Bombay High Court
A A GARG AND COMPANYversusHUSSAIN AHMED PARPIA
- Decided
- Disposal
- DISPOSED OFF
Holding
The court held that a valid arbitration agreement existed and was properly invoked, and therefore appointed a sole arbitrator.
Summary
The applicant company filed a Section 11 application seeking the appointment of a sole arbitrator under an arbitration clause in its employment agreement with the respondent, a former employee who allegedly poached clients and staff after resigning. The agreement contained a clause allowing either party to refer disputes to a sole arbitrator, with the arbitration to be conducted in Mumbai under the Arbitration and Conciliation Act, 1996. The company served a notice of arbitration on the respondent, who did not respond. The court examined whether a valid arbitration agreement existed and whether the arbitration was properly invoked. Finding the clause enforceable and the invocation on 22 May 2025 valid, the court appointed Ms. Sneha Phene as the sole arbitrator and issued procedural directions. The order also directed communication of the appointment to the arbitrator and compliance with statutory disclosure requirements.
Issues considered
- Whether a valid arbitration agreement exists between the parties under the employment contract.
- Whether the arbitration was validly invoked pursuant to Section 11 of the Arbitration and Conciliation Act, 1996.
Legislation cited
Subjects
- Arbitration
- Employment Agreement
- Section 11 Application
- Sole Arbitrator
- Arbitration Agreement
- Poaching of Clients
- Arbitration and Conciliation Act
- Bombay High Court
Judgment
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
[ COMMERCIAL DIVISION ]
COMMERCIAL ARBITRATION APPLICATION NO.393 OF 2026
A.A. Garg and Company .. Applicant
Vs.
Hussain Ahmed Parpia .. Respondent
Ms. Sonia Sunil, Advocate for the Applicant.
None for the Respondent.
CORAM : GAUTAM A. ANKHAD, J.
DATE : 17th August, 2026.
P.C. :
1. This Section 11 Application is filed seeking appointment of the sole
Arbitrator in relation to the disputes that have arisen under the Employment
Agreement dated 17th July, 2023 (“Agreement”) executed between the parties.
The arbitration agreement between the parties is recorded at Clause No.18.2,
the relevant portion of which reads as under:-
“18. DISPUTE RESOLUTION
18.2 VALIDITY /IMPLEMENTATION
18.2.1. In the event of a dispute arising in connection with the
validity, interpretation, implementation of this Agreement,
either Party may refer the dispute for resolution to a sole
arbitrator or in case of disagreement in the appointment of
the arbitrator, to three arbitrators, of which each Party
shall nominate one and the third arbitrator shall be
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appointed by the said two arbitrators. The arbitration
proceedings shall take place in Mumbai, India in
accordance with the provisions of the Arbitration and
Conciliation Act, 1996, as amended from time to time.
All proceedings in any such arbitration shall be conducted in
English. The arbitration award shall be final and binding on the
parties and the parties agree to be bound thereby and to act
accordingly.
19. GOVERNING LAW
This Agreement shall be governed by laws of India. It is agreed by
both parties, the Courts of Mumbai shall have exclusive
jurisdiction in respect of all matters relating to or arising out of
this Agreement.”
2. The learned counsel appearing for the Applicant-Company submits that
the Respondent was in the Company’s employment from 11 th July, 2023 to 25th
March, 2025. The Respondent resigned from the employment, which
resignation was accepted on 16th April, 2025. The Respondent’s last working
day was 30th April, 2025. It is stated that the Respondent has approached
several customers and previous employees of the Applicant-Company and has
attempted to poach customers, employees and the business of the Applicant in
breach of the Agreement. In these circumstances, the Applicant addressed legal
notice dated 22nd May, 2025 calling upon the Respondent to immediately cease
and desist from approaching the Applicant’s clients and employees failing
which legal recourse would be taken against the Respondent. There was no
response to this notice. Consequently, on 6 th August, 2025, the Applicant has
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invoked arbitration under the Agreement. Once again there is no response to
the invocation notice.
3. The learned counsel for the Applicant-Company tenders an affidavit-of-
service dated 17th August, 2026 to demonstrate that the Application has been
served on the Respondent. The said affidavit is taken on record and marked ‘X’
for identification.
4. No one appears for the Respondent despite service. The record
demonstrates that the parties have executed the Employment Agreement. The
Applicant has invoked arbitration by its Advocate’s notice dated 22 nd May,
2025 which notice has been received by the Respondent. The acknowledgment
receipt is at pages 73 to 75 of the paper-book. At this stage, this Court is only
required to examine whether an arbitration agreement exists between the
parties and whether arbitration has been validly invoked. I am satisfied that
there exists a valid arbitration agreement in the Employment Agreement and
the same has been validly invoked on 22 nd May, 2025. Hence, this Application
is allowed in terms of the following order:-
[A]. Ms. Sneha Phene, learned Advocate of this Court is hereby
appointed as the sole Arbitrator to adjudicate upon the
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disputes and differences between the parties arising out of
and in connection with Employment Agreement referred to
above. The contact details of Ms. Sneha Phene, the sole
Arbitrator, are as under:
Office Address : 317B, New Bake House,
Maharashtra Chamber of Commerce
Lane, Kala Ghoda, Mumbai – 400 001
Mobile Number : 9821889233,
E-mail ID : [email protected]”
[B]. A copy of this order will be communicated to the learned
Arbitrator by the Advocate for the Applicant within a
period of one week from the date on which this order is
uploaded on the website of this Court. The Applicant shall
provide the contact and communication particulars of the
parties to the Arbitral Tribunal along with a copy of this
order;
[C]. The learned Arbitrator is requested to forward the statutory
Statement of Disclosure under Section 11(8) read with
Section 12(1) of the Act to the Advocate for the Applicant
so as to enable them to file the same in the Registry of this
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Court. The Registry of this Court shall retain the said
Statement on the file of this Arbitration Application and a
copy of the same shall be furnished by the Advocate for
the Applicant to the Respondents;
[D]. The parties shall appear before the learned Arbitrator on
such date either on V.C. mode or at such place as indicated
to obtain appropriate directions with regard to conduct of
the arbitration including fixing schedule for pleadings,
examination of witnesses, schedule of hearings etc.
[E]. The fees of the learned Arbitrator shall be as per the Fourth
Schedule of the Act read with the Bombay High Court (Fee
Payable to Arbitrators) Rules, 2018.
[F]. All issues, claims and counterclaims are kept open to be
agitated before the Tribunal.
[G]. The arbitration shall be held at Mumbai.
[ GAUTAM A. ANKHAD, J. ]
Digitally
signed by
SNEHA 5/5
SNEHA ABHAY
ABHAY DIXIT 3-CARAP-393-2026.doc Dixit
DIXIT Date:
2026.08.18
10:49:01
+0530
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