Section 11 Inquiry Is Confined to the Prima Facie Existence of an Arbitration Agreement

The parties entered into a Business Centre Agreement dated 1 July 2024, under which the respondent took Business Suite No. S-4 at the petitioner’s Chennai business centre and was required to pay licence fees and other charges.

The petitioner alleged that the respondent failed to pay outstanding contractual dues despite reminders and invoked the arbitration clause by notice dated 13 August 2025 under Section 21 of the Arbitration and Conciliation Act, 1996.

The respondent did not file a reply or appear at the hearing, despite having been granted time to do so; the Court proceeded ex parte.

1. Whether the Court should appoint a sole arbitrator under Section 11(6) of the Arbitration and Conciliation Act, 1996, where the agreement contains an arbitration clause and the respondent did not participate in the petition.

2. Whether the parties’ disputes should be referred to arbitration, with any objections to arbitrability or jurisdiction left for the arbitrator to decide.

Under Section 11 of the Arbitration and Conciliation Act, 1996, the Court’s enquiry at the appointment stage is confined to examining the prima facie existence of an arbitration agreement, applying SBI General Insurance Co. Ltd. v. Krish Spinning, 2024 SCC OnLine SC 1754.

Section 12(2) requires the appointed arbitrator to furnish the requisite disclosure.

The arbitration clause provided for a mutually appointed sole arbitrator and specified arbitration in Gurgaon, in English, under the Act.

The Court also left objections concerning arbitrability and jurisdiction open for determination by the arbitrator.

The Court found that the respondent had sufficient notice of the petition but neither filed a reply nor appeared, and therefore proceeded ex parte.

It identified no dispute regarding the existence of a valid arbitration agreement and, applying the limited prima facie enquiry under Section 11, found no impediment to appointing a sole arbitrator.

The Court left all pleas, including objections to arbitrability and jurisdiction, to be decided by the arbitrator in accordance with law.

The arbitration was directed to proceed under the aegis of the Delhi International Arbitration Centre, with fees as per its schedule; the arbitrator was to enter upon the reference within three weeks and furnish the required Section 12(2) disclosure within three weeks of entering upon it.

The arbitrator was to decide the claims and counterclaims independently, uninfluenced by the Court’s observations.