Indiacan Education Private Limited vs Ministry Of Rural Development & Ors.

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* IN THE HIGH COURT OF DELHI AT NEW DELHI
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Reserved on: 28 April, 2026
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Pronounced on: 02 July, 2026

+ ARB.P. 605/2025 & I.A. 11842/2026
INDIACAN EDUCATION PRIVATE LIMITED .....Petitioner
Through: Mr. Anil Airi, Sr. Adv. with Mr.
Vishal Tyagi, Ms. Jasmin Sokhi, Mr.
Harsh Gautam, Ms. Sadhna Sharma,
Mr. Sumant Nayak, Ms. Shraddha
and Mr. Vedant Goel, Advs.
M: 9582949895
Email: [email protected]
versus

MINISTRY OF RURAL DEVELOPMENT & ORS. .....Respondents
Through: Mr. Premtosh K. Mishra, CGSC with
Mr. Shrey Sharma, Mr. Anubhav
Upadhyay and Mr. Arpit Bamal,
Advocates for respondent no. 1.
(M): 9818727744
Email: [email protected]
Mr. Chetanya Puri, SPC with Ms.
Vidhi Gupta, Ms. Nisha Puri and Mr.
Rishab Jain, Advocates for
respondent no. 2.
(M): 9810884689
Email: [email protected]
Mr. Parth Awasthi and Ms. Simran
Sharma, Advs. for R-3
(M): 9903472058
Email: [email protected]

CORAM:
HON'BLE MS. JUSTICE MINI PUSHKARNA
Signature Not Verified
Digitally Signed
By:HARIOM SHARMA
Signing Date:02.07.2026
16:40:00
ARB.P. 605/2025 Page 1 of 46

JUDGMENT
MINI PUSHKARNA, J.
INTRODUCTION
1. The present petition has been filed under Section 11(6) of the
Arbitration and Conciliation Act, 1996 (“Arbitration Act”) , seeking
appointment of a Sole Arbitrator, for adjudication of disputes in accordance
with Article VIII, Clause 14 of the Memorandum of Understanding dated
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02 April, 2016 (“MoU”) , entered into between the petitioner and
respondent no. 2.
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2. This Court notes that the petitioner vide order dated 07 April, 2025
has conceded to the fact that the MoU was executed in Hyderabad, however,
the petition in paragraph 44 incorrectly shows the same as New Delhi. The
said order further records the admission of the petitioner that respondent no.
1 has not executed the MoU.
3. In order to rectify the aforesaid discrepancy in the petition with
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respect to the place of execution of the MoU, this Court on 17 September,
2025 allowed the I.A. 18292/2025 , seeking amendment of the present
petition, and thereby, took the amended petition on record, as per which, the
place of execution of the MoU is Hyderabad.
BRIEF FACTS
4. The relevant facts, necessary for adjudication of the present petition,
are as under:
4.1. Respondent no. 1, i.e., Ministry of Rural Development, Government
of India (“MoRD”) , to improve the educational standards and promote skill
development and growth of rural India, introduces various schemes and
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By:HARIOM SHARMA
Signing Date:02.07.2026
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ARB.P. 605/2025 Page 2 of 46

projects. For this purpose, respondent no. 1, with the aid of Skill
Development Corporations, appoints various Project Implementation
Agencies for assignment of such projects.
4.2. Under the aegis of one such scheme, namely, Deen Dayal Upadhyaya
Grameen Kaushalya Yojna (“DDU scheme”) , respondent no. 1 had
appointed the petitioner, who is engaged in the business of providing
educational services, as a Project Implementation Agency for a tenure of one
year, thereby, targeting 459 beneficiaries in the districts of Jammu and
Srinagar, Union Territory of Jammu and Kashmir. The petitioner was
appointed as a Project Implementation Agency vide Sanction Letter dated
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11 February, 2016, for the purposes of capacity building and skill
development in rural youths in the Union Territory of Jammu and Kashmir
(“Project”) .
4.3. The entire cost of the aforesaid Project was to the tune of Rs.
1,34,17,488/-, which was to be released by respondent no. 1 to respondent
no. 2, i.e., National Institute of Rural Development, Hyderabad (“NIRD”) ,
in three instalments in the ratio of 25:50:25. Thereafter, respondent no. 2
was to disburse the said amount to the petitioner. The first instalment was to
be released along with the sanction of the Project, whereas, the second and
third instalments were to be released upon achieving the corresponding
milestones, as per the MoU. Consequently, respondent no. 1 had released a
sum of Rs. 33,54,372/-, amounting to 25% share of the total cost of the
Project.
4.4. Post sanctioning of the Project, the petitioner and respondent no. 2
duly signed and executed the MoU in Hyderabad, however, the stamp paper
Signature Not Verified
Digitally Signed
By:HARIOM SHARMA
Signing Date:02.07.2026
16:40:00
ARB.P. 605/2025 Page 3 of 46

affixed to the said MoU was generated in New Delhi.
4.5. In pursuance of the said Sanction Letter and the MoU, the petitioner
commenced its operation in both Srinagar and Jammu districts. Thereafter,
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respondent no. 1 issued a revised Sanction Letter dated 19 December, 2016
to respondent no. 2, whereby, the aforesaid Project was revised for a period
of 03 years, instead of 01 year, and targeting 290 beneficiaries. Further, the
revised cost of the Project came to the tune of Rs. 1,40,16,985/-, which was
to be incurred by respondent no. 1.
4.6. Upon completion of the requisite milestones, the petitioner duly
apprised respondent nos. 1 and 2, through various representations, regarding
its eligibility to claim second instalment amounting to Rs. 70,08,492/-.
4.7. As part of its transition from “Year Plan” to “Action Plan”,
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respondent no. 1, by way of the order dated 27 November, 2018,
transferred the administration and coordination of the Project being
undertaken by the petitioner, from respondent no. 2 in favor of respondent
no. 3, i.e., Himayat Mission Management Unit of Jammu and Kashmir State
Rural Livelihood Mission. The annexure to the said order, also stated that a
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recommendation for release of second instalment was sent to MoRD on 01
May, 2018.
4.8. Subsequently, the petitioner completed the Project and accordingly,
submitted the Project Closure Report, along with other requisite documents,
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vide its communication dated 13 May, 2020.
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4.9. By way of its written representation dated 15 May, 2020 addressed
to respondent no. 3, the petitioner further requested for disbursal of its dues.
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In response, respondent no. 3, vide the E-mail dated 18 May, 2020, stated
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By:HARIOM SHARMA
Signing Date:02.07.2026
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ARB.P. 605/2025 Page 4 of 46

that the release of funds was under process and a communication with
respect to signing of the tripartite MoU has already been sent to respondent
no. 2.
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4.10. Thereafter, respondent no. 1 by way of letter dated 06 January, 2021
further clarified that post transfer of the Project to respondent no. 3, only an
addendum to the MoU was required to be executed, instead of a tripartite
MoU, as proposed by respondent no. 3.
4.11. Since the petitioner did not receive the payments towards the Project,
the petitioner sent various representations and follow-ups to the respondents.
Further, upon not receiving the addendum to the MoU from the respondents,
the petitioner itself had shared a draft addendum to the MoU, for the
purposes of validation and execution. Consequently, respondent no. 3 vide
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its communication dated 01 September, 2021, stated that they have already
taken up the matter with respondent no. 2 for completion of procedural
formalities, as stipulated by respondent no. 1, and the same is awaited from
their side.
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4.12. Additionally, respondent no. 2, through its E-mails dated 25
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October, 2021 and 14 December, 2021, again directed the petitioner to
submit the Project Closure Report for onward submission to respondent no.
1, and other financial documents for audit and closure of the Project.
Pursuant thereto, the relevant documents were accordingly supplied to
respondent no. 2 by the petitioner.
4.13. On account of the non-payment of dues, the petitioner vide notice
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dated 01 April, 2022, invoked Article VIII of the MoU and requested
respondent no. 2 to engage in mutual consultation in respect of the dispute in
Signature Not Verified
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By:HARIOM SHARMA
Signing Date:02.07.2026
16:40:00
ARB.P. 605/2025 Page 5 of 46

terms of Clause 14.1 of Article VIII of the MoU. In response, respondent no.
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2 shared an E-mail dated 04 August, 2022, stating that financial audit will
be completed for closure of the Project, subject to necessary verifications of
the candidates.

4.14. Despite the follow-ups by the petitioner and assurances from the
respondents with respect to payment of dues, no proper steps were taken by
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the respondents. Therefore, the petitioner issued a notice dated 05
February, 2025 to the respondents, inter alia , seeking to arbitrate the present
dispute on account of non-payment of the dues to the tune of Rs.
1,66,37,275/-.
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4.15. Respondent no. 2 addressed an E-mail dated 25 February, 2025
stating that pursuant to the transition of the Project to respondent no. 3, the
second instalment had not been released in favour of the petitioner. While,
respondent no. 1 failed to respond to the notice invoking arbitration,
respondent nos. 2 and 3 issued their respective communications, wherein,
they failed to nominate/agree for initiation of arbitration proceedings.
4.16. Thus, dispute has arisen between the parties and the present petition
came to be filed.
SUBMISSIONS ON BEHALF OF THE PARTIES:
5. The following contentions have been raised on behalf of the
petitioner:
5.1. Respondent no. 1 is a necessary and proper party to the arbitral
proceedings sought to be initiated by the petitioner herein, since respondent
no. 2 is merely a pass-through agency acting on behalf of respondent no. 1.
5.2. The DDU scheme is an initiative under respondent no. 1 and the
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By:HARIOM SHARMA
Signing Date:02.07.2026
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ARB.P. 605/2025 Page 6 of 46

Projects thereunder are funded by the Central and the State Governments.
Further, the Empowered Committee, belonging to respondent no. 1, had
approved the proposal of the petitioner. The total cost of the Project was to
be released in three instalments in the ratio of 25:50:25 to respondent no. 2
for onward transfer to the petitioner, who was acting as a Project
Implementation Agency.
5.3. Thus, respondent no. 1 was the sanctioning authority of the Project
and also the fund disbursing authority. The same is clear from Clause 2 of
the MoU, wherein, it has been stated that respondent no. 2 was the
Programme Monitoring Agency and would only be able to release funds to
the petitioner upon release of the same from respondent no. 1.
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5.4. The Sanction Orders dated 11 February, 2016 and 19 December,
2016 were issued by respondent no. 1 in furtherance of the execution of the
Project, and the same, thus, forms part of the MoU executed between
respondent no. 2 and the petitioner. Even as per Clause 2.2 of the Sanction
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Order dated 11 February, 2016, respondent no. 1 herein was to release the
funds for the project as a grant-in-aid to respondent no. 2. Further, Clause
5.6 of the MoU stated that the release of the funds was subject to the internal
audit of respondent no. 1.
5.5. Clause 8 of the MoU also stated that respondent no. 1 could terminate
the MoU, and put the petitioner under blacklist by way of issuance of notice
of termination.
5.6. Respondent no. 1 exercised administrative control over the Project, as
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is evident from the communication/order dated 27 November, 2018,
whereby, respondent no. 1 transferred the Project from respondent no. 2 to
Signature Not Verified
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By:HARIOM SHARMA
Signing Date:02.07.2026
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ARB.P. 605/2025 Page 7 of 46

respondent no. 3. Further, serial no. 3 to the said order, acknowledged that
the recommendation for release of second instalment had been sent to
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respondent no. 1 on 01 May, 2018. Therefore, without respondent no. 1’s
involvement in the proposed arbitral proceedings, crucial questions
regarding the delay in disbursal of payments cannot be properly adjudicated,
on account of the fact that all administrative and effective control towards
the Project was being conducted by respondent no. 1, while respondent no. 2
was merely a coordinating agency.
5.7. The objection of the respondent no. 1 that they have no authority to
take any further action with regard to the Project once the same stood
transferred from “Year Plan” to “Action Plan”, are precisely the questions
which can be dealt with by the Arbitral Tribunal. Additionally, these issues
cannot come under the scope of enquiry at the stage of Section 11 of the
Arbitration Act, as it would necessitate detailed examination by the Arbitral
Tribunal.
5.8. The participation of respondent no. 1, owing to its privity and access
to documents, is necessary in the arbitration proceedings sought to be
commenced by the present petition.
5.9. Further, respondent no. 3 was the implementing and monitoring
agency of the DDU scheme within the Union Territory of Jammu and
Kashmir, as evident from its own website and the Ajeevika State Guidelines
of September, 2013. Additionally, it is a matter of record that respondent no.
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1 vide order dated 27 November, 2018 transferred the Project from
respondent no. 2 to respondent no. 3. Further, respondent nos. 2 and 3 were
to take conjoint action, as evident from a bare perusal of notification no.
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Signing Date:02.07.2026
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ARB.P. 605/2025 Page 8 of 46

70/2015 .
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5.10. In the minutes of meeting dated 12 October, 2021 held in presence
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of all the respondents, shared vide communication dated 20 October, 2021,
it was expressly stated that the earlier MoU is still valid, and would be
honoured by both respondent nos. 2 and 3. It was further clarified in the
aforesaid communication that any release of payment to be made with
respect to the Project shall be done after due process, and from the funds
which are with respondent no. 3. Therefore, respondent no. 3 was also
bound by the terms of the MoU, and is a necessary party to the present
proceedings.
5.11. Thus, respondent no. 1 is the fund disbursal agency, whereas,
respondent nos. 2 and 3 are Implementing Agencies, thereby, playing a
crucial role in non-disbursal of the funds to the petitioner.
5.12. The scope of inquiry under Section 11 of the Arbitration Act is
limited to determination of “existence of arbitration agreement” and nothing
else. Moreover, the entire exercise of determining whether a non-signatory
is bound by an arbitration agreement, in contradistinction to the narrow
question of the existence of the arbitration agreement, necessitates a far
more expansive enquiry.
5.13. The adjudication exercised by the Referral Courts under Section 11 of
the Arbitration Act is judicial in nature and any opinion of the said Courts
would usurp the Arbitral Tribunal’s role as the forum of first instance for
dispute resolution. The grievance of respondent no. 1 pertaining to non-
impleadment ought to be raised before the Arbitral Tribunal.
5.14. This Court necessarily has territorial jurisdiction to entertain the
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By:HARIOM SHARMA
Signing Date:02.07.2026
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ARB.P. 605/2025 Page 9 of 46

present petition since respondent no. 2 is merely a pass-through agency,
acting on behalf of respondent no. 1.
5.15. Further, when the arbitration agreement is silent on the aspect of
“seat”, “venue” or “place” of arbitration, the determining factor will be
where the cause of action has arisen, as well as where the respondent
actually/voluntarily resides or carries its business. Section 2(1)(e) of the
Arbitration Act has to be read with Sections 16 to 20 of the Code of Civil
Procedure Code, 1908 (“CPC”) to determine the territorial jurisdiction of
the Court in a petition filed under Section 11 of the Arbitration Act.
5.16. As per the terms of the MoU, respondent no. 1, i.e., the decision-
making authority, has the right to terminate the MoU by issuing a notice of
termination to the petitioner. Additionally, the Sanction Letter and the
revised Sanction Letter were also issued by respondent no. 1, which also
specified that the total cost of the Project shall be borne entirely by the
Central Government. Respondent no. 1, who was exercising the effective
administrative and financial control over the Project, has its registered
address within the territorial jurisdiction of this Court.
5.17. Respondent no. 1, i.e., the MoRD has its registered office at Krishi
Bhawan, Dr. Rajendra Prasad Road, New Delhi , and is exercising an
imperative role in administering the Project, thereby, conferring territorial
jurisdiction upon this Court to adjudicate the present petition.
5.18. Even though the MoU between the petitioner and respondent no. 2
was signed in Hyderabad, however, the stamp paper affixed to the said MoU
was generated in New Delhi.
5.19. The two suits, being CS(COMM) 692/2025 and CS(COMM) 43/2025 ,
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Signing Date:02.07.2026
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ARB.P. 605/2025 Page 10 of 46

have been instituted by the petitioner herein, however, the same arise out of
different contracts, having different subject matters. Further, the said
contracts do not have an Arbitration Clause. Therefore, the said proceedings
do not have substantially similar issues, as those raised in the present
petition.
5.20. The present petition has been filed within the stipulated limitation
period. By way of various communications, respondent nos. 2 and 3 have
duly acknowledged the debt owed to the petitioner, and have assured that
relevant financial disbursement would be made in favour of the petitioner.
Additionally, respondents have, till date, not disputed the petitioner’s
entitlement to the dues, rather even in its reply to the notice invoking
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arbitration dated 25 February, 2025, respondent no. 2 has acknowledged
the said dues, and has proposed respondent no. 1 to expedite the release of
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the same. Thus, these acknowledgments, on 18 May, 2020 and 04 August,
2022 are tantamount to acknowledgements of debt under Section 18 of the
Limitation Act, 1963 (“Limitation Act”) , and constitute a fresh cause of
action.
SUBMISSIONS MADE BY RESPONDENT NO. 1:
6. Rebutting the contentions of the petitioner, the submissions made by
the respondent no. 1, are as under:
6.1. The present petition is liable to be dismissed on the grounds of
misjoinder of parties since respondent no. 1 is neither a necessary nor a
proper party to the present proceedings.
6.2. The MoU was exclusively between the petitioner and respondent no.
2, and admittedly, respondent no. 1 is not a signatory to the same. Therefore,
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ARB.P. 605/2025 Page 11 of 46

respondent no. 1 has no privity of contract with the petitioner. Further, no
arbitration agreement has been signed between the petitioner and respondent
no. 1, which is a mandatory requirement as per Section 7 of the Arbitration
Act.

6.3. The MoU is silent on the aspect of jurisdiction and it is an admitted
fact that the MoU was executed between the petitioner and respondent no. 2
at Hyderabad for the Project in Union Territory of Jammu and Kashmir.
Additionally, the petitioner and respondent no. 2 are situated in Tamil Nadu
and Hyderabad, respectively.
6.4. Respondent no. 1 sanctioned the Project in favour of the petitioner
under the DDU scheme, and had accordingly released a sum of Rs.
33,54,372/- (being the 25% share of the total project cost of Rs.
1,34,17,488/-). Thereafter, in compliance of the notification no. 70/2015
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dated 21 December, 2015, respondent no. 1 approved the transfer of the
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“Year Plan” to “Action Plan”. Accordingly, vide letter dated 27 November,
2018, the present Project was transferred to respondent no. 3, thereby,
making the respondent no. 3 as an Action Plan State. In compliance of the
notification no. 70/2015 , the petitioner, respondent no. 2 and respondent no.
3 were liable to execute an addendum to the MoU, but they failed to execute
the same.
6.5. Thus, upon the aforesaid transfer of the Project, respondent no. 1 has
no authority to take any further action on any issue in the said Project.
Further, respondent no. 3 is a necessary and proper party to the dispute, and
in the absence of any valid arbitration agreement between the petitioner and
respondent no. 3, the present matter cannot be adjudicated.
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Signing Date:02.07.2026
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ARB.P. 605/2025 Page 12 of 46

6.6. The petitioner failed to achieve the milestones of the Project
sanctioned and is misrepresenting to State authorities that the petitioner has
completed the requisite targets. Hence, the said issue requires detailed
adjudication before the appropriate court of law.

6.7. The petitioner herein has instituted certain civil suits, namely,
CS(COMM) 692/2025 and CS(COMM) 43/2025 , which are sub judice
before this Court. In the said suits, substantially similar issues have been
raised as those in the present proceedings. Thus, in view of the pendency of
the said suits, the present petition is liable to be dismissed to prevent
multiplicity of proceedings.

SUBMISSIONS MADE BY RESPONDENT NO. 2:
7. The submissions put forth by respondent no. 2, i.e., NIRD, are as
follows:
7.1. Respondent no. 2 is an autonomous body working under the aegis of
respondent no. 1, acting as a bridge between respondent no. 1 and the
Project Implementing Agencies, by being involved in scrutinizing data,
checking reports and releasing payments during all such time, while the
Projects remain within the control of respondent no. 1, prior to it being
transferred to the relevant State and their agencies.

7.2. The case of the petitioner is that they are entitled to certain payments,
which are to be released by respondent no. 1, through respondent no. 2, until
the Project stood transferred to respondent no. 3. Pursuant to the transfer, the
role of respondent no. 2 was restricted to that of a Central Technical Support
Agency, and the financial powers, if any, were also taken away from
respondent no. 2. Thus, the payment thereafter is to be done by respondent
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ARB.P. 605/2025 Page 13 of 46

no. 3, in consultation with respondent no. 1.
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7.3. Further, vide letter dated 06 January, 2021, respondent no. 1 clarified
that the respondent no. 2 should not be a party to the MoU, which is to be
signed by respondent no. 3 and the petitioner, subsequent to the transfer of
the Project. Consequently, respondent no. 2 ceased to have any
contractual/financial dealings with the petitioner. Thus, respondent no. 2 is
legally barred from performing any obligations under the MoU due to
superseding notification transferring the Project to respondent no. 3.
7.4. The MoU, by way of which, the petitioner is invoking arbitration, has
already attained nullity, upon the transfer of the Project in favour of
respondent no. 3. Further, upon such transfer, the petitioner was to execute
an addendum to the MoU, which it failed to do, and is now trying to impose
the liability on respondent no. 2.
7.5. Thus, the notice invoking arbitration was wrongly addressed to
respondent no. 2, who no longer has privity or control over the funds.
Therefore, the invocation of the Arbitration Clause itself is invalid.
7.6. This Court has no jurisdiction to entertain the present petition since
neither the MoU has been entered upon in Delhi, nor any of the parties are
situated within the jurisdiction of this Court. Further, admittedly, the
petitioner is situated in Chennai, Tamil Nadu, and it entered into the MoU
with respondent no. 2 in Hyderabad, where the respondent no. 2 is situated,
for the work to be executed in Union Territory of Jammu and Kashmir.
7.7. The petitioner has filed the present petition solely on account of the
fact that the stamp paper over which the MoU was executed, was created in
New Delhi. However, the same would not, ipso facto , make New Delhi as
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ARB.P. 605/2025 Page 14 of 46

the place for conducting the arbitration proceedings, in the absence of any
covenant in the MoU with regard thereto.
7.8. Additionally, the present dispute emanates from independent
administrative decisions of the Government of India (“GOI”) and not from
any private commercial contracts. Issues related to implementation of
Government policies and release of public funds are public functions and are
not amenable to arbitration.
7.9. Moreover, the present petition is also not maintainable on account of
it being barred by limitation.
SUBMISSIONS MADE BY RESPONDENT NO. 3:
8. The submissions on behalf of respondent no. 3, are as follows:
8.1. Respondent no. 3 works under the aegis of Department of Rural
Development and Panchayati Raj of Jammu and Kashmir, and as such, is a
completely distinct body from respondent nos. 1 and 2.
8.2. Respondent no. 3 herein is neither a party nor a signatory to the MoU,
and as such, could not have been arrayed as a respondent in the present
petition. Further, the MoU and its terms cannot be made binding upon
respondent nos. 1 and 3.
8.3. The claims of the petitioner for pending dues with regard to the
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Project are based upon the MoU, Sanction Letter dated 11 February, 2016
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and revised Sanction Letter dated 19 December, 2016, and none of the said
documents fasten any liability on respondent no. 3 for making payments to
the petitioner.
8.4. Subsequent to the transfer of the Project to respondent no. 3, a
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proposal was sent by respondent no. 1 vide letter dated 06 January, 2021,
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ARB.P. 605/2025 Page 15 of 46

that only an addendum to the MoU is required to be executed, instead of tri-
partite agreement.
8.5. However, in pursuance of the same, respondent no. 3 had neither sent
any such draft of the addendum , nor replied to the draft of addendum sent
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vide E-mail dated 10 June, 2021 by the petitioner to respondent no. 3.
Thus, there exists no addendum to the MoU, thereby, concluding that
respondent no. 3 has no privity with the MoU and the Sanction Letters.

ANALYSIS AND FINDINGS:
9. I have heard learned counsels appearing for the parties and have
perused the documents on record.
10. The paramount question that arises for determination by this Court is
whether this Court has territorial jurisdiction to entertain the present petition.
Furthermore, the other issue to be considered by this Court is as to whether
respondent nos. 1 and 3, not being signatories to the MoU, can be referred to
arbitration. Both the issues being intertwined, they are taken up by the Court
together.
11. At the outset, this Court notes that the petitioner has its registered
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office in Chennai at The Hive, 3 Floor, No. 44, Pilliayar Koil Street, Anna
Nagar, Chennai, Tamil Nadu – 600040 .

12. Respondent no. 1, i.e., MoRD, is situated in Delhi at Krishi Bhawan,
Dr. Rajendra Prasad Road, New Delhi – 110001 . Further, respondent no. 2,
namely, NIRD is an autonomous organisation of respondent no. 1 and acts
as a Technical Support Agency for coordinating and monitoring projects for
respondent no. 1 and is located in Hyderabad at NIRD Road, Hyderabad,
Telangana – 500030. Additionally, respondent no. 3 is also a state
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ARB.P. 605/2025 Page 16 of 46

government entity for monitoring the development projects in Union
Territory of Jammu and Kashmir and is situated at both Jammu and
Srinagar, Jammu and Kashmir.
13. It is pertinent to note that in the present case, the MoU containing the
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Arbitration Clause has been signed in Hyderabad on 02 April, 2016, only
between the petitioner and respondent no. 2, in relation to the Project in
Union Territory of Jammu and Kashmir, having a total Project cost of Rs.
1,34,17,488/-. Admittedly, the stamp paper for the MoU has been
purchased/created in the NCT of Delhi.
14. In terms of the MoU, the petitioner was designated as a Programme
Implementation Agency for the Project, aimed at assisting rural youths in
Union Territory of Jammu and Kashmir under the scheme introduced by
respondent no. 1. Further, the dispute between the parties herein has arisen
on account of alleged non-payment of amounts due and payable to the
petitioner towards the Project.
15. The Dispute Resolution Clause is contained in Article VIII, Clause 14
of the MoU, which is reproduced hereinbelow:
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ARB.P. 605/2025 Page 17 of 46

16. A perusal of the aforesaid Dispute Resolution Clause shows that all
disputes arising out of the MoU, which cannot be amicably settled, shall be
referred to arbitration in accordance with the provisions of the Arbitration
Act. However, the said Clause does not specify either the seat or the venue
of the arbitration.
17. Since the Dispute Resolution Clause is silent with regard to the seat or
venue of the arbitration, it is necessary to ascertain whether this Court can
be said to have territorial jurisdiction to entertain the present petition. In this
regard, it is to be noted that the dispute raised by the petitioner essentially
pertains to the non-payment of the amounts due in relation to the Project.
Thus, delving on the aspect of territorial jurisdiction and holding that while
determining territorial jurisdiction of a Court, what is decisive is the accrual
of cause of action, this Court in the case of Prashant Kumar Parashar
Versus Sumit Singla and Another, 2025 SCC OnLine Del 1745 , has held as
under:
“xxx xxx xxx

9 . As regards the question of territorial jurisdiction of this Court, it is
purely decided based on the arbitration agreement existing in the
Partnership Deed. It is a settled position in law that when the arbitration
agreement is silent on the aspect of ‘seat’, ‘venue’ or ‘place’ of
arbitration, the determining factor will be where the cause of action
arises as well as where the defendant/respondent actually or voluntarily
resides or carries on their business. In other words, Section 2(1)(e) of the
A&C Act has to be read in light with Sections 16 to 20 of CPC to
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determine the territorial jurisdiction of the Court at the stage of
considering referral to arbitration in a petition under Section 11 A&C of
the Act.

10. A gainful reference may be made to the decisions of the Supreme Court
in BBR (India) (P) Ltd. v. S.P. Singla Constructions (P) Ltd., (2023) 1
SCC 693, and Ravi Ranjan Developers (P) Ltd. v. Aditya Kumar
Chatterjee, reported as 2022 SCC OnLine SC 568. In the latter, it was
held, as under:

“27. At the same time, an application under Section 11(6) of
the A&C Act for appointment of an Arbitrator/Arbitral Tribunal
cannot be moved in any High Court in India, irrespective of its
territorial jurisdiction. Section 11(6) of the A&C Act has to be
harmoniously read with Section 2(1)(e) of the A&C Act and
construed to mean, a High Court which exercises
superintendence/supervisory jurisdiction over a Court within the
meaning of Section 2(1)(e) of the A&C Act.

28. It could never have been the intention of Section 11(6) of
the A&C Act that arbitration proceedings should be initiated in any
High Court in India, irrespective of whether the Respondent
resided or carried on business within the jurisdiction of that High
Court, and irrespective of whether any part of the cause of action
arose within the jurisdiction of that Court, to put an opponent at a
disadvantage and steal a march over the opponent.”


11. A perusal of the aforenoted legal position makes it amply clear that
at the stage of determining the jurisdiction of the Court to entertain a
Section 11 A&C Act petition, in case of lack of consent between the
parties as to the seat/venue of arbitration, which is reflected from the
arbitration clause of the subject agreement, the Court must determine
jurisdiction by taking the aid of Sections 16 to 20 of the CPC. In such a
case, two factors are of relevance– (i) where the respondent actually or
voluntarily resides or carries on their business, and (ii) where the cause
of action, wholly or in part, arises. As regards the first factor, it is
undisputed that both the respondents reside in Bangalore. Therefore,
our discussion becomes predominantly centred around examining the
second factor, i.e., where the cause of action arises .

12. A catena of Supreme Court decisions have clarified that while
determining territorial jurisdiction of a Court, what is decisive is the
accrual of cause of action. In other words, cause of action is a bundle of
facts which create rights and obligations and gives rise to the right to sue
to a party. Moreover, cause of action is made up of material and integral
facts. This implies that not every insignificant or inconsequential fact
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becomes a part of cause of action. In fact, for a fact to be considered
material enough to lead to the conclusion as to accrual of cause of
action, it must be proved that the said fact has a nexus with lis between
the parties and that it is integral to the dispute at hand. Reference may
be made to the decision of the Apex Court in Alchemist Ltd. v. State
Bank of Sikkim, (2007) 11 SCC 335 . Relevant part of it is reproduced
herein:


“25. The learned counsel for the respondents referred to
several decisions of this Court and submitted that whether a
particular fact constitutes a cause of action or not must be decided
on the basis of the facts and circumstances of each case . In our
judgment, the test is whether a particular fact(s) is (are) of
substance and can be said to be material, integral or essential
part of the lis between the parties. If it is, it forms a part of cause
of action . If it is not, it does not form a part of cause of action. It is
also well settled that in determining the question, the substance of
the matter and not the form thereof has to be considered.”

13. Territorial jurisdiction of a Court is ascertained having regard to the
place of accrual of cause of action. Some of the relevant principles that
have developed in this area of jurisprudence are, including but not
limited to, that making and signing of a contract constitutes cause of
action; that facts which are necessary to decide the lis between the
parties must have wholly or at least in part, arisen within the territorial
jurisdiction of the Court; that each fact pleaded in the petition would not
ipso facto be considered relevant while determining cause of action and
that they must have a nexus with the issues involved in the matter; and
importantly, that an insignificant or trivial part of cause of action would
not be sufficient to confer territorial jurisdiction, even if incidentally
forming a part of cause of action .

14 . Moreover, while determining accrual of cause of action vis-à-vis part
payment, law is clear on the aspect insofar as the relevant factor for
consideration is where money is expressly or impliedly payable. Such a
place, when either specified by the terms of the contract or evident by the
intent of the parties, shall validly have jurisdiction to adjudicate upon
disputes arising out of the concerned contract. Reliance is placed on the
decision of the Apex Court in A.B.C. Laminart (P) Ltd. v. A.P. Agencies,
(1989) 2 SCC 163; relevant parts being reproduced hereinunder:

“13. Under Section 20(c) of the Code of Civil Procedure
subject to the limitation stated theretofore, every suit shall be
instituted in a court within the local limits of whose jurisdiction
the cause of action, wholly or in part arises. It may be
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remembered that earlier Section 7 of Act 7 of 1888 added
Explanation III as under:

“Explanation III.—In suits arising out of contract the cause of
action arises within the meaning of this section at any of the
following places, namely:
(1) the place where the contract was made;
(2) the place where the contract was to be performed or
performance thereof completed;
(3) the place where in performance of the contract any money to
which the suit relates was expressly or impliedly payable.”

xxx xxx xxx”
(Emphasis Supplied)

18. Accordingly, the settled legal position is that where the Arbitration
Clause is silent on the aspect of seat, venue, or place of arbitration, the
Court, at the stage of considering a petition under Section 11 of the
Arbitration Act, is required to determine the territorial jurisdiction by
reference to Sections 16 to 20 of the CPC, read with Section 2(1)(e) of the
Arbitration Act. In terms thereof, the Court will have to consider as to where
the cause of action, wholly or in part, arises, or where the respondent
actually/voluntarily resides or carries on business.
19. It is apposite to note that territorial jurisdiction for entertaining civil
suits has been provided in Sections 16 to 20 of the CPC. Accordingly, a
Court within whose jurisdiction, the defendant actually or voluntarily resides
or carries on business, or where any part of cause of action, wholly or in
part, has arisen, would have territorial jurisdiction to entertain the suit.
Consequently, where the arbitration agreement does not specify the seat or
place of arbitration, the territorial jurisdiction of the Court for entertaining
the petition under Section 11 of the Arbitration Act, is required to be
determined by referring to Sections 16 to 20 of the CPC.
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20. Reference in this regard is made to the judgment passed in the case of
Ravi Ranjan Developers Pvt. Ltd. Versus Aditya Kumar Chatterjee, 2022
SCC OnLine SC 568 , wherein, the Supreme Court has held as follows:
“xxx xxx xxx

23. Subject to the pecuniary or other limitations prescribed by any law,
suits for recovery of immovable property or determination of any other
right to or interest in an immovable property or compensation for wrong
to immovable property, is to be instituted in the Court, within the local
limits of whose jurisdiction, the property is situated. Certain specific suits
relating to immovable property can be instituted either in the Court within
the limits of whose jurisdiction the property is situated, or in the Court
within the local limits of whose jurisdiction the Defendant actually or
voluntarily resides or carries on business.

24. All other suits are to be instituted in a Court, within the local limits
of whose jurisdiction the Defendant voluntarily resides or carries on
business. Where there is more than one Defendant, a suit may be
instituted in the Court within whose jurisdiction any of the Defendants
voluntarily resides or carries on business. A suit may also be instituted in
a Court within whose jurisdiction the cause of action arises either wholly
or in part .

xxx xxx xxx

26. Of course, under Section 11(6), an application for appointment of an
Arbitrator necessarily has to be moved in the High Court, irrespective of
whether the High Court has the jurisdiction to decide a suit in respect of
the subject matter of arbitration and irrespective of whether the High
Court at all has original jurisdiction to entertain and decide suits. As such,
the definition of Court in Section 2(1)(e) of the A&C Act would not be
applicable in the case of a High Court exercising jurisdiction under
Section 11(6) of the A&C Act to appoint an Arbitrator/Arbitral Tribunal.

27. At the same time, an application under Section 11(6) of the A&C Act
for appointment of an Arbitrator/Arbitral Tribunal cannot be moved in
any High Court in India, irrespective of its territorial jurisdiction.
Section 11(6) of the A&C Act has to be harmoniously read with Section
2(1)(e) of the A&C Act and construed to mean, a High Court which
exercises superintendence/supervisory jurisdiction over a Court within
the meaning of Section 2(1)(e) of the A&C Act .

28. It could never have been the intention of Section 11(6) of the A&C Act
that arbitration proceedings should be initiated in any High Court in
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India, irrespective of whether the Respondent resided or carried on
business within the jurisdiction of that High Court, and irrespective of
whether any part of the cause of action arose within the jurisdiction of that
Court, to put an opponent at a disadvantage and steal a march over the
opponent.

xxx xxx xxx”
(Emphasis Supplied)

21. Likewise, reiterating that the territorial jurisdiction of a Court is
ascertained, having regard to the place where the cause of action, wholly or
in part, has accrued, this Court in the case of Faith Constructions Versus
N.W.G.E.L Church, 2025 SCC OnLine Del 1746 , held as follows:
“xxx xxx xxx

7. As regards the primary objection taken by the respondent vis-à-vis
territorial jurisdiction of this Court to entertain the present petition, the
same warrants a factual and legal analysis. It is a settled position in law
that when the arbitration agreement is silent on the aspect of ‘seat’,
‘venue’ or ‘place’ of arbitration, the determining factor will be where the
cause of action arises as well as where the defendant/respondent actually
or voluntarily resides or carries on their business. In other words,
Section 2(1)(e) of the A&C Act has to be read in light with Sections 16 to
20 of CPC to determine the territorial jurisdiction of the Court at the
stage of considering referral to arbitration in a Section 11 A&C Act
petition .

A gainful reference may be made to the decisions of the Supreme
Court in BBR (India) (P) Ltd. v. S.P. Singla Constructions (P) Ltd., (2023)
1 SCC 693, and Ravi Ranjan Developers (P) Ltd. v. Aditya Kumar
Chatterjee, 2022 SCC OnLine SC 568. In the latter, it was held, as under:

“27. At the same time, an application under Section 11(6) of
the A&C Act for appointment of an Arbitrator/Arbitral Tribunal
cannot be moved in any High Court in India, irrespective of its
territorial jurisdiction. Section 11(6) of the A&C Act has to be
harmoniously read with Section 2(1)(e) of the A&C Act and
construed to mean, a High Court which exercises
superintendence/supervisory jurisdiction over a Court within the
meaning of Section 2(1)(e) of the A&C Act.

28. It could never have been the intention of Section 11(6) of
the A&C Act that arbitration proceedings should be initiated in any
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High Court in India, irrespective of whether the Respondent
resided or carried on business within the jurisdiction of that High
Court, and irrespective of whether any part of the cause of action
arose within the jurisdiction of that Court, to put an opponent at a
disadvantage and steal a march over the opponent.”

8 . A perusal of the aforenoted legal position makes it amply clear that at
the stage of determining the jurisdiction of the Court to entertain a
petition under Section 11 A&C Act, in case of lack of consent between
the parties as to the seat/venue of arbitration, which is reflected from the
arbitration clause of the subject agreement, the Court must determine
jurisdiction by taking the aid of Sections 16 to 20 of the CPC. In such a
case, two factors are of relevance- (i) where the respondent actually or
voluntarily resides or carries on their business, and (ii) where the cause
of action, wholly or in part, arises. As regards the first factor, it is
undisputed that the respondent resides and carries on its business in the
state of Odisha. Therefore, the discussion becomes predominantly centred
around examining the second factor, i.e., where the cause of action arises.

9. A catena of Supreme Court decisions have clarified that while
determining territorial jurisdiction of a Court, what is decisive is the
accrual of cause of action. In other words, cause of action is a bundle of
facts which create rights and obligations and gives rise to the right to sue
to a party. Moreover, cause of action is made up of material and integral
facts. This implies that not every insignificant or inconsequential fact
becomes a part of cause of action. In fact, for a fact to be considered
material enough to lead to the conclusion as to accrual of cause of action,
it must be proved that the said fact has a nexus with lis between the parties
and that it is integral to the dispute at hand. Reference may be made to the
decision of the Apex Court in Alchemist Ltd. v. State Bank of Sikkim,
(2007) 11 SCC 335. Relevant part of it is reproduced herein:

“25. The learned counsel for the respondents referred to
several decisions of this Court and submitted that whether a
particular fact constitutes a cause of action or not must be decided
on the basis of the facts and circumstances of each case. In our
judgment, the test is whether a particular fact(s) is (are) of
substance and can be said to be material, integral or essential
part of the lis between the parties. If it is, it forms a part of cause
of action. If it is not, it does not form a part of cause of action. It
is also well settled that in determining the question, the substance
of the matter and not the form thereof has to be considered.”

(Emphasis supplied)


10. Territorial jurisdiction of a Court is ascertained having regard to the
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place of accrual of cause of action. Some of the relevant principles that
have developed in this area of jurisprudence are, including but not
limited to, that making and signing of a contract constitutes cause of
action; that facts which are necessary to decide the lis between the
parties must have wholly or at least in part, arisen within the territorial
jurisdiction of the Court; that each fact pleaded in the petition would not
ipso facto be considered relevant while determining cause of action and
that they must have a nexus with the issues involved in the matter; and
importantly, that an insignificant or trivial part of cause of action would
not be sufficient to confer territorial jurisdiction, even if incidentally
forming a part of cause of action.

11 . Having discussed the prevalent legal position as to determination of
accrual of cause of action, it is evident that for a fact to form part of the
cause of action, it must be material and substantial in nature, in such a
way that it effects the rights or obligations of the parties, and not
incidental or remote thereto . Keeping in view the above, the factual
position of the present case may be analysed.

xxx xxx xxx”
(Emphasis Supplied)


22. Thus, considering that the MoU containing the Arbitration Clause was
executed in Hyderabad, in relation to a Project to be implemented in Union
Territory of Jammu and Kashmir, and was executed between the petitioner,
having its registered office at Chennai, and respondent no. 2, having its
office at Hyderabad, this Court is required to determine whether any part of
the cause of action has arisen within its territorial jurisdiction.
23. In this regard, a gainful reference may be made to the relevant terms
nd
and conditions of the MoU dated 02 April, 2016.
I. Clause 1 of the MoU as contained in the Recital , stipulates that
respondent no. 1 was to provide grant-in-aid to the petitioner, through
respondent no. 2, in three instalments in the ratio of 25:50:25. Further,
Clause 7(iv) of the MoU as contained in the Recital records that respondent
no. 1 and the petitioner had mutually agreed to pool their resources for the
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implementation of the Project.
II. As per Clause 5 of the MoU as contained in the Recital , respondent
no. 1 had approved respondent no. 2 as “Programme Monitoring and Pass
Through Agency” for the purposes of implementation of the Project.

III. Article I, Clause 2 of the MoU further provides for the services to be
provided by respondent no. 2 as a Monitoring Agency, which, inter alia ,
includes disbursing payments to the petitioner from the funds received from
respondent no. 1, reviewing the Project and submitting reports thereof to
respondent no. 1.
IV. Article II, Clause 5 of the MoU pertains to the cost structure of the
Project, wherein, it has been stated in Clause 5.6 that the release of funds
shall be subject to internal audit of respondent no. 1.
V. Article III, Clause 8 of the MoU deals with termination of the MoU
and provides that respondent no. 1 may terminate the MoU and put the
petitioner under blacklist after giving 30 days’ notice, upon occurrence of
the events as specified therein.
VI. In terms of Article IV, Clause 10, i.e., Programme Implementation,
the petitioner had to submit the time-table, cost and financial schedule for
implementation of the Project to the MoRD, through respondent no. 2. It
further provides that any modifications to the Project shall be undertaken
only after consultation with respondent no. 1. The said Clause also
contemplates the constitution of a Project Steering Committee, with the Joint
Secretary of respondent no. 1 as its Chairperson, to review the progress of
the Project. Additionally, the petitioner was required to furnish progress
reports and other information relating to the Project to respondent no. 2,
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which, in turn, was obligated to forward the same to respondent no. 1.
24. Apart from the aforesaid terms of the MoU, reference may also be
made to the correspondence exchanged between the parties, which throws
considerable light on the role played by respondent nos. 1 and 3, in relation
to the MoU in question, notwithstanding the fact that they are not signatories
thereto.
th
I. The Sanction Letter dated 11 February, 2016 was issued by
respondent no. 1 at New Delhi in favour of the petitioner, whereby, the
Project was sanctioned and the entire Project Cost was to be borne by
respondent no. 1. Pursuant thereto, the first instalment of Rs. 33,54,372/-,
towards the total cost was released by respondent no. 1, through respondent
no. 2, to the petitioner.
II. Thereafter, respondent no. 1 issued a revised Sanction Letter dated
th
19 December, 2016 at New Delhi to the petitioner, whereby, it revised the
target of the Project and also the cost of the Project to Rs. 1,40,16,985/-.
III. Upon a request made by the petitioner for release of the second
st
instalment, respondent no. 2 addressed a communication dated 01 May,
2018 to respondent no. 1 recommending the release of the second instalment
of Rs. 70,08,492/-, since the documents for the Project, as verified by
respondent no. 2, were found to be in order.
th
IV. By the order dated 27 November, 2018, respondent no. 1 informed
st
respondent no. 2 that in terms of notification no. 70/2015 dated 21
December, 2015, respondent no. 1 has approved the transfer of the Project to
respondent no. 3, as part of its transition from “Year Plan” to “Action Plan”.
th
V. Thereafter, the petitioner addressed letters dated 07 May, 2019 and
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st
21 April, 2020 to respondent no. 1, requesting the release of funds and
raising other issues concerning the Project.
th
VI. By way of its letter dated 06 January, 2021 addressed to respondent
no. 2, respondent no. 1 stated that action with regard to release of funds shall
be taken subsequent to the signing of addendum to MoU by the State.
th
VII. Reference may also be made to the minutes of meeting dated 12
October, 2021 held in presence of all the respondents, convened to resolve
the issue relating to payment for the Project. The said minutes of meeting
records that since the Project already stands completed, there was no
requirement to sign an addendum to the MoU, and thus, the existing MoU
was valid and to be honoured by respondent nos. 2 and 3.
VIII. It was further stipulated in the said minutes of meeting that
respondent no. 3 was required to take action with regard to the aforesaid,
and for any clarification, it may write to respondent no. 2 or respondent no.
1. It was further noted that any release of funds was to be made from the
funds lying with respondent no. 3. However, prior to any such release,
respondent no. 3 was to inform respondent no. 1, in case, any adjustment
was required in the Project.
th
IX. Reference may further be made to the letter dated 25 February, 2025,
addressed by respondent no. 2 to respondent no. 1, wherein, respondent no.
2 has stated that despite its recommendation, the amount due and payable to
the petitioner had not been released. Respondent no. 2 further proposed that
respondent no. 1 may advise respondent no. 3 to release the pending amount,
as the petitioner had achieved the prescribed targets.
X. It is also pertinent to note that the notice invoking arbitration dated
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th
05 February, 2025 was issued by the petitioner, wherein, respondent no. 2
along with respondent nos. 1 and 3, were also the recipients, and were duly
served.
th
XI. Furthermore, by way of the reply dated 06 March, 2025 to the notice
invoking arbitration, respondent no. 3 denied being part of the appointment
process, however, has admitted that the communications made by the
petitioner were towards respondent no. 1 and respondent no. 2. Respondent
no. 3 further stated that it had addressed a communication to respondent no.
1 clarifying that it had no involvement in the disbursal of the payments
under the Project.
25. In the present case, admittedly, the MoU was executed between
respondent no. 2 and the petitioner for the Project. The said Project was
initiated under the DDU scheme introduced by respondent no. 1. Further, the
cost of the said Project was to be borne by respondent no. 1, which was to
grant funds to respondent no. 2, and respondent no. 2 was thereafter required
to disburse the same to the petitioner.
26. Moreover, the terms of the MoU, as noted herein above, clearly show
that respondent no. 1 was also involved in the Project on account of the fact
that respondent no. 1 has the power to terminate the MoU. Additionally,
respondent no. 2, as a Monitoring Agency, was required to review and report
any updates regarding the Project to respondent no. 1, and inter alia , any
modifications to the Project was to be done pursuant to consultation with
respondent no. 1.
27. Furthermore, the correspondence placed on record, between the
th
petitioner and respondents, such as, the letter dated 25 February, 2025
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issued by respondent no. 2 to respondent no. 1, also shows that the action
regarding disbursal of the dues to the petitioner was to be done pursuant to
the advice/recommendation given by respondent no. 1.
28. Further, it is an admitted position that subsequent to the notification
st
no. 70/2015 dated 21 December, 2015, the Project stood transferred to
th
respondent no. 3. The minutes of meeting dated 12 October, 2021, clearly
records that any release of funds was to be made from the funds, which are
with respondent no. 3. Prior to any such release, respondent no. 3 may
inform respondent no. 1, in case, any adjustment is required in the Project.
In the said minutes of meeting, it has also been recorded that on account of
the Project being completed, there was no need to sign an addendum , and
thus, the existing MoU is still valid and to be honoured by respondent nos. 2
and 3.
29. Thus, perusal of the aforenoted terms of the MoU and the
correspondence exchanged between the parties clearly brings forth that
although respondent no. 1 and 3 were not signatories to the MoU, however,
the mutual intent, conduct, relationship with the signatory parties,
commonality of the subject matter coupled with performance and
termination, clearly prima facie signify the intention of non-signatories to be
bound by the arbitration agreement.
30. Accordingly, in view of the aforesaid, this Court is of the prima facie
opinion that notwithstanding the fact that respondent nos. 1 and 3 have not
specifically signed the MoU, their conduct in relation to the Project and their
role under the MoU are sufficient, at this stage, to indicate that they were
intended to be bound by the terms thereof, including the Arbitration Clause.
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Thus, this Court, while exercising jurisdiction under Section 11 of the
Arbitration Act, has the authority to refer the parties to arbitration, however,
leaving it open to the Arbitral Tribunal to finally determine, on the basis of
the evidence on record, whether the non-signatories, i.e., respondent nos. 1
and 3, are indeed bound by the arbitration agreement.
31. In this regard, reliance is placed upon the judgment in the case of
Hindustan Petroleum Corporation Limited Versus BCL Secure Premises
Private Limited, (2026) 3 SCC 711 , wherein, it was held as follows:
“xxx xxx xxx


24.⁠ ⁠A careful reading of the above passage reveals that the Referral Court
should be prima facie satisfied that there exists an arbitration agreement
and as to whether the non-signatory is a veritable party. It further holds
that even if the Referral Court prima facie arrives at the satisfaction that
the non-signatory is a veritable party, the Arbitral Tribunal is not
denuded of its jurisdiction to decide whether the non-signatory is indeed
a party to the arbitration agreement on the basis of factual evidence and
application of legal doctrine . The Court further reinforces this proposition
by holding that as to whether the non-signatory is bound would be for the
Arbitral Tribunal to decide.

25.⁠ ⁠ But what is primordial is that it should be demonstrated prima facie
before the Referral Court that the non-signatory is a veritable party .
According to the “Illustrated Oxford Dictionary (Revised Edition 2003)”
the word:

“veritable” means “real; rightly so called
(a veritable feast)”,

In substance, it means truly, genuinely or for all intended purposes. The
Referral Court under Section 11 is not deprived of its jurisdiction from
examining whether the non-signatory is in the real sense a party to the
arbitration agreement. The answer thereof will depend on the facts and
circumstances of each case after examining the documents pertaining
thereto.

xxx xxx xxx”
(Emphasis Supplied)

32. Furthermore, while elucidating the principles governing the binding
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nature of an arbitration agreement upon a non-signatory, the Supreme Court
in the case of Ajay Madhusudan Patel and Others Versus Jyotrindra S.
Patel and Others, (2025) 2 SCC 147 , observed that the conduct of the non-
signatory, along with other attending circumstances, may leave the Referral
Court to draw a legitimate inference that such non-signatory is, in fact, a
veritable party to the arbitration agreement. In this regard, it has been held as
follows:
“xxx xxx xxx


71. This very Bench in SBI General Insurance Co. Ltd. v. Krish Spg. [SBI
General Insurance Co. Ltd. v. Krish Spg., (2024) 12 SCC 1: 2024 SCC
OnLine SC 1754] dealt with the scope and standard of judicial scrutiny in
an application made under Section 11(6) of the 1996 Act specifically when
a plea of “accord and satisfaction” is taken by the defendant. It was
observed that in a scenario where the courts delve into the domain of the
Arbitral Tribunal at the Section 11 stage and reject the application, there
is a risk of leaving the claimant forum-less for the adjudication of its
claims. It was stated that a detailed examination at this stage would also
be counterproductive to the objective of expediency in deciding a Section
11 application and simplification of pleadings. It was also stated that
even if ex facie frivolity is made out by the referral court, the Arbitral
Tribunal has the benefit of extensive pleadings and evidentiary material
and therefore, it would be incorrect to doubt that the Arbitral Tribunal
would not be able to arrive at a similar conclusion .”


xxx xxx xxx

75.⁠ ⁠ Therefore, on the pivotal issue whether the non-signatories can be
referred to arbitration, this Court took the view that the referral court is
required to prima facie rule on the existence of the arbitration
agreement and whether the non-signatory party is a veritable party to the
arbitration agreement. However, recognising the complexity of such a
determination, the Arbitral Tribunal was considered the proper forum
since it can decide whether the non-signatory is a party to the arbitration
agreement on the basis of factual evidence and application of legal
doctrine. In this process, the non-signatory must also be given an
opportunity to raise objections regarding the jurisdiction of the Arbitral
Tribunal in accordance with the principles of natural justice.

xxx xxx xxx
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79.⁠ ⁠This Court in Cox & Kings [Cox & Kings Ltd. v. SAP India (P) Ltd.,
(2024) 4 SCC 1: (2024) 2 SCC (Civ) 1: (2024) 251 Comp Cas 680] held
that the definition of “parties” under Section 2(1)(h) read with Section 7
of the 1996 Act includes both the signatory as well as non-signatory
parties. Persons or entities who have not formally signed the arbitration
agreement or the underlying contract containing the arbitration
agreement may also intend to be bound by the terms of the agreement.
Further, the requirement of a written agreement under Section 7 of the
1996 Act does not exclude the possibility of binding non-signatory
parties if there is a defined legal relationship between the signatory and
non-signatory parties. Therefore, the issue as to who is a “party” to an
arbitration agreement is primarily an issue of consent. Actions or
conduct could be an indicator of the consent of a party to be bound by
the arbitration agreement. This aspect is also evident from a reading of
Section 7(4)(b) which emphasises on the manifestation of the consent of
persons or entities through actions of exchanging documents .

xxx xxx xxx

81 .⁠ ⁠ The fact that a non-signatory did not put pen to paper may be an
indicator of its intention to not assume any rights, responsibilities or
obligations under the arbitration agreement. However, the courts and
tribunals should not adopt a conservative approach to exclude all
persons or entities who intended to be bound by the underlying contract
containing the arbitration agreement through their conduct and their
relationship with the signatory parties. The mutual intent of the parties,
relationship of a non-signatory with a signatory, commonality of the
subject-matter, composite nature of the transactions and performance of
the contract are all factors that signify the intention of the non-signatory
to be bound by the arbitration agreement .

xxx xxx xxx

83.⁠ ⁠ It is evident that the intention of the parties to be bound by an
arbitration agreement can be gauged from the circumstances that
surround the participation of the non-signatory party in the negotiation,
performance, and termination of the underlying contract containing
such an agreement. Further, when the conduct of the non-signatory is in
harmony with the conduct of the others, it might lead the other party or
parties to legitimately believe that the non-signatory was a veritable party
to the contract containing the arbitration agreement. However, in order
to infer consent of the non-signatory party, their involvement in the
negotiation or performance of the contract must be positive, direct and
substantial and not be merely incidental. Thus, the conduct of the non-
signatory party along with the other attending circumstances may lead
the referral court to draw a legitimate inference that it is a veritable
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party to the arbitration agreement .

xxx xxx xxx”
(Emphasis Supplied)

33. Similarly, delving on the issue of a non-signatory being a veritable
party to the contract containing the arbitration agreement, the Supreme
Court in the case of Cox and Kings Limited Versus SAP India Private
Limited and Another, (2024) 4 SCC 1 , held as follows:
“xxx xxx xxx

126. Evaluating the involvement of the non-signatory party in the
negotiation, performance, or termination of a contract is an important
factor for a number of reasons. First, by being actively involved in the
performance of a contract, a non-signatory may create an appearance
that it is a veritable party to the contract containing the arbitration
agreement; second, the conduct of the non-signatory may be in harmony
with the conduct of the other members of the group, leading the other
party to legitimately believe that the non-signatory was a veritable party
to the contract; and third, the other party has legitimate reasons to rely
on the appearance created by the non-signatory party so as to bind it to
the arbitration agreement .

xxx xxx xxx

169. In case of joinder of non-signatory parties to an arbitration
agreement, the following two scenarios will prominently emerge: first,
where a signatory party to an arbitration agreement seeks joinder of a
non-signatory party to the arbitration agreement; and second, where a
non-signatory party itself seeks invocation of an arbitration agreement.
In both the scenarios, the referral court will be required to prima facie
rule on the existence of the arbitration agreement and whether the non-
signatory is a veritable party to the arbitration agreement. In view of the
complexity of such a determination, the referral court should leave it for
the Arbitral Tribunal to decide whether the non- signatory party is
indeed a party to the arbitration agreement on the basis of the factual
evidence and application of legal doctrine. The Tribunal can delve into
the factual, circumstantial, and legal aspects of the matter to decide
whether its jurisdiction extends to the non-signatory party. In the
process, the Tribunal should comply with the requirements of principles of
natural justice such as giving opportunity to the non-signatory to raise
objections with regard to the jurisdiction of the Arbitral Tribunal. This
interpretation also gives true effect to the doctrine of competence-
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competence by leaving the issue of determination of true parties to an
arbitration agreement to be decided by the Arbitral Tribunal under
Section 16.

xxx xxx xxx”
(Emphasis Supplied)
34. Having regard to the limited scope and standard of judicial scrutiny
under Section 11 of the Arbitration Act, this Court considers it inappropriate
to make a conclusive determination as to whether respondent nos. 1 and 3
are veritable parties to the arbitration agreement. The said issue necessarily
entails an extensive appreciation of pleadings and evidentiary material.
Accordingly, the final determination of whether respondent nos. 1 and 3 are
amenable to the arbitral proceedings is best left to be adjudicated by the
Arbitral Tribunal.
35. In light of the aforesaid discussion, this Court is of the prima facie
opinion that respondent nos. 1 and 3 are veritable parties to the MoU, though
being non-signatories thereto. However, the said issue shall be finally
determined by the Arbitral Tribunal, upon a comprehensive consideration of
the evidence and materials placed before it.
36. Having prima facie held that respondent no. 1 is a veritable party to
the MoU containing the Arbitration Clause, this Court further notes that in
terms of the MoU, the amounts are ultimately payable from the office of
respondent no. 1, thus, the same provides this Court with material cause of
action to adjudicate the present petition.
37. As a sequitur to the aforesaid, since respondent no. 1 has its head
office in Delhi and, prima facie , respondent no. 1 has certain involvement in
the dispute concerning the alleged non-payment of the petitioner’s dues, this
Court is satisfied that it possesses the requisite territorial jurisdiction to
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entertain the present petition.
38. The next issue which falls for consideration before this Court is
regarding the contention raised by respondent no. 2 that the present petition
is barred by limitation.

39. In this regard, it is pertinent to note that the request for the second
instalment was made by the petitioner in the year 2017. Thereafter,
st
respondent no. 2 by its letter dated 01 May, 2018 addressed to respondent
no. 1, has acknowledged the fact that petitioner has surpassed the prescribed
milestones, and is eligible for the payments, and accordingly, recommended
the respondent no. 1 to disburse the funds.
th
40. Moreover, the annexure to the order dated 27 November, 2018
issued by respondent no. 1 further acknowledges that the recommendation
st
for release of second instalment has been forwarded vide letter dated 01
May, 2018.
th
41. The communication dated 18 May, 2020, issued by respondent no. 3,
further acknowledged that the release of funds was under process and the
requisite communication in this regard was sent to respondent no. 1.
th
Further, the letter dated 06 January, 2021 also states that the action to be
taken by the respondent no. 1 for release of funds shall be subsequent to
signing of addendum to the MoU.
th
42. Even the minutes of meeting dated 12 October, 2021 records that the
release of the outstanding payments was to be effected by respondent no. 3,
after due process.
th
43. Lastly, in its communication dated 25 February, 2025, issued by
respondent no. 2, it has once again acknowledged that the petitioner has duly
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achieved the prescribed targets under the Project, and therefore,
recommended that the outstanding amount be released in its favour.
44. Thus, the aforesaid communications demonstrate that, on multiple
occasions between the years 2018 and 2025, the respondents acknowledged
the petitioner’s request for payment and have stated that the same was under
process. Such communications, prima facie , constitute acknowledgments of
liability within the meaning of Section 18 of the Limitation Act, thereby,
giving rise to fresh cause of action and making the present petition within
the prescribed period of limitation.
45. Reliance, in this regard, is placed on the judgment passed in Paisalo
Digital Limited Versus Sat Priya Mehamia Memorial Educational Trust &
Ors., ARB. P. 396/2024 and another connected matter , wherein, this Court
has held as follows:
“xxx xxx xxx

32. A perusal of the said letter shows that for clearing of the dues, an
assurance was given by the Respondent No.1. In the opinion of this Court,
in view of Section 18 of the Limitation Act, 1963, this is an
acknowledgement of the debt and therefore, constitutes a fresh cause of
action. After considering the judgments of the Supreme Court in M/s Arif
Azim Co. Ltd (supra) and B and T AG (supra) , this position was recently
reiterated by this Court in Technical Construction Company v.
th
Engineering Project (India) Limited (Arb. P. 510/2023 decision dated 15
March, 2024). The relevant paragraphs of the said order are extracted
hereinbelow:

18. In the opinion of this Court, the acknowledgement in the said
reply, prima facie, constitutes an acknowledgment in terms of
Section 18 of the Limitation Act, 1963 and would also constitute a
fresh cause of action for the Petitioner to seek its claimed
amount. The same has been established in Food Corporation of
India v. Assam State Cooperative Marketing & Consumer
Federation Ltd., (2004) 12 SCC 360 .

xxx xxx xxx
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20. In all the three decisions cited by the Respondent, there was no
acknowledgement and only negotiations were taking place. The
relevant paragraphs of the said decisions are set out below:

i. In Vishram Varu (supra) the Supreme Court held as under:

“11. At the outset, it is required to be noted that in the
present case, work order was issued on 7.4.1982 and the
work/excess work was completed in the year 1986. Even as
per the statement of claim, the amount due and payable was
under work order dated 7.4.1982, which was executed up to
11.05.1986 and work order dated 15.01.1984 which was
executed up to 26.8.1985. Therefore, right to claim the
amount, due and payable, if any, can be said to have accrued
in the year 1985/1986. Thereafter, the correspondences
under the RTI Act had taken from the year 2012 onwards.
Thereafter, for the first time, the appellant served a legal
notice upon the General Manager, South Eastern Railway on
22.10.2018 requesting either to release the amount which
was overdue or to refer the dispute to the arbitrator under
clauses 63 & 64 of GCC under the 1996 Act. The aforesaid
legal notice is thereafter followed by three to four
letters/communications and thereafter the appellant herein
filed the present application under Section 11(6) of the 1996
Act before the High Court in the year 2019. Merely because
for the claim/alleged dues of 1985/1986, the legal notice
calling upon the respondent to pay the amount due and
payable or to refer the dispute to the arbitrator is made after
a period of approximately thirty-two years, the appellant
cannot be permitted to say that the cause of action to file the
application under Section 11(6) of the 1996 Act had accrued
in the year 2018/2019. In the present case, the legal notice
has been served and the arbitration clause is invoked and
request to appoint the arbitrator was made after a period of
approximately thirty-two years from the date of completion of
work. Therefore, the appellant, who served the legal notice
invoking the arbitration clause and requesting for
appointment of an arbitrator after a period of approximately
thirty-two years, cannot contend that still his application
under Section 11(6) of the 1996 Act be considered as the
limitation would start from the date of serving the legal
notice and after completion of 30 days from the date of
service of the legal notice and invoking arbitration clause.”

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ii . In B and T AG (supra) the Supreme Court observed as
under:
“65. On a conspectus of all the aforesaid decisions what is
discernible is that there is a fine distinction between the plea
that the claims raised are barred by limitation and the plea
that the application for appointment of an arbitrator is
barred by limitation.

xxx xxx xxx xxx xxx

67. “ Cause of action” means the whole bundle of material
facts, which it is necessary for the plaintiff to prove in order
to entitle him to succeed in the suit . In delivering the
judgment of the Board in Mussummat Chand Kour v. Partab
Singh, reported in ILR (1889) 16 Cal 98, Lord Watson
observed:

“ Now the cause of action has no relation whatever to
the defence which may be set up by the defendant, nor
does it depend upon the character of the relief prayed
for by the plaintiff it refers entirely to the grounds set
forth in the plaint as the cause of action, or in other
words to the media upon which the plaintiff asks the
court to arrive at a conclusion in his favour .”

68. Cause of action becomes important for the purposes of
calculating the limitation period for bringing an action. It is
imperative that a party realises when a cause of action
arises. If a party simply delays sending a notice seeking
reference under the Act 1996 because they are unclear of
when the cause of action arose, the claim can become time-
barred even before the party realises the same.
xxx xxx xxx xxx xxx

71. In Law of Arbitration by Justice Bachawat at p. 549,
commenting on Section 37, it is stated that subject to the Act
1963, every arbitration must be commenced within the
prescribed period. Just as in the case of actions the claim is
not to be brought after the expiration of a specified number of
years from the date when the cause of action accrues, so in
the case of arbitrations the claim is not to be put forward
after the expiration of a specified number of years from the
date when the claim accrues. For the purpose of Section
37(1) “action” and “cause of arbitration” should be
construed as arbitration and cause of arbitration. The cause
of arbitration arises when the claimant becomes entitled to
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raise the question, that is, when the claimant acquires the
right to require arbitration. An application under Section 11
of the Act 1996 is governed by Article 137 of the Schedule
to the Act 1963 and must be made within 3 years from the
date when the right to apply first accrues. There is no right
to apply until there is a clear and unequivocal denial of that
right by the respondent. It must, therefore, be clear that the
claim for arbitration must be raised as soon as the cause for
arbitration arises as in the case of cause of action arisen in
a civil action.
xxx xxx xxx xxx xxx

77. Negotiations may continue even for a period of ten years
or twenty years after the cause of action had arisen. Mere
negotiations will not postpone the “cause of action” for the
purpose of limitation. The Legislature has prescribed a limit
of three years for the enforcement of a claim and this
statutory time period cannot be defeated on the ground that
the parties were negotiating.”

iii. In M/s Arif Azim Co. Ltd (supra) the relevant observations
of the Court read:

“77. From the email communications placed on record, it
appears that due to the pre- existing disputes between the
parties in relation to the franchise agreements, the
respondent sent a demand notice to the petitioner seeking
payment of royalty and renewal fees from the petitioner. It
appears that in reply to the said notice dated 23.03.2018, the
petitioner raised the issue of payment of dues relating to the
ICCR project. Some more emails were exchanged between
the parties on the issue however it can be seen that vide email
dated 28.03.2018, the respondent clearly showed
unwillingness to continue further discussions regarding
payments related to the ICCR project. Thus, it can be said
that the rights of the petitioner to bring a claim against the
respondent were crystallised on 28.03.2018 and hence the
cause of action for invocation of arbitration can also said to
have arisen on this date. This position has also been admitted
in the Written Submission dated 05.02.2024 wherein the
petitioner has submitted as follows:

“4. The limitation for claiming the due amount would expire
on 27.03.2021....”

78. We are not impressed with the submission canvassed on
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behalf of the respondent that the cause of action for raising
the claims arose on 01.11.2017 and thus the limitation period
for invoking arbitration should commence from the said date.
The petitioner has alleged that the respondent received the
payment for the course from the ICCR on 03.10.2017.
However, the perusal of the communication exchanged
between the parties indicates that it is only on 28.03.2018
that the right of the petitioner to bring a claim against the
respondent could be said to have been crystallised. The
position of law is settled that mere failure to pay may not
give rise to a cause of action. However, once the applicant
has asserted its claim and the respondent has either denied
such claim or failed to reply to it, the cause of action will
arise after such denial or failure.

79. In B and T AG (supra) three principles of law came to
be enunciated by this Court regarding the manner in which
the point in time when the cause of action arose may be
determined. First, that the right to receive the payment
ordinarily begins upon completion of the work. Secondly, a
dispute arises only when there is a claim by one side and its
denial/repudiation by the other and thirdly, the accrual of
cause of action cannot be indefinitely postponed by
repeatedly writing letters or sending reminders. It was
further emphasised by this Court that it was important to
find out the “breaking point” at which any reasonable party
would have abandoned the efforts at arriving at a settlement
and contemplated referral of the dispute to arbitration.
Such breaking point would then become the date on which
the cause of action could be said to have commenced .

xxx xxx xxx xxx xxx

89. In the present case, the notice invoking arbitration was
received by the respondent on 29.11.2022, which is within the
three-year period from the date on which the cause of action
for the claim had arisen. Thus, it cannot be said that the
claims sought to be raised by the petitioner are ex-facie time-
barred or dead claims on the date of the commencement of
arbitration.

90. Thus, from an exhaustive analysis of the position of law
on the issues, we are of the view that while considering the
issue of limitation in relation to a petition under Section
11(6) of the Act, 1996, the courts should satisfy themselves
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on two aspects by employing a two-pronged test - first,
whether the petition under Section 11(6) of the Act, 1996 is
barred by limitation; and secondly, whether the claims
sought to be arbitrated are ex-facie dead claims and are
thus barred by limitation on the date of commencement of
arbitration proceedings. If either of these issues are
answered against the party seeking referral of disputes to
arbitration, the court may refuse to appoint an arbitral
tribunal.

xxx xxx xxx xxx xxx

95. Before we part with the matter, we would like to mention
that this Court while dealing with similar issues in many
other matters has observed that the applicability of Section
137 to applications under Section 11(6) of the Act, 1996 is a
result of legislative vacuum as there is no statutory
prescription regarding the time limit. We would again like to
reiterate that the period of three years is an unduly long
period for filing an application under Section 11 of the Act,
1996 and goes against the very spirit of the Act, 1996 which
provides for expeditious resolution of commercial disputes
within a time-bound manner. Various amendments to the Act,
1996 have been made over the years so as to ensure that
arbitration proceedings are conducted and concluded
expeditiously. We are of the considered opinion that the
Parliament should consider bringing an amendment to the
Act, 1996 prescribing a specific period of limitation within
which a party may move the court for making an application
for appointment of arbitrators under Section 11 of the Act,
1996. The Petition stands disposed of in the aforesaid terms.

21. As can be seen from the above decisions, in none of the above-
mentioned cases, was there an acknowledgement of the debt. The
above decisions also do not deal with cases where the provision of
limitation for filing of a petition in view of an express
acknowledgement provided by the parties during the stage of notice,
as per Section 18 of the Limitation Act, 1963 is raised as an issue.
Thus, the fact situation in the present case is distinguishable.

22. Section 18 of the Limitation Act, reads:

(1) Where, before the expiration of the prescribed period for a suit
or application in respect of any property or right, an
acknowledgment of liability in respect of such property or right has
been made in writing signed by the party against whom such
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property or right is claimed, or by any person through whom he
derives his title or liability, a fresh period of limitation shall be
computed from the time when the acknowledgment was so signed.

(2) Where the writing containing the acknowledgment is undated,
oral evidence may be given of the time when it was signed; but
subject to the provisions of the Indian Evidence Act, 1872 (1 of
1872), oral evidence of its contents shall not be received.

Explanation.—For the purposes of this section,—

(a) an acknowledgment may be sufficient though it omits to specify
the exact nature of the property or right, or avers that the time for
payment, delivery, performance or enjoyment has not yet come or is
accompanied by a refusal to pay, deliver, perform or permit to enjoy,
or is coupled with a claim to set off, or is addressed to a person
other than a person entitled to the property or right,

(b) the word "signed" means signed either personally or by an agent
duly authorised in this behalf, and

(c) an application for the execution of a decree or order shall not be
deemed to be an application in respect of any property or right.

23. The above-mentioned provision clearly provides that if there is
an express acknowledgement of liability in writing by the opposite
party, a fresh period of limitation shall be computed from the time
when acknowledgement was signed. The same has also been laid
down by the Supreme Court in Food Corporation of India(supra),
wherein it was held that that to amount to an acknowledgement of
liability within the meaning of Section 18 of the Limitation Act, it
need not be accompanied by a promise to pay either expressly or
even by implication . The relevant paragraphs of the said judgement
are set out below:

“14. According to Section 18 of the Limitation Act, an
acknowledgement of liability made in writing in respect of
any right claimed by the opposite party and signed by the
party against whom such right is claimed made before the
expiration of the prescribed period for a suit in respect of
such right has the effect of commencing a fresh period of
limitation from the date on which the acknowledgement was
so signed. It is well settled that to amount to an
acknowledgement of liability within the meaning of Section
18 of the Limitation Act, it need not be accompanied by a
promise to pay either expressly or even by implication .

15. The statement providing foundation for a plea of
acknowledgement must relate to a present subsisting liability,
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though the exact nature or the specific character of the said
liability may not be indicated in words. The words used in the
acknowledgement must indicate the existence of jural
relationship between the parties such as that of debtor and
creditor. The intention to attempt such jural relationship must
be apparent. However, such intention can be inferred by
implication from the nature of the admission and need not be
expressed in words. A clear statement containing
acknowledgement of liability can imply the intention to admit
jural relationship of debtor and creditor. Though oral
evidence in lieu of or making a departure from the statement
sought to be relied on as acknowledgement is excluded but
surrounding circumstances can always be considered. Courts
generally lean in favour of a liberal construction of such
statements though an acknowledgement shall not be inferred
where there is no admission so as to fasten liability on the
maker of the statement by an involved or far-fetched process of
reasoning. So long as the statement amounts to an admission,
acknowledging the jural relationship and existence of liability,
it is immaterial that the admission is accompanied by an
assertion that nothing would be found due from the person
making the admission or that on an account being taken
something may be found due and payable to the person making
the acknowledgement by the person to whom the statement is
made.”

nd
24. Adverting to the facts of this case, in the letter dated 22
February 2023, the Respondent states categorically that the amount
is payable and that the same would be paid once payment is received
from PVVNL. Considering the acknowledgment which has been
given, at this stage, the Court is unable to hold that the claims and
the petition are barred by limitation. This issue shall, however, be
adjudicated by the ld. Arbitrator after evidence is led in the matter .

xxx xxx xxx”
(Emphasis Supplied)

46. Thus, the legal position with regard to considering the aspect of
limitation at the stage of Section 11 of the Arbitration Act is that once a
party has asserted its claim for money, and the respondent has either denied
such claim or failed to reply to it, the cause of action will arise only after
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such denial or failure. Further, in view of the acknowledgments to the claims
of the petitioner by the respondents in the aforesaid correspondence, this
Court is unable to hold that the present petition is barred by limitation.
47. Accordingly, on a conspectus of the facts and circumstances of the
present case, it cannot be prima facie said that the claim of the petitioner is
barred by limitation. The issue of limitation, being a mixed question of facts
and law, is essentially within the domain of adjudication by the Arbitral
Tribunal, on the basis of the facts and evidence before it.
48. Thus, the following directions are issued:
i. Mr. Varun Chopra, Advocate, (Mobile No. 9811851711) is appointed
as the Sole Arbitrator to adjudicate the disputes between the parties.
ii. The remuneration of the Sole Arbitrator shall be in terms of Schedule
IV of the Arbitration Act.
iii. The Sole Arbitrator is requested to furnish a declaration in terms of
Section 12 of the Arbitration Act prior to entering into the reference. In
the event, there is any impediment to the Arbitrator’s appointment on that
count, the parties are given liberty to file an appropriate application before
this Court.
iv. It shall be open to the respondents to raise counter-claims, if any, in
arbitration proceedings.
v. It is made clear that all the rights and contentions of the parties,
including, the arbitrability of any of the claims and/or counter-claims, any
other preliminary objection, as well as claims on merits of the dispute of
either of the parties, are left open for adjudication by the learned
Arbitrator.
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vi. The parties shall approach the Arbitrator within two (2) weeks from
today.
49. Needless to state, nothing in this order shall be construed as an
expression of this Court on the merits of the case.

50. The present petition is disposed of in the aforesaid terms.
51. The Registry is directed to send a copy of this order to the learned
Sole Arbitrator, for information and compliance.


MINI PUSHKARNA
(JUDGE)
JULY 02, 2026
c


Signature Not Verified
Digitally Signed
By:HARIOM SHARMA
Signing Date:02.07.2026
16:40:00
ARB.P. 605/2025 Page 46 of 46