under:
“225. From a study of the above precedents,
the following conclusion, with respect to
adjudication of subjectmatter arbitrability
Under Section 8 or 11 of the Act, are pertinent:
225.1 In line with the categories laid down by
the earlier judgment of Boghara Polyfab
[National Insurance Co. Ltd. v. Boghara
Polyfab (P) Ltd., (2009) 1 SCC 267] the Courts
were examining ‘subjectmatter arbitrability’ at
the prearbitral stage, prior to the 2015
amendment.
225.2 Post the 2015 amendment, judicial
interference at the reference stage has been
substantially curtailed.
225.3 Although subject matter arbitrability
and public policy objections are provided
separately Under Section 34 of the Act, the
Courts herein have understood the same to be
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interchangeable under the Act. Further,
subject matter arbitrability is interlinked with
inrem rights.
225.4 There are special classes of rights and
privileges, which enure to the benefit of a
citizen, by virtue of constitutional or legislative
instrument, which may affect the arbitrability
of a subjectmatter.”
Following is the opinion of one of us (N. V. Ramana, J., as His
Lordship then was):
“244. Before we part, the conclusions reached,
with respect to question No. 1, are:
244.1 Sections 8 and 11 of the Act have the
same ambit with respect to judicial
interference.
244.2 Usually, subject matter arbitrability
cannot be decided at the stage of Sections 8 or
11 of the Act, unless it’s a clear case of
deadwood.
244.3 The Court, Under Sections 8 and 11,
has to refer a matter to arbitration or to
appoint an arbitrator, as the case may be,
unless a party has established a prima facie
(summary findings) case of nonexistence of
valid arbitration agreement, by summarily
portraying a strong case that he is entitled to
such a finding.
244.4 The Court should refer a matter if the
validity of the arbitration agreement cannot be
determined on a prima facie basis, as laid
down above, i.e., ‘when in doubt, do refer’.
244.5 The scope of the Court to examine the
prima facie validity of an arbitration agreement
includes only:
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244.5.1 Whether the arbitration agreement
was in writing? or
244.5.2 Whether the arbitration agreement
was contained in exchange of letters,
telecommunication etc?
244.5.3 Whether the core contractual
ingredients qua the arbitration agreement
were fulfilled?
244.5.4 On rare occasions, whether the
subjectmatter of dispute is arbitrable?”
19. While holding as above, this Court by majority opinion
speaking through Justice Sanjiv Khanna held as under:
“147.1. In Garware Wall Ropes Ltd. [Garware
Wall Ropes Ltd. v. Coastal Marine
Constructions & Engg. Ltd., (2019) 9 SCC 209 :
(2019) 4 SCC (Civ) 324] , this Court had
examined the question of stamp duty in an
underlying contract with an arbitration clause
and in the context had drawn a distinction
between the first and second part of Section
7(2) of the Arbitration Act, albeit the
observations made and quoted above with
reference to “existence” and “validity” of the
arbitration agreement being apposite and
extremely important, we would repeat the
same by reproducing para 29 thereof : (SCC p. 238)
“29. This judgment in Hyundai Engg.
case [United India Insurance Co.
Ltd. v. Hyundai Engg. & Construction Co. Ltd.,
(2018) 17 SCC 607 : (2019) 2 SCC (Civ) 530] is
important in that what was specifically under
consideration was an arbitration clause which
would get activated only if an insurer admits
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or accepts liability. Since on facts it was found
that the insurer repudiated the claim, though
an arbitration clause did “exist”, so to speak,
in the policy, it would not exist in law, as was
held in that judgment, when one important
fact is introduced, namely, that the insurer
has not admitted or accepted liability.
Likewise, in the facts of the present case, it is
clear that the arbitration clause that is
contained in the subcontract would not “exist”
as a matter of law until the subcontract is
duly stamped, as has been held by us above.
The argument that Section 11(6A) deals with
“existence”, as opposed to Section 8, Section
16 and Section 45, which deal with “validity” of
an arbitration agreement is answered by this
Court’s understanding of the expression
“existence” in Hyundai Engg. case [United
India Insurance Co. Ltd. v. Hyundai Engg. &
Construction Co. Ltd., (2018) 17 SCC 607 :
(2019) 2 SCC (Civ) 530] , as followed by us.”
Existence and validity are intertwined, and
arbitration agreement does not exist if it is
illegal or does not satisfy mandatory legal
requirements. Invalid agreement is no
agreement.”
20. In any case, again in N.N. Global Mercantile Private
Limited v. Indo Unique Flame Limited, (2021) 4 SCC 379, this
Court doubted the above proposition as held in Garware Wall
Ropes (supra), and was of the opinion that the utility of the
doctrine of separability overrides the concern under the respective
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Stamp Acts. Any concerns of nonstamping or under stamping
would not affect the validity of the arbitration agreement. However,
this Court considered it appropriate to refer the issue for
authoritative settlement by a Constitution Bench in the light of
Vidya Drolia (supra), citing the ratio in Garware Wall Ropes
(supra). The relevant observations made in N.N. Global (supra)
read as under:
“56. We are of the considered view that the
finding in SMS Tea Estates [SMS Tea Estates
(P) Ltd. v. Chandmari Tea Co. (P) Ltd., (2011) 14
SCC 66] and Garware [Garware Wall Ropes
Ltd. v. Coastal Marine Constructions & Engg.
Ltd., (2019) 9 SCC 209] that the nonpayment
of stamp duty on the commercial contract
would invalidate even the arbitration
agreement, and render it nonexistent in law,
and unenforceable, is not the correct position
in law.
57. In view of the finding in paras 146 and
147 of the judgment in Vidya Drolia [Vidya
Drolia v. Durga Trading Corpn., (2021) 2 SCC 1
by a coordinate Bench, which has affirmed the
judgment in Garware [Garware Wall Ropes
Ltd. v. Coastal Marine Constructions & Engg.
Ltd., (2019) 9 SCC 209], the aforesaid issue is
required to be authoritatively settled by a
Constitution bench of this Court.
58. We consider it appropriate to refer the
following issue, to be authoritatively settled by
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a Constitution Bench of five Judges of this
Court:
“Whether the statutory bar contained in
Section 35 of the Indian Stamp Act, 1899
applicable to instruments chargeable to Stamp
Duty under Section 3 read with the Schedule
to the Act, would also render the arbitration
agreement contained in such an instrument,
which is not chargeable to payment of stamp
duty, as being nonexistent, unenforceable, or
invalid, pending payment of stamp duty on the
substantive contract/instrument?”
59. In light of the same, the Registry may
place this matter before the Hon’ble Chief
Justice of India for appropriate
orders/directions.”
21. The reasoning for the above was provided in the captioned
judgment as follows:
“24. The arbitration agreement contained in
the Work Order is independent and distinct
from the underlying commercial contract. The
arbitration agreement is an agreement which
provides the mode of dispute resolution.
Section 3 of the Maharashtra Stamp Act does
not subject an arbitration agreement to
payment of Stamp Duty, unlike various other
agreements enlisted in the Schedule to the Act.
This is for the obvious reason that an
arbitration agreement is an agreement to
resolve disputes arising out of a commercial
agreement, through the mode of arbitration.
On the basis of the doctrine of separability, the
arbitration agreement being a separate and
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distinct agreement from the underlying
commercial contract, would survive
independent of the substantive contract. The
arbitration agreement would not be rendered
invalid, unenforceable or nonexistent, even if
the substantive contract is not admissible in
evidence, or cannot be acted upon on account
of nonpayment of Stamp Duty.”
22. Although we agree that there is a need to constitute a larger
Bench to settle the jurisprudence, we are also cognizant of time
sensitivity when dealing with arbitration issues. All these matters
are still at a preappointment stage, and we cannot leave them
hanging until the larger Bench settles the issue. In view of the
same, this Court – until the larger Bench decides on the interplay
between Sections 11(6) and 16 – should ensure that arbitrations
are carried on, unless the issue before the Court patently indicates
existence of deadwood.
23. This brings us to the only issue at hand: whether the issue of
insufficient stamping raised by the respondent is deadwood and
clearly indicative of an unworkable arbitration agreement, or there
are deeper issues which can be resolved at a later stage. The
counsel for the petitioners has sought to draw our attention to
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Clause 22(1)(b) of the HMA, to contend that the respondent has
presented a warranty to ensure the said HMA would be valid and
legally enforceable. Clause 22.1 (b) of the HMA reads as follows:
“22.1. Owner represents and warrants to
Manager upon execution of this Agreement and
again on the Commencement Date that:
…
b) it has obtained or shall obtain (with Manager’s
assistance as it is reasonably able to provide) all
necessary governmental permissions, licenses
and permits (including but not limited
construction, occupancy, liquor, bar, restaurant,
sign and hotel accommodation licenses) to enable
Manager to operate the Hotel in accordance with
the Brand Standards and to ensure this
Agreement is fully valid and enforceable in the
Country.”
24. Having perused Clause 22.1, it is necessary to note that the
respondent is under an obligation to ensure that the agreement
would be legally valid in India. If such an obligation was
undertaken by the respondent, the extent to which the petitioners
can rely on the respondent’s warranty, is clearly a debatable issue.
Further, it is also a matter of adjudication whether the respondent
could have raised the issue of validity of the arbitration
agreement/substantive contract in view of the warranty. This
aspect clearly mandates that the aforesaid issue is not deadwood.
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The issues whether the respondent is estopped from raising the
contention of unenforceability of the HMA or the issue whether the
HMA is insufficiently or incorrectly stamped, can be finally decided
at a later stage.
25. Moreover, the petitioners have reiterated that without
prejudice, they have paid the required stamp duty, including the
penalty that may be accruable and sought appointment of a sole
arbitrator in light of the same. On the contrary, the respondent, in
rebuttal to the payment of stamp duty, has challenged the same,
contending that payment of stamp duty has been wrongly classified
and stamp duty has been paid against Article 5(j) under the
schedule of the Karnataka Stamp Act, 1957, which is erroneous.
Therefore, the respondent contends that the HMA has not been
properly stamped.
26. Upon reading Vidya Drolia (supra), the issue of ‘existence’
and/or ‘validity’ of the arbitration clause, would not be needed to
be looked into herein, as payment of stamp duty, sufficient or
otherwise, has taken place herein. In order to ascertain whether
adequate stamp duty has been paid in terms of the Karnataka
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Stamp Act, this Court needs to examine the nature of the
substantive agreement, the nature of the arbitration agreement,
and whether a separate stamp fee would be payable for the
arbitration agreement at all. It may be noted that the petitioners,
have themselves attempted to selfadjudicate the required stamp
duty and have paid, on 29.07.19, a stamp duty of Rs 2,200/,
describing the HMA as a “bond”. On 10.06.2020, the petitioners
further purchased 11 estamps for Rs. 200/ each, describing the
HMA as an ‘agreement’ under article 5(j). Therefore, it falls upon
the Court, under the stamp act to review the nature of the
agreement in order to ascertain the stamp duty payable. From the
above it is clear, that stamp duty has been paid, whether it be
insufficient or appropriate is a question that maybe answered at a
later stage as this court cannot review or go into this aspect under
Section 11(6). If it was a question of complete non stamping, then
this court, might have had an occasion to examine the concern
raised in N. N. Global (supra), however, this case, is not one such
scenario.
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27. Therefore, we deem it appropriate for this matter to be
referred to arbitration, in terms of Clause 18.2 of the arbitration
agreement.
28. Accordingly, we appoint Mr. Justice A.V. Chandrashekara, a
former Judge of the High Court of Karnataka as a sole arbitrator to
adjudicate the issues. The parties are directed to take steps to
convey this order to the SIAC to proceed in terms of the SIAC rules.
29. The arbitration petition is allowed in the above terms.
…………………………………….CJI.
(N.V. RAMANA)
……………………………………….J.
(SURYA KANT)
……………………………………….J.
(HIMA KOHLI)
NEW DELHI;
JANUARY 25, 2022
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