Dozco India

(Petitioner)

vs.
Doosan Infracore
(Respondent)

(2011)6 SCC
179

Issue
Whether Supreme Court have the
jurisdiction to appoint an Arbitrator u/s.
11 (6) of the Act even after having
Clause 23 in Arbitration Agreement.

Law.
Arbitration and Concilliation Act 1996

11. Appointment of arbitrators.

(6)Where, under an appointment procedure agreed upon by the

parties,(a)a party fails to act as required under that procedure; or
(b)the parties, or the two appointed arbitrators, fail to reach an
agreement expected of them under that procedure; or
(c)a person, including an institution, fails to perform any function
entrusted him or it under that procedure, a party may request the
Chief Justice or any person or institution designated by him take the
necessary measure, unless the agreement on the appointment
procedure provides other means for securing the appointment .

Arbitration Agreement
Clauses

"Art. 22. Governing Laws - 22.1 : This

agreement shall be governed by and construed
in accordance with the laws of The Republic of
Korea.

Art. 23. Arbitration - 23.1 : All disputes arising

in connection with this Agreement shall be
finally settled by arbitration in Seoul, Korea (or
such other place as the parties may agree in
writing), pursuant to the rules of agreement
then in force of the International Chamber of
Commerce

Facts

Petitioner entered into distributorship agreement

with Respondent.

Petitioner was exclusive distributor for respondent

in India and Bhutan for his products

The distribution agreement (Article 23) contained

an arbitration agreement providing for arbitration
under the ICC Arbitration Rules.

The seat of arbitration - Seoul, Korea (or such other

place as the parties may agree in writing

Governing law -Law of the Republic of Korea.

Disputes arises.

Petitioner sends a notice to the respondent calling

on it to appoint an arbitrator in accordance with the
arbitration agreement.

On the respondents failure to appoint an arbitrator,

the petitioner filed an application in the Supreme
Court of India for the appointment of an arbitrator
under section 11(6) of the Act.

Petitioners Arguments

As per Bhatia International and Indtel case provisions

of part 1 applies in case of international arbitration
which are held out of India and are governed by
foreign law, until and unless the parties by agreement
resist it. (Given in para 36 of Case) and therefore we
have right to appoint an arbitrator u/s 11(6) as courts
do have jurisdiction because of Part 1.

Bracketed portion of the arbitration agreement gives

parties an option to designate another place of
arbitration therefore it was never the intention of the
parties to designate Seoul, Korea, as the legal seat of
arbitration and hence it can be changed,

Respondents Arguments

Decisions of Bhatia international case wont be applicable

because there is a difference between Legal seat of
arbitration and geographically location for holding
proceedings which are misinterpreted here.

Parties have chosen the proper law of contract as well as

the arbitration agreement to be Korean law with a seat of
arbitration in Seoul and the arbitration law being
conducted in accordance with Rules of the ICC.

Referrring to Mustill and Boyd he argued that in case of

absence of express agreement, there is a strong prima
facie presumption that the parties intend the procedural
law to be the law of the 'seat' of the arbitration.

And referred to common feature of international

arbitrations explained in Redfern and Hunter. On
page 7 which clearly makes distinction and explain
how both works.

He pointed out that the bracketed portion is only for

the purpose of providing the convenience of holding
proceedings of the arbitration else where than
Seoul. However, that cannot be allowed to override
the main Clause of Art. 23.

For the seat of arbitration petitioner also relied on

the case of Infowares Ltd. v. Equinox Corporation
comparing it with there clause 10.1 and 23 of there
own clause but here respondent said that in 23
there is express exclusion of part 1 while in 10.1 its
not so here they cannot refer to this at any point of
time.

Courts Holding

Referring to Naviera Amozonica Peruna case, court

drew a distinction between the legal seat of
arbitration and a geographically convenient place of
arbitration and held that it was never the intention of
the parties to have the legal seat of arbitration as any
place other than Seoul, Korea.

Arts. 22 and 23 of the Distributorship Agreement

between the parties in this case clearly excluded Part I
of the Act and the law laid down in Bhatia International
and Equinox Corporation case is not applicable here so
no question of applicability of S. 11(6) of the Act and
the appointment of Arbitrator in terms of that
provision

Thank You

By- Pulkit Mogra