SUPREME INDUSTRIES LIMITED Vs. INTERNATIONAL INDIA

JUDGEMENT

(1.) The present application has been filed for appointment of an arbitrator under Section 11(5) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the Act) for adjudicating the disputes having arisen between the parties out of an agreement/contract dated 14th January, 1992 for the sale of plastic molded furniture in the states of Haryana, Punjab, Jammu and Kashmir, Rajasthan, Uttar Pradesh, Himachal Pradesh and Union Territories of Delhi and Chandigarh. The respondent M/s.Intermolde India was appointed as the main dealer of the applicant company. The respondent was at liberty to appoint sub-dealers in the region allotted to it for the sale of furniture and at the request of the respondent the applicant was to dispatch the plastic moulded furniture directly to the sub-dealers/sister firms of the respondent for convenience. The respondent was entitled to trade discount as per the terms of the agreement. The applicatnt was maintaining running account of the respondent. In December, 1995, it was found that a sum of Rs.41,40,277/- was outstanding in the respondent's account including the outstandings of their sub-dealers/sister firms, namely, M/s.Ankit Travels, M/s.perfect Marketing, M/s.Poly-Fum and M/s.Veecon Trading. The applicant requested the respondent to deal the outstanding dues. Correspondence was exchanged between the parties and an effort was made to settle the accounts as the respondent had failed to clear the outstandings. The applicant cancelled the dealership agreement vide its letter dated 16th April, 1996. It served the respondent with a legal notice to which the respondent replied on 2nd April, 1997 alleging that the applicant had committed the breach of the contract. It set up a counter claim, but in me alternative called upon the applicant to give its consent for appointment of an arbitrator in terms of the arbitration Clause incorporated in the agreement.

(2.) The applicant was ready and wiling for reference of disputes for arbitration but on account of absence of procedure for appointment of an arbitrator in me agreement and the fact that the parties failed to agree on the name of an arbitrator the present application was filed. The dealership agreement contained the following arbitration Clause.:-

(3.) This Court at present need not dilate on the detailed facts of the case as the short prayer in the application is for me appointment of an arbitrator and referring to him all the disputes having arisen between the parties for adjudication. The respondent contests the application inter-alia on the grounds, that the Courts at Delhi have no jurisdiction to entertain the present application, the applicant has not complied with the provisions of Section 11(2) and 11(5) of the Act, and the respondent has nothing to do with the four sub-dealers/sister firms.