DLF HOME DEVELOPERS LIMITED versus RAJAPURA HOMES PRIVATE LIMITED & ANR. on 22 September 2021

[2021] 12 S.C.R. 1

DLF HOME DEVELOPERS LIMITED

v.

RAJAPURA HOMES PRIVATE LIMITED & ANR.

(Arbitration Petition (Civil) No. 17 of 2020)

SEPTEMBER 22, 2021

[N.V. RAMANA, CJI AND SURYA KANT, J.]

Arbitration and Conciliation Act, 1996 – s.11(6) r/w s.11(12)– Appointment of Arbitrator – In terms of Share PurchaseAgreements, the parties entered into Construction ManagementAgreements – Both sets of agreements contained arbitration clausesnot similar to one another – Disputes arose – Respondents refusedto appoint Arbitrator under the Construction ManagementAgreements – Present petitions filed by the Petitioner for appointmentof a sole arbitrator for resolution of all disputes arising from theConstruction Management Agreements – Held: Notwithstandingcertain overlaps between the Share Purchase Agreements andConstruction Management Agreements, their object and field ofoperation is different and distinct – It cannot be accepted outrightlythat the respective Share Purchase Agreements are the ‘principalagreements governing the transaction’ between the parties or thatthe present disputes can be resolved solely under the arbitrationclause contained therein – Neither party pleaded the infringementof the core provisions of the said Agreements, thus it cannot beaccepted that the subject controversy falls within the ambit of Clause9 thereof and can be adjudicated only under the rules of SingaporeInternational Arbitration Centre (SIAC), with seat and venue atSingapore – Further, parties have neither denied that there is noarbitrable dispute between them nor have they challenged theexistence of the arbitration clause(s) in the ConstructionManagement Service Agreements – The nature of disputes that havearisen between the parties can thus, be adjudicated in the arbitralproceedings u/Clause 11 of the Construction ManagementAgreements – Primary twin-test u/s.11(6) satisfied by the Petitioner– Sole arbitrator appointed to resolve all disputes between theparties.

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AArbitration and Conciliation Act, 1996 – ss.11, 11(6-A) –Scope of interference by Court at the stage of referral – Held: Courtsare obliged to apply their mind to the core preliminary issues withinthe framework of s.11(6-A) – Thus, even when an arbitrationagreement exists, it would not prevent the Court to decline a prayerfor reference if the dispute does not correlate to the said agreementB– Arbitration and Conciliation (Amendment) Act, 2015 – Arbitrationand Conciliation (Amendment) Act, 2019 – s.11(6-A).

Allowing the petitions, the Court

HELD 1. The jurisdiction of this Court under Section 11 isCprimarily to find out whether there exists a written agreementbetween the parties for resolution of disputes through arbitrationand whether the aggrieved party has made out a prima faciearbitrable case. The limited jurisdiction, however, does notdenude this Court of its judicial function to look beyond the bareexistence of an arbitration clause to cut the deadwood. This CourtDor a High Court, as the case may be, are not expected to actmechanically merely to deliver a purported dispute raised by anapplicant at the doors of the chosen Arbitrator. On the contrary,the Court(s) are obliged to apply their mind to the core preliminaryissues, albeit, within the framework of Section 11(6-A) of the Act.ESuch a review is not intended to usurp the jurisdiction of theArbitral Tribunal but is aimed at streamlining the process ofarbitration. Therefore, even when an arbitration agreement exists,it would not prevent the Court to decline a prayer for reference ifthe dispute in question does not correlate to the said agreement.[Paras 18, 19][14-B-C; 16-A-C]F

2.1 In terms of Clauses 3.1, 6.1 and 6.2 of Share PurchaseAgreements, the parties entered into two ConstructionManagement Service Agreements dated 25.01.2017. The ‘SharePurchase Agreements’ as well as the ‘Construction ManagementAgreements’ are subsisting and have not been repudiated by theGParties. Both sets of agreements contain arbitration clauses thatare not similar to one another. Upon perusing the Share PurchaseAgreements, it is clear that the primary purpose of theseagreements is to effectuate the change of ownership ofRespondent No.1 and the Begur Company from DHDL to H

Resimmo PCC. The Rajapura SPA and the Southern Homes SPAas per their Clause 6.1 and 6.2, do provide for the completion ofthe respective residential projects as a post-closing obligation,however, these construction obligations had to be fulfilled inaccordance with the terms of the ‘Construction Agreements’.The very purpose of the RCMA and SCMA was, on the otherhand, to operationalise the manner in which the Petitioner-DHDLwould achieve the said construction related obligations. Theconstruction agreements not only contemplate the scope ofservices to be provided by the petitioner but also lay down theobligation on Respondent No.2 to pay “Fee” to the Petitioner-DHDL upon completion of the residential projects. A prima faciereading of ‘Share Purchase Agreements’ and `ConstructionManagement Agreements’, does suggest that notwithstandingcertain overlaps between these agreements, their object and fieldof operation is different and distinct in nature. It is thereforedifficult to accept it outrightly that the respective Share PurchaseAgreements are the ‘principal agreements governing thetransaction’ between the parties or that the present disputes canbe resolved solely under the arbitration clause contained therein.[Paras 24-26][20-D-E; 23-B-G]

2.2 The dispute sought to be referred to arbitration by thePetitioner DHDL pertains to non-deposit of agreed amount byRespondent No.2 and resultant payment thereof as ‘Fee’ whichthe Petitioner claims in terms of clause 4 of RCMA/SCMA.Whether or not the Petitioner has complied with the ‘conditionprecedent’ under Rajapura SPA and thus has become entitled to‘fee’ as per clause referred to above, is purely a question of factto be determined by the Arbitral Tribunal. The arbitration Clause9 of the Rajapura SPA/Southern Homes SPA does not have anyoverriding effect and is in no way broader or wider when comparedto Clause 11 of the RCMA/SCMA. Therefore, even if it isassumed that the present differences between the parties areincidental to the terms of the Share Purchase Agreements, it isdifficult to construe that Clause 9 of Share Purchase Agreementscontemplates adjudication of the issues that are “connected with”or are “in relation” to the subject matter of the Share PurchaseAgreements. [Paras 27, 29][23-H; 24-A-B, E-G]

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[2021] 12 S.C.R.

AOlympus Superstructure Pvt. Ltd. v. Meena VijayKhetan and Others (1999) 5 SCC 651: [1999] 3 SCR490 – distinguished.

2.3 If the Respondent(s) plea, that present dispute(s) shouldbe arbitrated only under the Rajapura SPA/Southern Homes SPABis accepted at face value, the eventual result would be that anyand all disputes relating to the Petitioner’s construction obligationwould be arbitrable under the provisions of the Share PurchaseAgreements only. But then, what would be the purpose of havinga separate arbitration clause 11 under the RCMA/SCMA? Theparties do not seem to have rendered the arbitration clause inCRCMA and SCMA as redundant, more so when these are theagreements later in time. The scope of the arbitration clause inRajapura SPA/Southern Homes SPA is limited to issues relatingto the agreement’s primary subject matter, i.e., any dispute arisingout of the transaction of sale and purchase of shares. The

Dprovisions of the RCMA/SCMA, and the arbitration clausetherein, would as a logical corollary then be applicable to anydispute/difference concerning the performance of the constructionrelated obligations and deposit of agreed amount by RespondentNo.2 or payment thereof to the Petitioner-DHDL. The Petitionerhas not once alleged in these Petitions that the dispute sought toEbe referred to Arbitration emanates from the Share PurchaseAgreements. As far as the share transactions between thePetitioner and Respondent No.2 is concerned, it has beenunequivocally submitted on behalf of the Petitioner that thepurchase of shares by Respondent No.2 has been duly completed.

FThere is nothing on record to suggest that Respondent No.2 isaggrieved by non-compliance, deviation or breach of promise tosell its shares by the Petitioner-DHDL. On the contrary, thecounter-affidavit filed by the Respondent(s) indicates that the saleof the shares of Respondent No.1 and the Begur Company havebeen completed. Still further, it is not the case that Ressimo PCCGhas already invoked Clause 9 of the Rajapura SPA or of theSouthern Homes SPA. Thus, when neither party has pleaded theinfringement of the core provisions of the Share PurchaseAgreements, it is difficult to accept outrightly that the subject-controversy falls within the ambit of Clause 9 of the saidH

agreements and can be adjudicated only under the rules of SIAC,with seat and venue at Singapore. [Paras 30, 31][24-G-H;25-A-F]

2.4 The Parties have neither denied that there is no‘arbitrable dispute’ between them nor have they challenged theexistence of the arbitration clause(s) in the ConstructionManagement Service Agreements. The primary twin-testenvisioned under Section 11(6) of the Act has been satisfied bythe Petitioner-DHDL, thus the instant application(s) aremaintainable. The nature of disputes that have arisen betweenthe parties, thus, can be adjudicated in the arbitral proceedingsunder Clause 11 of the RCMA and SCMA. The RCMA andSCMA, though interlinked and connected, are still two separateagreements. If on appreciation of the facts and law, the arbitratorfinds that the ‘real dispute’ between the parties stems from theShare Purchase Agreements, the arbitrator shall be free to windup the proceedings with liberty to the Parties to seek redressalunder the rules of Singapore International Arbitration Centre(SIAC). The case of the Respondent(s) is that the Petitioner hascommitted breaches under both RCMA as well as SCMA, andthat the genesis of the disputes lies in separate and distinct facts.Save where the parties have resolved to the contrary, it would beinappropriate to consolidate the proceedings originating out oftwo separate agreements. However, since the Fee Agreementprovides that the “Fee” can only be calculated after taking intoconsideration various financial components of both the RajapuraHomes Projects and the Southern Homes Project, it would benecessary for the sake of avoiding wastage of time and resources,and to avoid any conflicting awards, that the disputes underArbitration Petition No.17 and Arbitration Petition No.16 arereferred to a sole Arbitrator. Sole arbitrator appointed to resolveall disputes/differences between the parties. [Paras 32, 33, 35and 36][25-F-H; 26-A-B; E-H]

Duro Felgura, S.A. v. Gangavaram Port Limited (2017)9 SCC 729 : [2017] 10 SCR 285; Garware Wall RopesLimited v. Coastal Marine Constructions andEngineering Limited (2019) 9 SCC 209 : [2019] 5 SCR579; Mayavati Trading Private Limited v. Pradyuat Deb AB

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ABurman (2019) 8 SCC 714 : [2019] 12 SCR 123; VidyaDrolia and Others v. Durga Trading Corporation (2021)2 SCC 1 : 2021 (6) JT 460; Uttarakhand Purv SainikKalyan Nigam Limited v. Northern Coal Field Limited(2020) 2 SCC 455; P.R. Shah, Shares and Stock BrokersPrivate Limited v. BHH Securities Private Limited andBOthers (2012) 1 SCC 594 : [2011] 16 SCR 87; IndusBiotech Private Limited v. Kotak India Venture(Offshore) Fund and Ors 2021 SCC Online SC 268 –referred to.

Case Law Reference

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CIVIL ORIGINAL JURISDICTION: Arbitration Petition (Civil)No.17 of 2020.

Petition under section 11(6) read with section 11(12) of theEArbitration and Conciliation Act, 1996, for Appointment of Sole Arbitrator.

With

Arbitration Petition (Civil) No. 16 of 2020.

Dr. A. M. Singhvi, Sr. Adv., Amit Dhingra, Shivam Kumar Raheja,FAmit Bhandari, Pranav Kamnani, M/s Dua Associates, Advs. for thePetitioner.

Nikhil Nayyar, Sr. Adv., Gyandendra Kumar, Ms. Shikha Tandon,Robin Grover, Ms. Shree Sinha, Sumit Attri, M/s Cyril AmarchandMangaldas, Advs. for the Respondents.

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The Judgment of the Court was delivered by SURYA KANT, J.

1. The Petitioner DLF Home Developers Limited (hereinafter,“DHDL”) has filed Arbitration Petition No. 16 of 2020 and Arbitration H

Petition No. 17 of 2020 under Section 11(6) read with Section 11(12) ofthe Arbitration and Conciliation Act, 1996 (hereinafter, “Act”) forappointment of sole arbitrator to adjudicate the differences between theparties that have arisen out of the two Construction ManagementAgreements dated 25.01.2017.

FACTS

2. DHDL is a limited liability involved in the business of providingdevelopment, management, and investment services concerning realestate projects. The Petitioner and one Ridgewood Holdings Limitedentered into a joint venture, in the year 2007-2008, wherein RidgewoodHoldings Limited invested in four Special Purpose Vehicles, includingRajapura Homes Private Limited (Respondent No.1 in ArbitrationPetition No.17 of 2020; hereinafter, “Respondent No.1”) and Begur OMRHomes Private Limited (Respondent No.1 in Arbitration Petition No.16of 2020; in short “Begur Company”), for developing residential projectsin various cities across India. Respondent No.1 is a company engaged inthe construction, development, operations, and maintenance of residentialprojects, namely, ‘DLF Maiden Heights’ and ‘DLF Woodland Heights,’both of which are in Bangalore, Karnataka (collectively called “RajapuraProject”). Similarly, the Begur Company is engaged in the business ofconstruction, development, operations, and maintenance of residentialprojects, namely, ‘DLF Garden City’ situated at Kanchipuram District,Tamil Nadu, and ‘DLF Westend Heights’ situated in Bengaluru District,Karnataka (collectively called “Southern Homes Project”).

3. In June 2008, Ridgewood Holdings Limited transferred its stakein the joint venture to its affiliates, Resimmo PCC (in short, “RespondentNo.2”) in both the Petitions and Clogs Holding BV (hereinafter, “Clogs”).Thereafter, in terms of the arrangement, upon expiry of the exit period,Respondent No.2 and Clogs were inter alia entitled to a put option onthe Petitioner, which they exercised from January to May 2014. However,the Petitioner was unable to provide an exit to Respondent No.2 andClogs. Subsequently, in 2015, the parties agreed to a negotiated settlement,in terms of which, Respondent No.2 was to acquire sole ownership andcontrol of two Special Purpose Vehicles, namely, Respondent No.1 andthe Begur Company. It may be noted that Respondent No.2 is a companyincorporated under the laws of Mauritius and is engaged in the businessof providing investment management services.

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A4. To effect the change of ownership of the First Respondent, thePetitioner, Respondent No.1, and Respondent No.2 executed a SharePurchase Agreement dated 08.07.2016 (hereinafter, “Rajapura SPA”)for the transfer of Petitioner’s entire shareholding in Respondent No.1to Respondent No.2. Likewise, a Share Purchase Agreement dated25.01.2017 was also executed between the Petitioner, the BegurBCompany and Respondent No.2 to transfer the Petitioner’s entire holdingin the Begur Company to Respondent No.2 (hereinafter, “Southern HomesSPA”). While the primary subject matter of the Share PurchaseAgreements was the transfer of shares from the Petitioner – DHDL toRespondent No.2, both the Share Purchase Agreements also stipulatedCcertain additional obligations that would have to be undertaken by thePetitioner. Clause 3.1 read with Schedule-II of the agreementscontemplated that the parties were to execute a constructionmanagement agreement as a ‘condition precedent’ to the closing of thetransactions. Further, in terms of Clause 6 of the respective agreements,the Petitioner had to undertake certain construction related obligations,Dwhich were to be performed “in accordance with the terms of theConstruction Agreement”. We may note that both the Share PurchaseAgreements also contained an arbitration clause which are identical.Clause 9 of the agreements contemplate that all disputes arising out ofthe contract shall be submitted for arbitration at the request of the parties.EThe arbitration is to be conducted in accordance with the rules of theSingapore International Arbitration Centre (hereinafter, “SIAC”), withthe seat and venue of the arbitration being Singapore.

5. Thus, in terms of the agreement and in pursuance of theconstruction obligations under the Rajapura SPA and the Southern HomesFSPA, the Parties on 25.01.2017 executed the DLF-Rajapura HomesConstruction Management Services Agreement (hereinafter, “RCMA”)and the DLF-Southern Homes Construction Management ServicesAgreement (hereinafter, “SCMA”). Under the RCMA, the Petitionerwas to provide, inter alia, construction management services toRespondent No.1 for completion of the Rajapura Homes Project and inGconnection with the handover of sold units of the Rajapura Homes Project.Likewise, under the SCMA, the Petitioner had to provide similar servicesto the Begur Company for the completion of the Southern Homes Projectand in connection with the handover of the sold units. It is pertinent tomention that both the aforementioned Agreements also containedHselfsame arbitration clauses. Clause 11 of the Agreements contemplate that the seat and venue of Arbitration would be New Delhi, and thearbitration would be governed by the Arbitration and Conciliation Act,1996.

6. As a consideration for the construction management servicesto be provided by it under the SCMA and the RCMA, the Petitioner -DHDL in terms of Clause 4 of the respective agreement, was entitled toa “Fee”. Clause 4.1 and 4.2 of the SCMA and RCMA, stipulated thatupon concluding its construction obligations, DHDL would submit a writtennotice of completion to Respondent No.1 and the Begur Company.Thereafter, Respondent No. 1 or the Begur Company, as the case maybe, shall have the right to reject or confirm the completion of the RajapuraHomes Project and the Southern Homes Project. The agreements furtherspecify that once Respondent No.1 and the Begur Company acceptedthe notice of completion, Ressimo PCC would be obligated to invest asum of Rs.75 crores (75,00,00,000/-) in the Begur Company. The saidamount is to be dealt with in the manner prescribed under the SCMAand RCMA. It is not in dispute that petitioner-DHDL intended to be theindirect beneficiary of the said Rs.75 crores. To further clarify themodalities of the “Fee” payable to DHDL under the SCMA and RCMA,a Fee Computation Agreement dated 25.01.2017 was also executedbetween Respondent No.1, the Begur Company and Respondent No.2(hereinafter, “Fee Agreement”).

7. The Petitioner-DHDL issued a written notice dated 16.08.2019certifying the completion of the Southern Homes Project pursuant toClause 4.2 of the SCMA and called upon the Begur Company to fulfillits subsequent obligation. However, the Begur Company vide reply dated30.08.2019, refused to accept it as a Valid Notice of completion underclause 4.2 of the SCMA. The Begur Company alleged that there hadbeen a delay in completing the construction projects and that the Petitionerhad not complied with the “Information Covenant” contemplated in Clause3.1 of the SCMA. The Begur Company further stated that the noticewas incomplete and lacked the necessary documents. Hence, whilerefusing to accept the notice, the Begur Company called upon thePetitioner to provide the required information and documents.

8. The Petitioner also issued written notice dated 26.10.2019,certifying the completion of the Rajapura Project pursuant to Clause 4.2of the RCMA. Respondent No.1 vide its reply dated 27.01.2020 againrefused to accept it as a valid notice of completion and cited reasons of AB

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Adelay and non-completion of the Rajapura Homes Project, incompletenotice, amongst others. The record reveals that after the rejection of thenotices dated 16.08.2019 and 26.12.2019, there were severalcommunications between the parties; however, they were unable toresolve their differences.

B9. The Petitioner subsequently vide letter dated 26.05.2020 issueda notice invoking arbitration under Clause 11 of the SCMA and RCMA.The Petitioner’s case was that the notice of completion dated 16.08.2019and 26.12.2019, which were issued pursuant to Clause 4.2 of the SCMA/RCMA, were unreasonably rejected by the Respondent(s). ThePetitioner-DHDL alleged that the refusal of the Respondent CompaniesCto accept the notice of completion was a breach under the SCMA andRCMA and was aimed at avoiding Respondent No.2’s obligation to investRs.75 crores in the Begur Company as contemplated under the SCMA,RCMA and the Fee Agreement. The Petitioner further referred alldisputes arising out of the RCMA and SCMA to a common and compositeDArbitral Tribunal comprising a sole arbitrator. The Petitioner also proposedtwo names, for one of them to be appointed as the sole arbitrator.

10. The Respondents (i.e. Respondent No.1, the Begur Companyand Respondent No.2) vide two separate emails, both dated 12.06.2020,however, refused to appoint a sole arbitrator. They stated that the disputeEbetween the parties was not whether Respondent No.2 had any obligationafter accepting the respective notice of completions but whether or notcompletion in respect of the Rajapura Project and the Southern HomesProject has been achieved, which is an obligation on DHDL under Clause6 of the Rajapura SPA and Southern Homes SPA. It was thus claimedthat the differences between the parties have arisen under the RajapuraFSPA and Southern Homes SPA and not under the RCMA/SCMA. TheRespondents further refused to have the disputes consolidated into acommon and composite tribunal and instead asserted that the same wouldhave to be resolved under separate arbitration proceedings. Thereafter,on 13.06.2020, the Respondents issued two more letters through theirGCounsel, Fresh fields Bruckhaus Deringer Singapore Pte. Ltd., reiteratingthat the disputes between the parties do not fall within the terms of theSCMA and RCMA. Further, the Respondent(s) reserved their right toinvoke the dispute resolution provisions under the Southern Homes SPAand Rajapura SPA, respectively by instituting arbitral proceedings underthe rules of SIAC.H

11. Aggrieved by the refusal of the Respondent(s) to appoint anArbitrator under the RCMA and SCMA, the Petitioner has preferredthese two separate petitions under Section 11(6) read with Section 11(12)of the Act, praying for appointment of a sole arbitrator for resolution ofall disputes arising from the SCMA and RCMA. It may be highlightedthat since Respondent No.2 is not a body incorporated in India, thearbitration between the Parties falls within the ambit of ‘internationalcommercial arbitration’ as defined under Section 2(1)(f) of the Act.

CONTENTIONS

12. We have heard learned Senior Counsels appearing for theparties at considerable length. Learned Senior Counsel appearing onbehalf of the Petitioner–DHDL contended that the Begur Company andRespondent No.1 acted unreasonably in not accepting the notice ofcompletion. The rejection of the notice certifying the completion ofRajapura Homes Project and Southern Homes Project was allegedlydone with the sole purpose of avoiding Respondent No.2’s obligation topay “Fee” to the Petitioner. He further pressed that the contention ofthe Respondents that the disputes in question cannot be arbitrated underthe RCMA and SCMA is legally and factually misconceived.

13. Drawing force from the decisions of this Court in the cases of(i) Duro Felgura, S.A. v. Gangavaram Port Limited[1], (ii) GarwareWall Ropes Limited v. Coastal Marine Constructions andEngineering Limited[2], (iii) Mayavati Trading Private Limited v.Pradyuat Deb Burman[3], and (iv) Vidya Drolia and Others v. DurgaTrading Corporation[4], learned Senior Counsel for the Petitionersubmitted that this Court while dealing with an application under Section11(6) of the Act has a narrow scope of examination, confined only totrace out whether there exists an ‘arbitrable dispute’ and a ‘writtencontract’ providing ‘arbitration’ as the Dispute Resolution Mechanism.He canvassed that since the parties have not disputed the existence ofarbitration agreement or its core contractual ingredients contained in theSCMA and RCMA, the present dispute, in terms of the settled law,should be referred to arbitration. The recent decision of this Court in 1 (2017) 9 SCC 729, ¶ 48 & 59

2 (2019) 9 SCC 209, ¶14

3 (2019) 8 SCC 714, ¶10

4 (2021) 2 SCC 1, ¶236, 237, 244.3, 244.4, 244.5, 244.5.1–244.5.3

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AUttarakhand Purv Sainik Kalyan Nigam Limited v. Northern CoalField Limited[5], has also been relied upon to contend that once theexistence of the arbitration agreement was established, all other incidentalissues should be left to be decided by the arbitrator as prescribed underSection 16 of the Act, which enshrines the principle of “KompetenzKompetenz”. The contention appears to be that the Arbitral TribunalBwould eventually rule whether or not the disputes between the instantparties fall under the terms of the SCMA and the RCMA.

14. Learned Senior Counsel for the Petitioner further contendedthat although the RCMA and SCMA are two separate agreements, theyare inextricably interlinked, and since the dispute in question relates toCpayment of ‘Fees’ to the Petitioner for its services under both theConstruction Management Agreements, the disputes may be referred toa common and consolidated arbitral tribunal. Reliance has been placedon the judgment of this Court in P.R. Shah, Shares and Stock BrokersPrivate Limited v. BHH Securities Private Limited and Others[6], toDurge that proceedings ought to be consolidated to avoid multiplicity ofarbitrations and conflicting decisions, which would have the potential tocause injustice. In the alternative, it was prayed that this Court mayappoint the same sole arbitrator in both the Arbitration Petitioner No.17of 2020 and Arbitration Petition No.16 of 2020, and leave the decisionrelating to consolidation of the arbitral proceedings to the discretion ofEthe sole arbitrator.

15. Per Contra, learned Senior Counsel appearing on behalf ofthe Respondents vehemently controverted the case of DHDL andreiterated that the dispute sought to be raised in the present ArbitrationPetitions exclusively falls within the ambit of Rajapura SPA and SouthernFHomes SPA; therefore, the differences between the parties could notbe referred to arbitration under the RCMA and SCMA. He argued thatthe Rajapura SPA and the Southern Homes SPA are the principalagreements governing the transaction between the parties, and theRCMA/SCMA were subsequently executed only to operationalise themanner in which the Petitioner would fulfill its construction obligation asGper Clause 6 of the respective Share Purchase Agreements. It wasfurther alleged that while DHDL is intended to be the beneficiary ofRs.75 crores to be deposited by Respondent No.2, the economic interest 5 (2020) 2 SCC 455, ¶7.10, 7.11H6 (2012) 1 SCC 594, ¶ 19

of the Respondent(s) is confined to the undeveloped land, and thebreaches on the part of the Petitioner concerning its obligations underClause 6 of the Share Purchase Agreements have made it difficult forthem to monetise the undeveloped land. It was therefore contended thatthe instant disputes could only be arbitrated as per the dispute resolutionmechanism specified in Clause 9 of the Rajapura SPA/Southern HomesSPA, namely, the Rules of SIAC with seat and venue of Arbitration atSingapore. He urged that if the seat of Arbitration were to be foundoutside India, i.e, Singapore, the instant Applications under Section 11(6)of 1996 Act are not maintainable[7].

16. Citing the decisions of this Court in Duro Felgura, S.A.(supra)[8] and Vidya Droila (supra)[9], Senior Counsel for theRespondentscontended that while deciding an application under Section11(6), this Court cannot act cursorily and an absolute ‘hands off’ approachwould be counterproductive. He drew support from the afore-citeddecisions to emphasise that this Court is required to examine whetherthe agreement(s) in question contain a clause that provides for arbitrationin respect of the disputes which have actually arisen between the parties.He drew our attention to the judgement in Olympus SuperstructurePvt. Ltd. v. Meena Vijay Khetan and Others[10], wherein, this Courtheld that in a situation where there are disputes and differences inconnection with the main agreement and also disputes regarding othermatters connected thereto, the arbitration would be governed by thegeneral arbitration clause of the main agreement. Lastly, it was submittedthat in the event the present arbitration petitions are allowed, this Courtwhile following the principles laid down in Duro Felguero, S.A., (Supra)and Indus Biotech Private Limited v. Kotak India Venture (Offshore)Fund and Ors[11], need to appoint separate arbitral tribunals under theRCMA and SCMA, though it may comprise of the same sole arbitrator.

ANALYSIS

17. There is no gainsaying that by virtue of the Arbitration andConciliation (Amendment) Act, 2015, by which Section 11 (6-A) was 7 Bharat Aluminum Company v. Kaiser Aluminum Technical Services Inc., (2012) 9SCC 552, ¶117; Mankatsu Impex Private Limited v. Airvisual Limited (2020) 5 SCC399,¶ 14, 16, 18-288 ¶48

9 ¶132, 134, 139, 147.2, 147.6, 147.7 & 147.10

10 (1999) 5 SCC 651, ¶ 27, 28 & 30

11 2021 SCC Online SC 268, ¶ 39

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Aintroduced, the earlier position of law as to the scope of interference bythis Court at the stage of referral has been substantially restricted. It isalso no more res integra that despite the subsequent omission of Section11(6-A) by the Arbitration and Conciliation (Amendment) Act, 2019, thelegislative intent behind thereto continues to be a guiding force for theCourts while examining an application under Section 11 of the Act.B

18. The jurisdiction of this Court under Section 11 is primarily tofind out whether there exists a written agreement between the partiesfor resolution of disputes through arbitration and whether the aggrievedparty has made out a prima facie arbitrable case. The limited jurisdiction,however, does not denude this Court of its judicial function to look beyondCthe bare existence of an arbitration clause to cut the deadwood. A three-judge bench in Vidya Drolia (Supra), has eloquently clarified that thisCourt, with a view to prevent wastage of public and private resources,may conduct ‘prima facie review’ at the stage of reference to weed outany frivolous or vexatious claims. In this context, the Court, speakingDthrough Sanjiv Khanna, J. held that:

“154.2. Scope of judicial review and jurisdiction of the court underSections 8 and 11 of the Arbitration Act is identical but extremelylimited and restricted.

154.3. The general rule and principle, in view of the legislativeEmandate clear from Act 3 of 2016 and Act 33 of 2019, and theprinciple of severability and competence-competence, is that theArbitral Tribunal is the preferred first authority to determine anddecide all questions of non-arbitrability. The court has beenconferred power of “second look” on aspects of non-arbitrabilityFpost the award in terms of sub-clauses (i), (ii) or (iv) of Section34(2)(a) or sub-clause (i) of Section 34(2)(b) of the ArbitrationAct.

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154.4. Rarely as a demurrer the court may interfere at Section 8or 11 stage when it is manifestly and ex facie certain that theGarbitration agreement is non-existent, invalid or the disputes arenon-arbitrable, though the nature and facet of non-arbitrabilitywould, to some extent, determine the level and nature of judicialscrutiny. The restricted and limited review is to check and protectparties from being forced to arbitrate when the matter isdemonstrably “non-arbitrable” and to cut off the deadwood. TheHcourt by default would refer the matter when contentions relating to non-arbitrability are plainly arguable; when consideration insummary proceedings would be insufficient and inconclusive; whenfacts are contested; when the party opposing arbitration adoptsdelaying tactics or impairs conduct of arbitration proceedings. Thisis not the stage for the court to enter into a mini trial or elaboratereview so as to usurp the jurisdiction of the Arbitral Tribunal butto affirm and uphold integrity and efficacy of arbitration as analternative dispute resolution mechanism.”

N.V. Ramana, J. (as His Lordship then was) in his supplementaryopinion further crystalised the position as follows:

“244. Before we part, the conclusions reached, with respect toQuestion 1, are:

244.1. Sections 8 and 11 of the Act have the same ambit withrespect to judicial interference.

244.2. Usually, subject-matter arbitrability cannot be decided atthe stage of Section 8 or 11 of the Act, unless it is a clear case ofdeadwood.

244.3. The court, under Sections 8 and 11, has to refer a matter toarbitration or to appoint an arbitrator, as the case may be, unless aparty has established a prima facie (summary findings) case ofnon-existence of valid arbitration agreement, by summarilyportraying a strong case that he is entitled to such a finding.

244.4. The court should refer a matter if the validity of thearbitration agreement cannot be determined on a prima facie basis,as laid down above i.e. “when in doubt, do refer”.

244.5. The scope of the court to examine the prima facie validityof an arbitration agreement includes only:

244.5.1. Whether the arbitration agreement was in writing?Or 244.5.3. Whether the core contractual ingredients qua thearbitration agreement were fulfilled?

244.5.4. On rare occasions, whether the subject-matter ofdispute is arbitrable?”

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A19. To say it differently, this Court or a High Court, as the casemay be, are not expected to act mechanically merely to deliver apurported dispute raised by an applicant at the doors of the chosenArbitrator. On the contrary, the Court(s) are obliged to apply their mindto the core preliminary issues, albeit, within the framework of Section11(6-A) of the Act. Such a review, as already clarified by this Court, isBnot intended to usurp the jurisdiction of the Arbitral Tribunal but is aimedat streamlining the process of arbitration. Therefore, even when anarbitration agreement exists, it would not prevent the Court to decline aprayer for reference if the dispute in question does not correlate to thesaid agreement.C

20. Keeping the settled position of law in mind, the foremostquestion that arises for our consideration is whether the nature of disputesought to be referred for arbitration in these petitions fall under theArbitration Clause(s) of RCMA and SCMA, governed by the Arbitrationand Conciliation Act, 1996, with the seat and venue for arbitration atDNew Delhi or such disputes can be arbitrated only in terms of the disputeresolution mechanism specified in Clause 9 of the Rajapura SPA/SouthernHomes SPA i.e. under the rules of the Singapore International ArbitrationCentre and the seat and venue of the arbitration at Singapore?

21. With a view to analyse and answer the afore-stated question,Eit is essential to understand the nature of the two sets of agreementsexecuted between the parties from time to time and the subsequentamendments thereof.

22. The first set of agreements comprises of two Share PurchaseFAgreements. Rajapura SPA was executed on 08.07.2016, whereunderthe Petitioner, Respondent No.1 and Respondent No.2 agreed to thesale of shares of Respondent No.1 by DHDL in favour of RespondentNo.2/Resimmo PCC as ‘the purchaser’. The Southern Homes SPA dated25.01.2017 also pertains to the sale of shares of the Begur Company byDHDL to Respondent No.2. Although these are two agreements but theGagreed terms are materially same except the total equity shares agreedto be sold and the location of the residential projects. We thus, for thesake of brevity, propose to re-produce the following relevant clausesfrom the Rajapura SPA:- H

“1. DEFINITIONS AND INTERPRETATION

1.1 Definitions

...

“Rajapura Projects Completion” shall have the meaningascribed in Clause 6.3; …

2. AGREEMENT TO SELL AND PURCHASE THE SALESHARES

2.1 Subject to the terms and conditions of this Agreement,the Seller agrees to sell the Purchaser, and the Purchaseragrees to purchase from the Seller, on the Closing Date,the Sale Shares free and clear from all Encumbrances,together with all rights, title and interests arising therefrom(including all rights and advantages now and hereafterattaching or accruing thereto), such that the Purchaser shall,upon completion of the sale of the Sale Shares in its name,receive full legal and beneficial ownership of the said SaleShares and all rights and benefits relating thereto and arisingthereof.

2.2 The Sale Shares shall be purchased by the Purchaser in theirentirety on the Closing Date. The Seller shall have the right torefuse to sell the Sale Shares to the Purchasers if the Purchasersis unwilling to purchase or does not purchase in entirety the SaleShares on the Closing Date.

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3. CONDITIONS PRECEDENTS

3.1 The Seller shall do all acts, deeds and things (includingby exercising their voting rights at Board and shareholdermeetings) and shall execute all documents necessary,incidental or ancillary to the fulfillment of the conditionsset out in SCHEDULE II (the “Conditions Precedent”). Ifany Party becomes aware of any event or circumstance that willor may prevent any of the Conditions Precedent from beingsatisfied, on or prior to the Closing Date, it shall forthwith notify A

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the other Parties in writing of such event or circumstance and theParties shall take such action and steps as may be required (tothe extent within a Party’s control) to remove the event/circumstances without imposing any liability on any other Partyand without the prior written consent of such other Party.

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3.3 The obligation of the Purchaser to purchase Sale Shares andpay the Sale Consideration on the Closing Date in the mannerspecified in this Agreement, shall be conditional upon fulfilmentby the Seller (or where permissible under applicable Law, waiverin writing by the Purchaser in its sole discretion) of the ConditionsPrecedent.

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6. CONSTRUCTION RELATED OBLIGATIONS OF THESELLER

6.1 The Seller shall, through appropriate contractors to beappointed by the Company (in accordance with the terms ofthe Construction Agreement), as per the terms set out inSCHEDULE V and to be set out in the ConstructionAgreement proposed to be executed as a Condition Precedent,ensure (i) completion of construction of the Rajapura Phase IIProject on or prior to December 31, 2016, (ii) obtain the occupationcertificate for the Project on or prior to December 31, 2016; and(iii) where applicable, hand over possession of units of the RajapuraProjects to the purchasers of units or the Company (as and whenrequired pursuant to the applicable sales contracts and/or Lawbut subject to the aforementioned time limit) until the later of (i)12 (twelve months) from receipt of the occupation certificate forthe Rajapura Phase II Project, the timeline for completion of theRajapura Phase II Project shall, subject to the Seller takingreasonable steps to minimize the impact of the Force Majeureevent, be extended from December 31, 2016 by such period asfor which such Force Majeure event subsists. The obligation ofthe Seller with respect to handover after expire of theaforementioned time period shall be as set out in the ConstructionAgreement. Provided however that any unit for which finaldemand has been raised by the Company but for which possession has not been taken over by the customer despite 2 (two) writtenreminders and passage of 4 (four) months from the raising of thefinal demand shall be deemed to have been handed over for thepurpose of completion of the Construction Covenant. Further, Sellershall write to the Anekal Planning Authority in relation to thecompletion certificate for Rajapura Phase II Project, requestingthat the completion certificate dated December 12, 2016 referencenumber APA/LAO/59/2011-12 be deemed final as Company hasdecided to abandon the construction of towers W and X in BuildingNo. 6 of the Rajapura Phase II Project, get an acknowledgmentof receipt of the application from Anekal Planning Authority, andmake reasonable efforts to obtain an endorsement on the applicationfrom Anekal Planning Authority.

6.2 In addition, the Seller shall, through appropriatecontractors to be appointed by the Company (in accordancewith the terms of the Construction Agreement), on or priorto March 31, 2018, as per the terms to be set out in theConstruction Agreement proposed to be executed as aCondition Precedent, ensure completion of construction ofthe club house of 2,469.33 (two thousand four hundred sixtynine point three three) square metres built up area and 2,469.33(two thousand four hundred sixty nine point three three) squaremetres built up area and 2,446.25 (two thousand four hundredforty six point two five) square metres FAR area in the RajapuraProjects as per the terms set out in SCHEDULE V (“ClubConstruction”); provided that in the event that a Force Majeureevent materially impacts the Club Construction, the timeline forcompletion of the Club Construction shall, subject to the Sellertaking reasonable steps to mitigate the impact of the Force Majeureevent, be extended from March 31, 2018 by such period as forwhich such Force Majeure event subsists.

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9. DISPUTE RESOLUTION

All disputes or differences regarding this Agreement shall besubmitted to final and binding arbitration at the request of any ofthe disputing Parties upon written notice to that effect to the otherParties. In the event of such arbitration:

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A(i)The arbitration shall be in accordance with the rulesof the Singapore International Arbitration Centre(“SIAC”), in force at the relevant time (which isdeemed to be incorporated into this Agreement byreference); B(ii)All proceedings of such arbitration shall be in theEnglish language. The venue of the arbitration shallbe Singapore, which shall be the seat of thearbitration; …

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23. It may be mentioned that the Rajapura SPA was mutuallyamended by agreements dated 25.01.2017 and 16.03.2017. Similarly,the Southern Homes SPA was also amended by an agreement dated16.03.2017. The relevant clauses extracted above have taken notice ofDthe amendments conjointly carried out by the parties.

24. In terms of Clauses 3.1, 6.1 and 6.2 of Share PurchaseAgreements, as re-produced above, the parties entered into twoConstruction Management Service Agreements dated 25.01.2017 inrespect of Rajapura Project (RCMA) and Southern Homes ProjectE(SCMA). Since both these agreements are also in boilerplate language,the following relevant clauses of the RCMA are extracted:

“2. ENGAGEMENT & SCOPE OF SERVICES

2.1 On the terms and subject to the conditions set out in thisAgreement DHDL undertakes to provide constructionFmanagement services to the Company in relation to the completion(pursuant to the receipt of appropriate occupation certificates) ofthe Rajapura Projects and services in connection with the handoverof sold units in the Rajapura Projects and Construction Covenant(collectively, the “Services”). The scope of the Services shallGinclude:

(i) Monitoring and supervising the work being undertaken bythe project management consultant appointed for theRajapura Projects in accordance with the terms of the PMCContract:

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(ii) Monitoring and supervising of works being undertaken bythe various contractors appointed in accordance with theterms of the Existing Construction Contracts and Sub-Contracts:

(iii) Evaluation of prospective contractors for award ofconstruction works for the Rajapura Projects Completion:

(iv) Finalization and execution, on behalf of the Company, ofconstruction contracts with identified contractors forRajapura Projects Completion; (“New ConstructionContracts”), in accordance with the Approved Budget,provided that the cost pursuant to this Clause 2.1 (iv) mayexceed up to a cap of 25% (twenty five per cent) over thecost estimates in the Approved Budget:

(v) Monitoring and supervising of works being undertaken bythe various contractors appointed in accordance with theterms of the New Construction Contracts:

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4. FEES AND EXPENSES

4.1 In consideration of the Services to be provided by DHDLand performance of the terms of this Agreement, DHDLshall be entitled subject to the terms and conditionscontained in this Agreement, to the Fees and the Companyshall pay to DHDL the Fees (in the manner set out in thisClause 4), after deduction of any withholding tax requiredto be withheld deducted in accordance with Applicable Law.

4.2 Forthwith upon completion of the ConstructionCovenant and receipt of the occupation certificate in respectof each of the projects comprised in the Rajapura Projects,DHDL shall send a written notice to the Company certifyingfulfilment of completion of the Rajapura Projects, andenclose certified true copies of all necessary documentsevidencing fulfilment of the same and the Company shallhave the right to reject or confirm the fulfilment, within aperiod of 15 (fifteen) days from the date of receipt of theaforementioned written notice from DHDL, provided thatthe Company shall act reasonably in exercising such right,and receipt of occupation certificate from an appropriate A

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Governmental Authority will signify completion of anybuilding. In case the Company fails to respond to the saidcertificate within a period of 15 (fifteen) days, then theCompany shall be deemed to have accepted the fulfilmentof completion of the relevant project comprised in theRajapura Projects.

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4.3 Immediately upon receipt of the Rs.750,000,000 (Rupees SevenHundred and Fifty Million) by Southern Homes in the mannercontemplated under Clauses 4.3 or 4.4 (as the case may be) of the Southern Homes ConstructionCAgreement, the Company shall deposit an amount ofRs.150,000,000 (Rupees One Hundred and Fifty Million) into aseparate bank account of the Company identified by Resimmoand, notwithstanding anything to the contrary contained in theAgreement, the Company shall be entitled to deal with this amountof Rs.150,000,000 (Rupees One Hundred and Fifty Million) inDsuch manner as determined by its Board and the balance shall bedealt with as per the hierarchy of payment set out in Clause 3.8above.

11. DISPUTE RESOLUTION

ESubject to Clause 4.6, all disputes or differences regarding thisAgreement shall be submitted to final and binding arbitration atthe request of any of the Parties upon written notice to that effectto the other Party. In the event of such arbitration:

(i) The arbitration shall be in accordance with theArbitration and Conciliation Act, 1996, in force at therelevant time (which is deemed to be incorporatedinto this Agreement by reference); F

(ii) All proceedings of such arbitration shall be in theEnglish language. The venue of the arbitration shallbe New Delhi, which shall be the seat of the arbitrationGand the courts of New Delhi shall have exclusivejurisdiction over the arbitration proceedings;

(iii) The arbitration shall be conducted before a solearbitrator appointed jointly collectively by the Parties.In the event that the Parties are unable to agree on a H

sole arbitrator within 15 (fifteen) Business Daysfollowing submission of the dispute to arbitration, thearbitrator shall be appointed in the manner prescribedunder the Arbitration and Conciliation Act, 1996.”

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25. The ‘Share Purchase Agreements’ as well as the ‘ConstructionManagement Agreements’ are subsisting and have not been repudiatedby the Parties. Both sets of agreements contain arbitration clauses thatare not similar to one another. We are, therefore, of the considered opinionthat in order to determine the nature of arbitral proceedings, the twogroups of agreements will have to be read in harmony and reconciled soas to avoid any head on collision, and thereafter a conclusion as to whichof the clauses would be applicable in the present case, needs to be drawn.

26. Upon perusing the Share Purchase Agreements, it is clearthat the primary purpose of these agreements is to effectuate the changeof ownership of Respondent No.1 and the Begur Company from DHDLto Resimmo PCC. No doubt, the Rajapura SPA and the Southern HomesSPA as per their Clause 6.1 and 6.2, do provide for the completion of therespective residential projects as a post-closing obligation, however, theseconstruction obligations had to be fulfilled in accordance with the termsof the ‘Construction Agreements’. The very purpose of the RCMA andSCMA was, on the other hand, to operationalise the manner in whichthe Petitioner-DHDL would achieve the said construction relatedobligations. The construction agreements not only contemplate the scopeof services to be provided by the petitioner but also lays down the obligationon Respondent No.2 to pay “Fee” to the Petitioner-DHDL uponcompletion of the residential projects. A prima facie reading of ‘SharePurchase Agreements’ and ‘Construction Management Agreements’,does suggest that notwithstanding certain overlaps between theseagreements, their object and field of operation is different and distinct innature. It is therefore difficult for us to accept it outrightly that therespective Share Purchase Agreements are the ‘principal agreementsgoverning the transaction’ between the parties or that the present disputescan be resolved solely under the arbitration clause contained therein.

27. The dispute sought to be referred to arbitration by the PetitionerDHDL pertains to non-deposit of agreed amount by Respondent No.2

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Aand resultant payment thereof as ‘Fee’ which the Petitioner claims interms of clause 4 of RCMA/SCMA. Whether or not the Petitioner hascomplied with the ‘condition precedent’ under Rajapura SPA and thushas become entitled to ‘fee’ as per clause referred to above, is purely aquestion of fact to be determined by the Arbitral Tribunal.

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B28. We may at this stage also briefly refer to the judgment of thisCourt in Olympus Superstructure (Supra), wherein this Court facedtwo different arbitration clauses in two related agreements between thesame parties. The main agreement therein was concerned with the sellingof certain flats, and the related agreement was an Interior DesignAgreement, both of which contained an arbitration clause that was notCsimilar to each other. Since two valid arbitration clauses existed and theparties were relying upon the different arbitration clauses, this Courtharmonised both the clauses and viewed that the arbitration clause inthe main agreement was worded in wide terms and specificallycontemplated issues that were in “any way connected with, arisingDout of or in relation to the subject matter of the arbitrationagreement”. This Court, therefore, aptly held that since the disputesarising from the Interior Design Agreement were intrinsically “connectedwith” the disputes and differences arising out of the main contract, suchdispute could also be adjudicated under the main agreement itself.

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E29. The nature of arbitration clauses in the present case aresubstantially different when compared with the dispute resolution clauseof the main agreement in Olympus Superstructure (Supra). Thearbitration Clause 9 of the Rajapura SPA/Southern Homes SPA doesnot have any overriding effect and is in no way broader or wider whencompared to Clause 11 of the RCMA/SCMA. Therefore, even if weFwere to assume that the present differences between the parties areincidental to the terms of the Share Purchase Agreements, it is difficultto construe that Clause 9 of Share Purchase Agreements contemplatesadjudication of the issues that are “connected with” or are “in relation”to the subject matter of the Share Purchase Agreements.

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30. Further, if the Respondent(s) plea, that present dispute(s) shouldbe arbitrated only under the Rajapura SPA/Southern Homes SPA isaccepted at face value, the eventual result would be that any and alldisputes relating to the Petitioner’s construction obligation would bearbitrable under the provisions of the Share Purchase Agreements only.

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But then, what would be the purpose of having a separate arbitrationclause 11 under the RCMA/SCMA? The parties do not seem to haverendered the arbitration clause in RCMA and SCMA as redundant, moreso when these are the agreements later in time. It, thus, appears to usthat the scope of the arbitration clause in Rajapura SPA/Southern HomesSPA is limited to issues relating to the agreement’s primary subject matter,i.e., any dispute arising out of the transaction of sale and purchase ofshares. The provisions of the RCMA/SCMA, and the arbitration clausetherein, would as a logical corollary then be applicable to any dispute/difference concerning the performance of the construction relatedobligations and deposit of agreed amount by Respondent No.2 or paymentthereof to the Petitioner-DHDL.

31. The Petitioner has not once alleged in these Petitions that thedispute sought to be referred to Arbitration emanates from the SharePurchase Agreements. As far as the share transactions between thePetitioner and Respondent No.2 is concerned, learned Senior Counselfor the Petitioner has unequivocally submitted that the purchase of sharesby Respondent No.2 has been duly completed. There is nothing on recordto suggest that Respondent No.2 is aggrieved by non-compliance,deviation or breach of promise to sell its shares by the Petitioner-DHDL.On the contrary, the counter-affidavit filed by the Respondent(s) indicatesthat the sale of the shares of Respondent No.1 and the Begur Companyhave been completed. Still further, it is not the case that Ressimo PCChas already invoked Clause 9 of the Rajapura SPA or of the SouthernHomes SPA. Thus, when neither party has pleaded the infringement ofthe core provisions of the Share Purchase Agreements, it is difficult toaccept outrightly that the subject-controversy falls within the ambit ofClause 9 of the said agreements and can be adjudicated only under therules of SIAC, with seat and venue at Singapore.

32. At the cost of repetition, we may re-iterate that the Partieshave neither denied that there is no ‘arbitrable dispute’ between themnor have they challenged the existence of the arbitration clause(s) in theConstruction Management Service Agreements. Considering that theprimary twin-test envisioned under Section 11(6) of the Act has beensatisfied by the Petitioner-DHDL, we are of the view that the instantapplication(s) are maintainable. The nature of disputes that have arisenbetween the parties, thus, can be adjudicated in the arbitral proceedingsunder Clause 11 of the RCMA and SCMA.

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A33. It goes without saying, that if on appreciation of the facts andlaw, the arbitrator finds that the ‘real dispute’ between the parties stemsfrom the Share Purchase Agreements dated 08.07.2016 and 25.01.2017,the arbitrator shall be free to wind up the proceedings with liberty to theParties to seek redressal under the rules of SIAC.B34. We may now briefly deal with the question whether thedisputes should be referred to a consolidated and composite tribunal orshould there be two different arbitral tribunals to resolve the same. Itwas urged on behalf of the Petitioner that since the RCMA and SCMAare inextricably interlinked to each other, the dispute/difference cannotbe segregated into two separate proceedings. It was pointed out that theCobligation of computation/determination and payment of “Fee” to thePetitioner arises out of the SCMA, the RCMA and the Fee Agreement,and under the Fee Agreement, the parties have to calculate the “DLFReceivables”. Such DLF Receivables have to be computed taking intoaccount financial components/accounts of both, the Southern HomesDProject and the Rajapura Homes Projects. It was thus submitted that inorder to avoid multiplicity of proceedings which may result in conflictingawards, the sum of disputes may be referred to a single and compositearbitral tribunal.

35. The fact remains that the RCMA and SCMA, thoughEinterlinked and connected, are still two separate agreements. We alsocannot lose sight of the fact that the case of the Respondent(s) is thatthe Petitioner has committed breaches under both RCMA as well asSCMA, and that the genesis of the disputes lies in separate and distinctfacts. Save where the parties have resolved to the contrary, it would beinappropriate to consolidate the proceedings originating out of twoFseparate agreements. However, since the Fee Agreement provides thatthe “Fee” can only be calculated after taking into consideration variousfinancial components of both the Rajapura Homes Projects and theSouthern Homes Project, it would be necessary for the sake of avoidingwastage of time and resources, and to avoid any conflicting awards, thatGthe disputes under Arbitration Petition No.17 and Arbitration PetitionNo.16 are referred to a sole Arbitrator. We leave it to the wisdom of thesole arbitrator to decide whether the disputes should be consolidatedand adjudicated under one composite award or otherwise. The modalitiesand manner in which the two separate arbitral proceedings shall beconducted shall also be resolved by the sole arbitrator.H

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CONCLUSION

36. In light of above discussion, Arbitration Petition No. 16 of2020 and Arbitration Petition No.17 of 2020 are allowed. This Courtappoints Mr. Justice (Retd.) R.V. Raveendran, Former Judge, SupremeCourt of India as the sole arbitrator to resolve all disputes/differencesbetween the parties. The arbitrator will be paid fees in accordance withBthe Fourth Schedule of the Arbitration and Conciliation Act, 1996 asamended from time to time.

37. A copy of this order be dispatched to Mr. Justice (Retd.) R.V.Raveendran, Former Judge, Supreme Court of India at the followingaddress:

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“Mr. Justice (Retd.) R. V. Raveendran

Former Judge, Supreme Court of India

No. 8/2, Krishna Road, Basavangudi

Bangalore - 560004.

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Telephone Number: 080-26601279Mobile Number: 09654500060"

Divya Pandey

Petitions allowed.

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