TMI Blog2024 (3) TMI 908X X X X Extracts X X X X X X X X Extracts X X X X ..... tained in the tender issued by the DVC to the NBCC shall apply mutatis mutandis except where these have been expressly modified by the NBCC. Clause 7.0 specifically provides that the redressal of dispute between the NBCC and the respondent shall only be through civil courts having jurisdiction of Delhi alone. Clause 10.0 further provides that the L.O.I. shall also form a part of the agreement - the intention between the parties is very clear. Clause 7.0 of the L.O.I. which also forms part of the agreement specifically provides that the redressal of the dispute between the NBCC and the respondent shall only be through civil courts having jurisdiction of Delhi alone. It is pertinent to note that Clause 7.0 of the L.O.I. specifically uses the word only before the words be through civil courts having jurisdiction of Delhi alone . When there is a reference in the second contract to the terms and conditions of the first contract, the arbitration clause would not ipso facto be applicable to the second contract unless there is a specific mention/reference thereto - the present case is not a case of incorporation but a case of reference . As such, a general reference would not have the effe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a, vide Letter of Intent No. AGM/RAN/CTPS-AWARD/06/1660 dated 4th December 2006, the appellant awarded the contract for Construction of the Weir to the respondent for a total value of Rs. 19,08,46,612/-. 3.6 With the passage of time, certain disputes arose between the parties to the present lis as a result, the respondent issued a notice dated 6th March 2020, in terms of Clause 3.34 of Section III Volume II of the Tender Documents (GCC), thereby invoking arbitration and further seeking consent of the appellant for the appointment of a former Judge of a High Court, as Sole Arbitrator. 3.7 The appellant did not respond to the aforementioned notice invoking arbitration, so the respondent filed an application at the High Court under Section 11(6) of the Arbitration Act. 3.8 Vide interim order dated 12th March 2021, the High Court allowed the Arbitration Petition and proposed the appointment of a former Judge of the High Court, as the Sole Arbitrator, to adjudicate the dispute between the parties. 3.9 Vide final judgment order dated 9th April 2021, the High Court confirmed the proposed appointment of the former Judge of the Delhi High Court, as the Sole Arbitrator. 3.10 Aggrieved by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ited vs. Som Datt Builders Limited (2009) 7 SCC 696 , he submits that unless the L.O.I. specifically provides for incorporation of the arbitration clause, a reference to the arbitration proceedings would not be permitted in view of the provisions of sub-section (5) of Section 7 of the Arbitration Act. 7. Shri Sumit Kumar, learned counsel appearing for the respondent, on the contrary, submits that there is a specific reference in Clause 2.0 of the L.O.I. to the terms and conditions in the tender issued by the DVC to the NBCC. He submits that the only modification is that under Clause 3.34 of the Additional Terms Conditions of Contract, the jurisdiction is vested with the Court in the City of Kolkata only, whereas in the L.O.I. the jurisdiction would be vested in the civil courts having jurisdiction of Delhi alone. It is submitted that the learned single judge of the Delhi High Court has rightly considered this aspect and as such, no interference would be warranted in the impugned order. 8. Sub-section (5) of Section 7 of the Arbitration Act reads thus: 7. Arbitration Agreement.-1) . xxx xxx xxx (5) The reference in a contract to a document containing an arbitration clause constitute ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nditions, shall be deemed to be incorporated by reference. Sometimes the contract may also say that the parties are familiar with those terms and conditions or that the parties have read and understood the said terms and conditions. (v) Where the contract between the parties stipulates that the conditions of contract of one of the parties to the contract shall form a part of their contract (as for example the general conditions of contract of the Government where the Government is a party), the arbitration clause forming part of such general conditions of contract will apply to the contract between the parties. 10. It could thus be seen that this Court has held that when the parties enter into a contract, making a general reference to another contract, such general reference would not have the effect of incorporating the arbitration clause from the referred document into the contract between the parties. It has been held that the arbitration clause from another contract can be incorporated into the contract (where such reference is made), only by a specific reference to arbitration clause. It has further been held that where a contract between the parties provides that the executio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Private Limited (supra). In the said case (i.e. Inox Wind Limited), this Court has held that though general reference to an earlier contract is not sufficient for incorporation of an arbitration clause in the later contract, a general reference to a standard form would be enough for incorporation of the arbitration clause. Though this Court in the case of Inox Wind Limited (supra) agrees with the judgment in the case of M.R. Engineers and Contractors Private Limited (supra), it holds that general reference to a standard form of contract of one party along with those of trade associations and professional bodies will be sufficient to incorporate the arbitration clause. In the said case (i.e. Inox Wind Limited), this Court found that the purchase order was issued by the appellant therein in which it was categorically mentioned that the supply would be as per the terms mentioned therein and in the attached standard terms and conditions. The respondent therein by his letter had confirmed its acceptance. This Court found that the case before it was a case of a single-contract and not two-contract case and, therefore, held that the arbitration clause as mentioned in the terms and condit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the laws enforceable in India. 10.0 This letter of intent shall also form a part of the agreement. 20. In view of Clause 1.0, the documents stated therein shall also form part of the agreement. In view of Clause 2.0, all terms and conditions as contained in the tender issued by the DVC to the NBCC shall apply mutatis mutandis except where these have been expressly modified by the NBCC. Clause 7.0 specifically provides that the redressal of dispute between the NBCC and the respondent shall only be through civil courts having jurisdiction of Delhi alone. Clause 10.0 further provides that the L.O.I. shall also form a part of the agreement. 21. It is thus clear that the intention between the parties is very clear. Clause 7.0 of the L.O.I. which also forms part of the agreement specifically provides that the redressal of the dispute between the NBCC and the respondent shall only be through civil courts having jurisdiction of Delhi alone. It is pertinent to note that Clause 7.0 of the L.O.I. specifically uses the word only before the words be through civil courts having jurisdiction of Delhi alone . 22. As already discussed herein above, when there is a reference in the second contract ..... X X X X Extracts X X X X X X X X Extracts X X X X
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