Neetu Agrawal v. GAIL (India) Ltd

1. The present Petition has been filed under Section 9 of the Arbitration and Conciliation Act, 1996 [“the A&C Act”], seeking the following reliefs:

Advisory Notice (YELLOW/RED Card), placing the Petitioner on any Watch List or Holiday List under Appendix-2 to the GCC- Services, or taking any consequential action under Clause 2.17.[3] of the GCC-Services in consequence of the impugned Notice of Termination dated 27.03.2026, pending the hearing and final disposal of the present petition;

2. Learned counsel appearing on behalf of the parties are ad idem that instead of the adjudication of the present Petition; the disputes that have arisen as between the parties may be referred to arbitration.

3. Needless to say, the Respondent will be bound by the terms of the contract and in particular, Clause 5.3B(a), which reads as follows: “B) Where Poor/Non-Performance leading to termination of contract or Offloading of contract due to poor performance attributable to Vendor/Supplier/ Contractor/Consultant (under Clause no.2.17.[3] of GCC-Services) (a) First instance: Advisory notice (Yellow Card) shall be issued and Vendor/Supplier/Contractor /Consultant shall be put on watch list for a period of Two (2) Year. Further such vendor will not be allowed to participate in the retender of the same supply/work/services of that location which has terminated / offloaded. Moreover. it will be ensured that all other action as per provision of contract including forfeiture of Contract Performance Security (CPS) etc. are undertaken. However, such vendor will be allowed to participate in all other tenders and to execute other ongoing order/ contract (s) or new contract/ order (s). The Yellow card will be automatically revoked after a period of two years unless the same is converted into Red Card due to subsequence instances of poor/ non performance in other ongoing order (s)/ contract (s) or new order (s) /contact (s) on such Vendor/ Supplier/ Contractor/ Consultant..”

4. Since the parties have mutually consented to the adjudication of their disputes by way of Arbitration, this Court is of the view that the commencement of arbitral proceedings to adjudicate the disputes between the parties should not be unduly delayed. Accordingly, in the peculiar facts of the present case, the requirement of Section 21 notice and initiation of separate proceedings under Section 11 of the A&C Act are dispensed with, with the consent of the parties.

5. In view thereof, this Court is of the view that the matter may be referred to arbitration by a Sole Arbitrator for the purpose of the adjudication of the disputes between the parties.

6. Material on record reflects that the valuation of the subject matter of the disputes is stated to be approximately Rs. 2.[5] Crores/-

7. Accordingly, this Court hereby requests Ms. Asha Menon (Retd.) (Former Judge of Delhi High Court) to enter upon the reference and adjudicate the disputes inter se the parties.

8. The learned Sole Arbitrator may proceed with the arbitration proceedings, subject to furnishing to the parties the requisite disclosures as required under Section 12(2) of the A&C Act within a week of entering the reference.

9. The Registry is directed to forward a copy of this order to the learned Arbitrator through all permissible modes, including electronic means.

10. The learned Arbitrator shall be entitled to a fee in accordance with the Fourth Schedule of the A&C Act or as may otherwise be agreed to between the parties and the learned Arbitrator.

11. The parties shall share the learned Arbitrator’s fee and arbitral costs equally.

12. All rights and contentions of the parties are kept open, to be decided by the learned Sole Arbitrator on their merits, in accordance with law.