Metric Infrastructure Pvt. Ltd. v. Seguro Foundations and Structures Pvt. Ltd.

# **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR. JUSTICE DEVAN RAMACHANDRAN** **THURSDAY, THE 2[ND] DAY OF SEPTEMBER 2021 / 11TH BHADRA, 1943** **AR NO. 55 OF 2021** ## **PETITIONER:** M/S METRIC INFRASTRUCTURE PVT.LTD HAVING ITS REGISTERED OFFICE AT XVI/43, POST OFFICE JUNCTION, POOVAN ARCADE, ARAKUZHA ROAD, MUVATTUPUZHA, ERNAKULAM-686 661, REPRESENTED BY ITS MANAGING DIRECTOR, MR. PAUL T. MATHEW. BY ADVS. SANTHOSH MATHEW ARUN THOMAS JENNIS STEPHEN KARTHIKA MARIA ANIL SEBASTIAN PULICKEL JAISY ELZA JOE ABI BENNY AREECKAL MATHEW NEVIN THOMAS KARTHIK RAJAGOPAL NANDA SANAL SANITA SABU VARGHESE MANASA BENNY GEORGE ## **RESPONDENT:** M/S SEGURO FOUNDATIONS AND STRUCTURES PVT.LTD. HAVING ITS REGISTERED OFFICE AT BUILDING NO. VII/710 E AND E1, MAVELIPURAM, THRIKKAKARA MUNICIPALITY, ERNAKULAM-682 030, REPRESENTED BY ITS DIRECTOR, MR. MOHAMMED SAGHEER. THIS ARBITRATION REQUEST HAVING COME UP FOR ADMISSION ON 02.09.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ## **A.R.No.55 of 2021 2** ## **ORDER** The petitioner is stated to be a Company, registered under the provisions of the Companies Act, 2013 and they say that they had entered into Annexure A2 agreement with the respondent – which is also a Company - for the purpose of construction of a Bridge across the Pampa River, in Alappuzha District. 2. The petitioner says that even though they had commenced and completed the work entrusted to them under the contract, several disputes have now arisen with respect to the payments and accounts; which consequently, constrained them to issue Annexure A3 notice to the respondent, seeking settlement of the same or for reference of the disputes to a sole Arbitrator, as is mandated under Clause 37(J) of the Agreement. 3. The petitioner says that even though Annexure A3 notice was accepted by the respondent, they have issued Annexure A4 reply on 07.09.2020 contesting the claims, but without speaking upon the ## **A.R.No.55 of 2021 3** requirement of referring the matter to arbitration. They say that, therefore, they preferred Annexure A5 letter on 06.03.2021, proposing the name of a Senior Advocate of this Court as the sole Arbitrator, but that this has not been responded to by the respondent until now. 4. The petitioner asserts that, therefore, they have no other option, but to approach this Court under the Arbitration and Conciliation Act, 1996 (hereinafter referred to as 'the Act' for short), seeking appointment of a sole Arbitrator in terms of Annexure A2 agreement. 5. I notice that several attempts were made by the petitioner, under the orders of this Court to serve notice on the respondent, including by deputing a special messenger. However, all such attempts have turned futile and the special messenger has reported that respondent was not available in the address shown in this case. 6. However, I notice that respondent had filed a writ petition before this Court in a matter ## **A.R.No.55 of 2021 4** unconnected to this Arbitration Request, namely W.P(C)No.35673 of 2019, in which their address has been shown to be the one cited by the petitioner in this case. Further, it has been recorded by a learned Judge of this Court in the said judgment, that the address of the respondent mentioned in Annexure A2 agreement has now changed and that the registered address is as shown in its cause title, namely, which is as reflected in this case. 7. Noticing these facts, I permitted the petitioner to take out notice by E.Mail to the respondent, as contained in the Master Data available in the office of the Registrar of Companies and they have done so, with a memo having been filed on record in substantiation. However, in spite of all these efforts, the respondent has chosen not to be present before this Court or to be represented through counsel, thus constraining me to dispose of this Arbitration Request in their absence. 8. I have examined the agreement relied upon by ## **A.R.No.55 of 2021 5** the petitioner and notice that Clause 37(J) thereof deals with settlement of disputes between the parties in the following manner:- ## “35.J. SETTLEMENT FOR DISPUTES If the dispute and/or difference whatsoever arising under the agreement or in connection there with including any question relating to existence, meaning and interpretation of the agreement or any alleged breach thereof, if not settled, the same shall be referred to an arbitrator nominated by the Employer and the disputes shall be settled in accordance with the provisions of the Arbitration & Conciliation Act, 1996.” 9. I am certainly aware that the afore extracted clause permit only the respondent to nominate an Arbitrator. However, after the judgment of the Hon'ble Supreme Court in _**TRF Ltd. v. Energo**_ _**Engineering Projects Ltd. (2017 (8) SCC 377],**_ it is indubitable that such a Clause cannot be enforced, since a party to the agreement can neither be an Arbitrator nor can they nominate one. This Court is, therefore, obligated to disregard such a stipulation in the Arbitration Clause. 10. Further, as is evident from Annexure A3, the petitioner has notified the respondent about their claims, touching upon the same agreement and they ## **A.R.No.55 of 2021 6** had responded, through Annexure A4, merely saying that they are _“following up with the Government to waive the Risk and Cost termination also has_ _approached Honourable High Court of Kerala for the rectification and release of receivable due for Seguro in this respect_ ” (sic). 11. The afore thus clearly demonstrates that the respondent also concedes to the existence of disputes between the parties, but they have chosen not to respond to Annexure A5 letter issued by the petitioner thereafter, suggesting the name of a learned Senior Counsel of this Court as the sole Arbitrator. I am, therefore, of the firm view that this Arbitration Request deserves to be allowed and I proceed to do so in the following manner: (a) I nominate Mr.Justice P.R.Ramachandra Menon, 8A, Asset East Thottekkat, TD Road, Opp. Maharaja's College, Ernakulam, PIN 682011, as the sole Arbitrator, to adjudicate and resolve the disputes and differences between the parties to ## **A.R.No.55 of 2021 7** this case arising from Annexure A2 agreement. (b) The Registry is directed to communicate a copy of this order to the learned Arbitrator within a period of one week from today and to obtain a Statement of Disclosure from him under Section 11(8) read with Section 12(1) of the Arbitration and Conciliation Act, 1996. (c) Once the Disclosure Statement is obtained from the learned Arbitrator, the Registry shall release the certified copy of this order, with a copy of the said statement appended to it, retaining the original of the same on the files of this case. - (d) The fees of the Arbitrator shall be governed by the Fourth Schedule of the Arbitration and Conciliation Act, 1996. - (e) In order to enable the Arbitrator to commence the proceedings without delay, I direct the petitioner to mark appearance before him at 11.00 a.m. on 13.10.2021. Since the respondent is **A.R.No.55 of 2021 8** remaining _ex parte_ in this proceedings, the learned Arbitrator will notify them of this date, or of a future date to be fixed by him, appropriately. ## **Sd/-** ## **DEVAN RAMACHANDRAN** **JUDGE** **MC/6.9** **A.R.No.55 of 2021 9** ## **APPENDIX OF AR 55/2021** |PETITIONER ANNEXURE|| |---|---| |Annexure A1|TRUE COPY OF THE LETTER OF ACCEPTANCE| ||DATED 01.04.2019 SENT BY THE RESPONDENT| ||TO THE PETITIONER.| |Annexure A2|TRUE COPY OF THE AGREEMENT NO. 001/2019| ||DATED 31.05.2019 (WITHOUT SCHEDULE)| ||ENTERED INTO BETWEEN THE RESPONDENT AND| ||THE PETITIONER.| |Annexure A3|TRUE COPY OF THE NOTICE DATED 03.08.2020| ||(FIRST NOTICE) SENT BY THE PETITIONER TO| ||THE RESPONDENT.| |Annexure A4|TRUE COPY OF THE REPLY DATED 07.09.2020| ||ISSUED BY THE RESPONDENT TO THE| ||PETITIONER.| |Annexure A5|TRUE COPY OF THE NOTICE OF ARBITRATION| ||DATED 06.03.2021 ISSUED UNDER SECTION 21| ||OF THE ARBITRATION AND CONCILIATION ACT,| ||1996 BY THE PETITIONER TO THE RESPONDENT.|