M/S TRANS ASIAN SHIPPING SERVICES (PVT.) LTD. versus M/S BEACON SHIPPING LINES LTD. REPRESENTED BY MR. MOHAMMED S. ASLAM MANAGING DIRECTOR & OTHERS

Citation: [2018] 11 S.C.R. 687 · Decided: 19-09-2018 · Supreme Court of India · Bench: DIPAK MISRA · Disposal: Appeal(s) allowed
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Judgment (excerpt)

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M/S TRANS ASIAN SHIPPING SERVICES (PVT.) LTD.
v.
M/S BEACON SHIPPING LINES LTD. REPRESENTED BY MR.
MOHAMMED S. ASLAM MANAGING DIRECTOR & OTHERS
(Arbitration Petition (Civil) No. 20 of 2012)
SEPTEMBER 19, 2018
[DIPAK MISRA, CJI, A. M. KHANWILKAR AND
DR. D. Y. CHANDRACHUD, JJ.]
Arbitration and Conciliation Act, 1996 – s.11(9) – Appointment
of arbitrator under – Agency Agreement between the petitioner and
the respondent – Petitioner asserting breach of various terms and
conditions of the agreement by the respondent, sought appointment
of a sole arbitrator – Held: An arbitration clause exists in the
Agreement which stipulates that any dispute or difference arising
under and/or out of or in connection with and/or relating to the
Agreement unless amicably settled, shall be determined by arbitration
– Disputes have arisen and remain unsettled – Justice Gyan Sudha
Misra, former Judge of Supreme Court, appointed as the arbitrator
to determine the dispute between the parties.
CIVIL ORIGINAL JURISDICTION: Arbitration Petition (Civil)
No. 20 of 2012
Under Section 11(6) of the Arbitration and Conciliation Act, 1996
for the purposes of appointment of Arbitrator under Cl.5(1) of the Agency
Agreement dated 31.03.2010.
C. N. Sree Kumar, Ms. Rasmita Chandarn, Amit Sharma, Advs.
for the petitioner.
The Order of the Court was passed by
DIPAK MISRA, CJI 1. The petitioner, by this petition under
Section 11(9) of the Arbitration and Conciliation Act, 1996 (for brevity,
‘the Act’), has prayed for appointment of arbitrator as per Clause 5(1)
of the Agency Agreement dated 31.03.2010 between M/s Trans Asian
Shipping Services (Pvt.) Ltd. and M/s Beacon Shipping Lines Ltd.
[2018] 11  S.C.R. 687
687
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SUPREME COURT REPORTS
[2018] 11 S.C.R.
2. The petitioner is an Indian company and the respondent company is
registered in Bangladesh. It is averred that the petitioner is a multinational
company having operations in the Indian Sub-Continent, Middle East
and South East Asia and is actively engaged in diversified activities with
its core business being shipping especially transportation of containerized
cargo. Its activities are related to various shipping operations all over the
world and, therefore, it engages agents in various countries to undertake
for and on behalf of it such functions. It involves their combined transport
operations in the name of “Trans Asia Line”. It is urged that the valid
subsisting agreement renewed from 31st March, 2010 was terminated
only on 31st March, 2012 with respect to the combined transport
operations.  It is asserted that the respondent committed breach of
various terms and conditions of the agency agreement leading to disputes
between the parties. The petitioner is entitled to recover dues of USD
134875.8829. Various documents have been filed to show how the amount
is due.  It is asserted that though the petitioner company sent arbitration
notice to the respondent requesting the latter to nominate the arbitrator
within 15 days of the receipt of the same so that the arbitration board
could deal with the disputes, yet there was no response from the
respondent. Under these circumstances, the petitioner has prayed for
appointment of a sole arbitrator.
3. Despite service of notice, there has been no appearance on
behalf of the respondent no. 1 and other respondents who are the
Managing Directors and Directors of the respondent no. 1 company.
4. We have heard Mr. C.N. Sree Kumar, learned counsel for the
petitioner. Learned counsel has drawn our attention to Clauses 18 and
19 of the agreement. The said Clauses read as under:-
“18. GOVERNING LAW
This Agreement shall be governed by and construed in accordance
with the Indian Law.
19. DISPUTES AND ARBIRATION
Any dispute or difference arising under and or out of or in
connection with and/or relating to this Agreement, which cannot
be settled amicably between the parties, shall be determined by
arbitration and shall be governed by the law of India.  Each party
shall appoint one arbitrator with power to such arbitrators to
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appoint, if necessary, an umpire.  The language for arbitration
shall be English, and shall be governed by the Indian Law.”
5. On a perusal of the aforesaid Clauses, there can be no trace of
doubt that an arbitration clause exists and the same clearly stipulates
that any dispute or difference arising under and/or out of or in connection
with and/or relating to the Agreement unless amicably settled sha
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