Section 11 Judicial Scrutiny is Confined to Prima Facie Examination of Arbitration Agreement Existence Only

The Petitioner and Respondent entered into a Hotel Management Agreement on 28.08.2024, which contained an arbitration clause (Clause 13) designating New Delhi as the seat.

Disputes arose, and the Petitioner issued a notice under Section 21 of the Arbitration and Conciliation Act, 1996, on 06.05.2026, which the Respondent refused on 10.05.2026.

The Petitioner subsequently moved the High Court under Section 11(6) for the appointment of an arbitrator and under Section 9 for interim reliefs.

During the proceedings, the Respondent expressed no objection to the referral.

1. Whether a Sole Arbitrator should be appointed under Section 11(6) of the Act given the existence of the arbitration agreement.

2. Whether the Section 9 petition for interim relief should be adjudicated by the Court or referred to the Arbitral Tribunal under Section 17.

The Court applied Section 11(6) of the Arbitration and Conciliation Act, 1996, regarding the appointment of arbitrators, and Section 9 regarding interim measures.

The Court relied heavily on the precedent set by the Supreme Court in SBI General Insurance Co. Ltd. v. Krish Spinning, which established that judicial intervention under Section 11 is confined strictly to a prima facie examination of the existence of the arbitration agreement.

The Court also referenced Interplay Between Arbitration Agreements under Arbitration Act, 1996 & Stamp Act, 1899, In re, noting that issues like "accord and satisfaction" or "ex facie frivolity" are within the exclusive domain of the Arbitral Tribunal under the principle of competence-competence.

The Court observed that the scope of judicial scrutiny at the Section 11 stage is "extremely circumscribed" and facilitative.

Since the parties reached a consensus on the referral and the statutory mandates (existence of a written agreement and Section 21 notice) were satisfied, the Court found no impediment to appointing an arbitrator.

The Court reasoned that any contested facts or legal contentions regarding the merits should be left to the Tribunal to ensure minimal judicial interference and uphold arbitral autonomy.

Regarding the Section 9 petition, the Court determined that since an arbitrator was being appointed, the application for interim relief should be handled by the Tribunal to promote efficiency.

The Court ordered that the Section 9 petition be treated as an application under Section 17 to be adjudicated by the learned Arbitrator upon entering the reference.

All rights and contentions of the parties were kept open for the Tribunal’s determination.