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HIGH COURT OF DELHI
Date of Decision: 24.07.2025
M/S BALAJI ENTERPRISES AND ORS. .....Appellants
Through: Mr.Sahil Mongia, Ms.Sanjana Samor & Mr.Yash Yadav, Advs
Through: Mr.Nikhil Swami, Adv
HON'BLE MS. JUSTICE MADHU JAIN NAVIN CHAWLA, J. (ORAL)
JUDGMENT
1. These appeals have been filed by the appellants, challenging the Orders dated 03.06.2025 passed by the learned District Judge (Commercial Court)-04, South West District, Dwarka Courts, Delhi (hereinafter referred to as the, ‘District Judge’) in Execution (Comm.) No. 3/2025 and Execution (Comm.) No. 4/2025, both titled Sundaram Finance Ltd. v. Balaji Enterprises, whereby the objections filed by the appellants against the execution of the Arbitral Award dated 16.08.2024 were dismissed.
2. The short question that arises for consideration in these appeals is whether the learned Arbitrator had been unilaterally appointed by the respondent, thereby rendering the Award a nullity in terms of the Judgment of the Supreme Court on this issue.
3. Before we proceed to consider the submissions of the parties on this issue, we would first reproduce the arbitration clause between the parties, as under:-
4. From the above clause, it is apparent that where any dispute arises between the parties in relation to the Agreement, the same was to be referred to a Sole Arbitrator to be nominated either by the Madras Chamber of Commerce & Industry (in short ‘MCCI’) or by the Managing Director of the lender. In the present case, the respondent admittedly did not choose the second option; instead, by notice dated 21.08.2023, they invoked the Arbitration Agreement and requested the MCCI to appoint an Arbitrator.
5. Though the learned Counsel for the appellants submits that this notice was not received by the appellants, the respondent has placed on record the Acknowledgment Due (AD) cards to show that the notice was, in fact, received by the appellants.
6. Upon receiving the said notice, the MCCI, by its notice dated 27.09.2023, appointed a Sole Arbitrator to adjudicate the disputes between the parties. This notice was also duly sent to the appellants herein. Therefore, it cannot be said that the appointment of the learned Arbitrator was unilaterally made by the respondent. On the contrary, the appointment was made by the Institution which, as per the agreement, had been earmarked by the mutual consent of the parties, as the appointing authority. Such an appointment, in terms of Section 11 of the Arbitration and Conciliation Act, 1996, would be a valid appointment and would not fall foul of Section 12(5) of the said Act.
7. We, therefore, find that the objections raised by the appellants were rightly rejected by the learned District Judge.
8. We do not find any merit in the present appeals. The same, along with the pending applications, are accordingly dismissed.
NAVIN CHAWLA, J MADHU JAIN, J JULY 24, 2025