LexM/S NANDAN BIOMATRIX LIMITED versus D 1 OILS LIMITED
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[2009] 3 S.C.R. 115 M/S NANDAN BIOMATRIX LIMITED v. D 1 OILS LIMITED (Arbitration Petition No. 6 of 2007) FEBRUARY 11, 2009 [S.H. KAPADIA, J.] ARBITRATION AND CONCILIATION ACT, 1996: A B ss. 2 (1) (f), 7, 11 (5) and (9) - International commercial c arbitration -Agreement providing for submission of dispute to "institutional arbitration" - Application for appointment of arbitrator - Resisted on the grounds that the expression "institutional arbitration" being vague, the arbitration clause was void and, because of the subsequent termination D agreement, the claim stood extinguished - HELD: An arbitration agreement, as defined in s. 7, is not required to be in any particular form - Intention of parties for resolution of disputes through arbitration is relevant - In the instant case, there exists a valid arbitration agreement between the parties E - Applicant having denied genuineness of termination agreement, number of issues arise for determination and, as such, there exists a live claim between the parties - Disputes between the parties referred to Singapore International Arbitration Centre, which would nominate an arbitrator from its ~~ F The applicant was engaged in the business of seed cloning and production etc. It entered into a Supply Agreement with the respondent, Clause 15.1 whereof stipulated, "any dispute that arises between the parties G shall be resolved by submitting to the institutional arbitration in India under the provisions of the Arbitration and Conciliation Act, 1996". Thereafter, a Joint Venture Agreement was entered into between the parties" on 115 H 116 SUPREME COURT REPORTS (2009] 3 S.C.R. A 30.9.2004. It was followed by a third agreement dated 26.11.2004 called "R & D Agreement". According to the applicant, it noticed only on 24.5.2005 the existence of a termination agreement dated 16.10.2004, which was a fabricated document. A complaint was registered in this 8 regard. Since dispute arose between the parties due to respondent's non-fulfilling the obligations under the Supply Agreement, the applicant approached the Court for appointment of arbitrator. The stand of the respondent was that the Supply Agreement did not provide for c arbitration by reference to any particular institution nor did it provide for the rules framed by any particular institution and, therefore, the expression "institutional arbitration" used in Clause 15.1 of the Supply Agreement was vague and/or incapable of being made certain and, 0 as such, was void. It was further submitted that the the Joint Venture Agreement, which superseded and replaced the Supply Agreement, did not contain any arbitration clause and, in any event, by virtue of the Deed of Termination dated 16.10.2004, which was signed by the Directors of the applicant, the claim, if any, of the E applicant stood extinguished. The questions for consideration before the Court were: (1) "Whether there exists a valid arbitration agreement between the parties" and (2) "Whether there F exists a live claim between the parties". Allowing the application, the Court HELD: 1. The Arbitration and Conciliation Act, 1996, which defines 'arbitration agreement' u/s 7, does not G prescribe any form for the purpose nor does it require an arbitration agreement to be in any particular form. What is required is to gather the intention of the parties as to whether they have agreed for resolution of the disputes through arbitration. In the instant case, name of any H specific institution is not indicated in Clause 15.1 of the NANDAN BIOMATRIX LIMITED v. D 1 OILS 117 LIMITED Supply Agreement, but the parties unequivocally agreed A for resolution of the disputes through institutional arbitration and not through an ad hoc arbitration. Therefore, there exists a valid arbitration agreement between the parties in terms of clause 15.1 of the Supply Agreement dated 10.8.2004. [Para 21) [127-B] B Rukmanibai Gupta v. Collector, Jabalpur & Ors. (1980) 4 SCC 556; and M. Dayanand Reddy v. A.P. Industrial Infrastructure Corporation Limited & others - (1993) 3 SCC 137 and Bihar State Mineral Development Corporation & C Another v. Encon Builders (/) (P) Ltd. (2003) 7 SCC 418, relied on. Mis. S.B.P. & Co. v. Mis. Patel Engineering Ltd. & Anr. (2005) 8 sec 618, referred to. 2.1. The applicant has claimed compensation/ damages for supply of seeds to the non-applicant under the Supply Agreement. This is t
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