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2018 (3) TMI 1750 - BOMBAY HIGH COURTAppointment of a sole Arbitrator - Section 11 of the Arbitration and Conciliation Act, 1996 - denial of appointment of arbitrator on the ground that the contract is undisputedly unstamped and also on the ground that the Petitioner has not followed the mandatory pre-arbitral agreed procedure prescribed by the arbitration agreement. Whether the invocation of the arbitration was premature? - Held that:- There is no substance in the argument on behalf of the Respondent that since there was no negotiation between the parties before invoking the arbitration, the same was premature. From these text messages (sent on Whatsapp), it is quite clear that on several occasions, a request was made for a meeting to which there was no positive response. This being the case, I find that the Petitioner was fully justified in invoking the arbitration clause as contained in Annexure-III to the sub-contract dated 14th June, 2013 (the commercial terms and conditions). Whether the parties can be referred to arbitration on the basis of what the Respondent alleges is an unstamped document? - Held that:- In the facts of the present case, there is no dispute with reference to the existence of the arbitration agreement. This being the case, I find that Mr. Kamat is not correct in submitting that the dispute cannot be referred to arbitration merely because the sub-contract dated 14th June, 2013 (and in which the arbitration clause is contained), is an unstamped document - It is not as if once the Arbitrator is appointed, the Respondent is precluded from raising the issue of stamping before the Arbitrator. The Arbitrator, if found that the document is insufficiently stamped, can always impound the same and send it to the necessary authorities under the Maharashtra Stamp Act, 1958 for adjudication. The liability to pay stamp duty was that of the Respondent. If the stamp duty, if any, has not been paid by the Respondent, the Respondent cannot take advantage of its own wrong and frustrate the arbitration agreement between the parties. If I was to do that, it would be only adding premium to dishonesty. Having said this, I must make it clear that these observations are only prima facie and if the arbitrator finds that the document is in fact insufficiently stamped, and directs further action on the same, it will be for the appropriate authorities to adjudicate the stamp duty as well as who is liable to pay the same. Arbitration Petition is allowed - Mr. Mihir Naniwadekar (Advocate) is appointed as a Sole Arbitrator under Section 11 of the Arbitration and Conciliation Act, 1996 to adjudicate upon the disputes which have been arisen between the Petitioner and the Respondent herein under or in relation to and/or connected with the sub-contract dated 14th June, 2013.
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