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Allahabad High Court

M/S KEC INTERNATIONAL LIMITEDversusNORTH CENTRAL RAILWAY AND ANOTHER

Decided

Holding

The Court held that an arbitration clause exists and, under Section 11(6), it may appoint a sole arbitrator when the parties fail to do so.

Summary

M/S Kec International Ltd entered into a contract with North Central Railway for supply and erection of a 25 kV feeder wire. After delays attributable to the railway, Kec sought an extension, which was granted, and later submitted a claim for prolongation that the railway rejected. On 30 March 2026 Kec issued a notice invoking the arbitration clause, but the railway failed to respond. The applicant filed an application under Section 11(6) of the Arbitration and Conciliation Act, 1996 for the court to appoint a sole arbitrator. Relying on recent Supreme Court rulings interpreting Section 11(6A) and the existence of an arbitration agreement, the High Court held that an arbitration clause exists and, since the parties could not agree on an arbitrator, the court may appoint one. The court appointed retired Supreme Court Judge Rajesh Bindal as arbitrator and allowed the arbitration application.

Issues considered

  • Whether an arbitration agreement exists between the parties.
  • Whether the High Court can appoint a sole arbitrator under Section 11(6) of the Arbitration and Conciliation Act, 1996 when the parties fail to agree on an arbitrator.
  • Interpretation of Supreme Court decisions on Section 11(6A) concerning the existence of an arbitration agreement.

Legislation cited

Subjects

  • Arbitration
  • Section 11
  • Arbitration agreement
  • Appointment of arbitrator
  • Contract dispute
  • Indian Arbitration Act

Judgment

         HIGH COURT OF JUDICATURE AT ALLAHABAD
       ARBITRATION AND CONCILI. APPL.U/S11(4) No. - 137 of 2026

M/S Kec International Limited
                                                           .....Applicant(s)
                                   Versus

North Central Railway And Another
                                                               .....Opposite
                                                                     Party(s)

Counsel for Applicant(s)      : Sagar Mehrotra
Counsel for Opposite Party(s) : Pranay Krishna,          A.S.G.I.,    Pooja
                                Agarwal

Court No. - 7
                   HON'BLE PIYUSH AGRAWAL, J.

1. Heard the learned counsel for the parties.

2. The instant application has been preferred under Section 11(6) of the
Arbitration & Conciliation Act, 1996 for appointment of a sole Arbitrator.

3. Learned counsel for the applicant submits that on 03.09.2021, an
agreement was executed between the parties for supply and erection of 25
KV feeder wire and buried earth conductor. He further submits that
certain delay caused on account of the fault attributable to the respondents
and thereafter, the applicant sought extension of time, which was granted.
Thereafter, the applicant submitted prolongation claim, which was
rejected by the respondent and ultimately, on 30.03.2026, a notice/letter
was issued to the respondent invoking the arbitration clause; however, the
respondent failed to respond to the same. Hence, this application.

4. Learned counsel for the opposite party does not dispute the fact about
the existence of dispute between the parties.

5. Having heard learned counsel for the parties, the scope of the present
proceedings under Section 11 of the Act does not require any elaboration
in view of that position in law having been made crystal clear by a recent
three judge decision of the Supreme Court in the case of M/S Mayavati
Trading Pvt. Ltd. Vs. Pradyuat Deb Burman, Civil Appeal No. 7023 of
2019, decided on 05.09.2019 in which it has been held as below:
                                                         ARCO No. 137 of 2026
                               2


"This being the position, it is clear that the law prior to the 2015
Amendment that has been laid down by this Court, which would have
included going into whether accord and satisfaction has taken place, has
now been legislatively overruled. This being the position, it is difficult to
agree with the reasoning contained in the aforesaid judgment as Section
11(6A) is confined to the examination of the existence of an arbitration
agreement and is to be understood in the narrow sense as has been laid
down in the judgment Duro Felguera, S.A. (supra) -- see paras 48 & 59."

6. While laying down that law, the Supreme Court had itself referred to
paragraph nos. 48 & 59 of its earlier decision in the case of Duro
Felguera, S.A. Vs. Gangavaram Port Ltd., (2017) 9 SCC 729.

7. That position in law has been reiterated in a recent decision of the
Supreme Court in GOQII Technologies Pvt. Ltd. Vs. Sokrati
Technologies Pvt. Ltd., (2025) 2 SCC 192.

8. In the facts of the present case, on prima facie basis, it has to be
accepted that there exists an arbitration clause, between the parties. Also,
it is clear that the parties have not been able to appoint consented
arbitrator and therefore, the appointing authority has to be assumed by
this Court upon the present application.

9. At the same time, no final conclusion is being drawn as may affect the
merits of the claim. That matter would remain to be considered by the
appropriate forum at the appropriate stage, upon claim, objection,
challenge or appeal being filed. Thus, amongst others it would remain
open to the opposite party to raise all objections as the Act permits.

10. Leaving that course completely open to the respective parties, at
present, only a forum is being provided for adjudication of a claim
proposed to be raised and resisted, in accordance with the law.

11. With the consent of the parties, this Court appoints Hon'ble Mr.
Justice Rajesh Bindal, Retired Judge of Supreme Court of India, R/o 2,
Akbar Road, New Delhi (Mob. No. 7347025001, E-mail-
[email protected]), to act as an Arbitrator for resolving the
disputes between the parties.
                                                                                            ARCO No. 137 of 2026
                                                                   3


                                    12. The learned Arbitrator shall be entitled to the fee in accordance as
                                    may be agreed between the parties and the learned Arbitrator.

                                    13. In view of the above, the present arbitration application stands
                                    allowed.

                                    14. The Registry is directed to forward a copy of this order to the learned
                                    Arbitrator through all permissible modes, including the electronic modes
                                    within a week.



                                                                                          (Piyush Agrawal,J.)
                                    September 30, 2026
                                    Amit Mishra




Digitally signed by :-
AMIT KUMAR MISHRA
High Court of Judicature at Allahabad


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