Standard of Judicial Scrutiny under Section 11 is Confined to Prima Facie Existence of Arbitration Agreement

The Petitioner and Respondent entered into a Transport Agreement dated 22.09.2023

Following the emergence of disputes, the Petitioner invoked the arbitration clause (Clause 5) of the agreement via a Section 21 notice dated 01.04.2025

The Petitioner subsequently approached the High Court under Section 11(5) of the Arbitration and Conciliation Act, 1996, seeking the appointment of a Sole Arbitrator

The Respondent expressed no objection to the reference, provided their rights to raise legal contentions before the arbitrator were reserved

Whether a Sole Arbitrator should be appointed under Section 11 of the Act given the parties' agreement and the standard of scrutiny required at the referral stage.

The Court applied Section 11(6) and 11(6-A) of the Arbitration and Conciliation Act, 1996, which limits judicial intervention to the examination of the existence of an arbitration agreement

The Court followed the precedent set by the Seven-Judge Bench in Interplay Between Arbitration Agreements under Arbitration Act, 1996 & Stamp Act, 1899, In re and the Three-Judge Bench in SBI General Insurance Co. Ltd. v. Krish Spinning, which established that the referral court must only conduct a prima facie scrutiny of the agreement's existence and should not delve into "accord and satisfaction" or the merits of the dispute, leaving such "laborious enquiry" to the Arbitral Tribunal under Section 16

The Court noted that the parties were ad idem (in agreement) regarding the referral of the dispute to arbitration

Relying on the principles in Krish Spinning, the Court emphasized that its jurisdiction under Section 11 is "extremely circumscribed" and facilitative in nature

It reasoned that because a valid arbitration agreement exists (Clause 5) and a Section 21 notice was served, the court's role is merely to give effect to the parties' mutual intention to arbitrate

The Court declined to express any opinion on the merits, holding that all contentious factual and legal issues—including those relating to claims and counterclaims—fall within the exclusive competence of the Arbitral Tribunal to protect arbitral autonomy

The Court held that the arbitration shall be conducted per DIAC rules and the arbitrator must provide disclosures under Section 12(2) of the Act

All rights and contentions of the parties were kept open for adjudication by the learned Arbitrator