International Nut Alliance LLC vs Beena Cashew Company

A. Selvam, J.—Challenge in these Civil Miscellaneous Appeals is to the common order passed in Arbitration Original Petition Nos. 185 & 333 of 2010 by the Principal District Court, Tuticorin. The first respondent herein as petitioner has filed Arbitration Original Petition No. 185 of 2010 on the file of the Court below under Section 34 of the Arbitration and Conciliation Act, 1996 praying to set aside the arbitral award dated 11.05.2010 passed by the respondents 3 to 5. Likewise, the first respondent in Arbitration Original Petition No. 185 of 2010 as petitioner has filed Arbitration Original Petition No. 333 of 2010 under Section 9 of the Arbitration and Conciliation Act, 1996 praying to pass an interim order of attachment in respect of properties mentioned therein and also to direct the respondent to furnish sufficient security in pursuance of arbitration award dated 11.05.2010.

In Arbitration Original Petition No. 185 of 2010 it is averred that the petitioner is an exporter of cashew and its place of business situates at Kadambad Nadu, Pattanamthitta District, Kerala State. The petitioner has exported 700 cartons of cashew kernels of American standard W240 to the first respondent in March 2008 from the Port of Tuticorin. The petitioner has exported the same in accordance with the specification agreed upon under a sale contract dated 22.02.2008. The petitioner has obtained necessary certificates. The petitioner has issued an invoice dated 15.04.2008 in favour of the first respondent for 1,03,250 U.S. dollers. The payment of sale of cargo has been made on "Cash Against Documents" (C.A.D.) within 30 days. The petitioner has sent all documents through its bankers viz., South Indian Bank, Kollam on 17.04.2008. The time for payment has become expired on 22.05.2008. The first respondent after receipt of cargo has sold the same to its customers and realised the sale price. The customers of first respondent at Elpaso Port, managed to take delivery of the container on 20.05.2008 without making payment. The petitioner has received an E-mail from the first respondent on 20.05.2008 stating that the cargo has been de-stuffed and rejected. The first respondent and its customers have collected cargo without making payment. The petitioner reserves its right to sue against the first respondent and its buyers in USA. The petitioner has received 1,03,250 US dollars through normal banking channels on 03.06.2008. If there is any. defect in cargo, the first respondent is bound to ask the petitioner for having joint survey. The first respondent has erroneously stated that fumigation of cashew with Methyl Bromide is not permissible and the same is not in accordance with AFI terms. The first respondent has insisted the petitioner to take back and replace the entire cargo. The petitioner has not acceded the same. The first respondent has sold cargo to third parties and it has also paid entire sale price. The first respondent has had no interest or title in the cargo, since already sold out. The first respondent has no locus standi to raise dispute against the petitioner by way of arbitration on behalf of third parties. At this juncture, a demand for arbitration has been made by the first respondent. The second respondent has sent a notice of arbitration on 07.01.2010 and thereby fixed date of hearing on 16.02.2010. The petitioner has sent an interim reply dated 09.02.2010 denying the existence of arbitration clause under the contract in question. The petitioner has not served with claim statement and documents filed in support of the claim in question. Under the said circumstances, the petitioner has not been able to submit a detailed reply. The second respondent is nothing but an appointing authority and not an arbitrator and has no jurisdiction to decide the contentions of the petitioner. The second respondent has constituted a panel of 3 arbitrators to decide the dispute. The petitioner has not been able to visit USA on 01.05.2010. The petitioner has not known the names of arbitrators. The petitioner has sought for adjournment through E-mail. The petitioner has not received any communication from the second respondent. The respondents 3 to 5 have been appointed as arbitrators without notice to the petitioner and thereby passed an ex parte arbitral award dated 11.05.2010. The award passed by the respondents 3 to 5 is totally illegal. Under the said circumstances, the present Petition has been filed for getting the relief sought for therein.

In the counter filed on the side of the first respondent it has been specifically stated that with regard to import cashew to the first respondent a concluded contract has been executed, wherein a Clause is available in explicit terms for referring any dispute to arbitration. Further the remaining averments made in the petition are denied expressly.

In the petition filed in Arbitration Original Petition No. 333 of 2010 it is averred that the respondent therein has sent cargo of cashew to the petitioner not in accordance with the terms of contract and also specification. After giving due opportunity to the respondent, arbitrators have been appointed and they passed the arbitral award dated 11.05.2010. Under the said circumstances, the present petition has been filed for getting an interim order of attachment and also for directing the respondent to furnish security.

In the counter filed on the side of the respondent it is averred that all the averments made in the petition in respect of arbitration are false and therefore, the petitioner is not entitled to get the reliefs sought for therein.

The Court below after considering the rival contentions put forth on either side has allowed Arbitration Original Petition No. 185 of 2010 and dismissed Arbitration Original Petition No. 333 of 2010 by way of passing common order and the same has been challenged in the present Civil Miscellaneous Appeals.

Before contemplating the rival submissions made on either side, it would be condign to look into the following sections of the Arbitration and Conciliation Act, 1996.

Section 7 of the said Act reads as follows: Arbitration Agreement,-

(1) In this Part, "arbitration agreement" means an agreement by the parties to submit to arbitration all or certain disputes which have arisen or which may arise between them in respect of a defined legal relationship, whether contractual or not.

(2) An arbitration agreement may be in the form of an arbitration clause in a contract or in the form of a separate agreement.

(3) An arbitration agreement shall be in writing

(4) An arbitration agreement is in writing if it is contained in-

(a) a document signed by the parties;

(b) an exchange of letters, telex, telegrams or other means of telecommunication which provide a record of the agreement; or

(c) an exchange of statements of claim and defence in which the existence of the agreement is alleged by one party and not denied by the other.

(5) The reference in a contract to a document containing an arbitration clause constitutes an arbitration agreement if the contract is in writing and the reference is such as to make that arbitration clause part of the contract.

A mere reading of sub-sections 4 and 5 would reveal that an arbitration agreement must be in writing and the same should contain in

(a) a document, signed by parties

(b) an exchange of letters, telex, telegrams or other means of telecommunication which provide a record of agreement

(c) an exchange of statement of claims and defence, in which existence of agreement is alleged by one party and not denied by other.

Further, a reference in a contract should contain an arbitration clause which constitutes an arbitration agreement, if the contract is in writing.

Section 34 of the said Act deals with the grounds on which an arbitral award can be set aside.

Section 9 of the said Act deals with interim measures to be taken by Court before or during arbitral proceedings or at any time after passing arbitral award.

The present proceedings have become emanated on the basis of agreement dated 22.02.2008, alleged to have been entered into in between the petitioner in Arbitration Original Petition No. 185 of 2010 and first respondent, wherein some particulars are found place with regard to shipment of cashew by the petitioner in Arbitration Original Petition No. 185 of 2010 to the first respondent therein. The said agreement has not been signed either by the petitioner or by the first respondent and it contains only signature of broker of Nut Trading Corporation. On 15.04.2008, the petitioner in Arbitration Original Petition No. 185 of 2010 has issued a "seller''s guarantee", wherein at bottom it is recited as follows:

We guarantees that the shipped product to be good, sound and merchantable quality in accordance with API specifications and governance, including rules of arbitration, if necessary.

A plain reading of the said "seller''s guarantee" would go to show that the shipped product is good and sound and merchantable and further it states that the guarantee includes rules of arbitration, if necessity arises. To put it in short, rules of arbitration would come into play, if necessity arises in future.

As stated earlier, in the sales contract dated 22.02.2008, neither the petitioner nor the first respondent has put their respective signature. Likewise, in the seller''s guarantee letter also, except signature of the petitioner, signature of the first respondent does not find place.

The entire arbitration alleged to have been done by the respondents 3 to 5 is based upon Arbitration Rules of the Association of Food Industries, Inc., wherein Section 1 reads as follows:

Any party to a written contract which contains a provision for arbitration of any future dispute by or under the auspices of this Association, shall, when a controversy arises thereunder, file with the President of this Association a copy of the Demand for Arbitration made upon the other party and the fee to cover the cost of the arbitration as prescribed in Section X of these Rules. Such filing shall constitute a request for the institution of proceedings under these rules.

Section 2 reads as follows:

The clause providing for arbitration by the Association of Food Industries must appear on the front of the contract or, at least, on the side which is signed by both parties, and the following minimum wording is required:

Any controversy or claim arising out of this contract shall be settled in binding arbitration by the Association of Food Industries, Inc., of New York in accordance with its rules then obtaining.

A conjoint reading of the said sections would clearly show that with regard to arbitration, a written contract is very much essential and the same should be signed by both parties and further minimum words are necessary so as to constitute a Clause of arbitration.

In the instant case, there is no written agreement in between the petitioner and first respondent and as pointed out earlier, the concerned contract has been only signed by a broker. Even with regard to arbitration clause, no such written agreement is in existence in between the petitioner and first respondent. Under the said, circumstances, the Court below after having elaborate discussion and also after making reliance upon so many decisions has come to a conclusion to the effect that there is no concluded contract amongst the petitioner and first respondent.

With these factual and legal backdrops, the Court has to analyse as to whether a concluded contract has been in existence in between the petitioner and first respondent; as to whether the relief sought for in Arbitration Original Petition No. 185 of 2010 can be granted and also as to whether the Court below is having jurisdiction to entertain Arbitration Original Petition No. 185 of 2010? Further it is an avowed fact that the relief sought for in Arbitration Original Petition No. 333 of 2010 is depending upon the decision to be taken in Arbitration Original Petition No. 185 of 2010.

The learned counsel appearing for the appellant/first respondent has emphatically and also vehemently contended that the petitioner has been doing the business of exporting cashew. Under the said circumstances, a valid and concluded contract has come into existence in between the petitioner and first respondent and even in the guarantee letter given by the petitioner, a clause is available with regard to arbitration proceedings and further after giving proper opportunity to the petitioner, the second respondent has appointed the respondents 3 to 5 as arbitrators and respondents 3 to 5 after analysing the rival facts, have passed the arbitral award in question on 11.05.2010 on merits and the same cannot be challenged by way of filing a petition under Section 34 of the Arbitration and Conciliation Act, 1996 and the Court below without considering lack of jurisdiction and also without considering that the arbitral award in question has been passed on merits, has erroneously set aside the same and likewise, erroneously dismissed Arbitration Original Petition No. 333 of 2010. Under the said circumstances, the common order passed by the Court below is liable to be set aside.

In support of the contentions raised on the side of the appellant/first respondent, the following decisions are relied upon:

(a) In Doctor''s Associates, Inc. and NICK Lombardi, Petitioners V. Paul Casarotto et ux, the Supreme Court of United States has held as follows:

Montana law, however, declares an arbitration clause unenforceable unless "[n]otice that [the] contract is subject to arbitration" is "typed in underlined capital letters on the first page of the contract." The franchise agreement stated, on page nine and in ordinary type: "Any controversy or claim arising out of or relating to this contract or the breach thereof shall be settled by Arbitration.

As narrated earlier, the factual aspects mentioned in the decision referred to above are totally alien to the facts and circumstances of the present case.

(b) In Shakti Bhog Foods Limited Vs. Kola Shipping Limited, , the Hon''ble Apex Court has held that "the arbitration agreement need not be in writing signed by both parties and the inference as to existence thereof could also be drawn from the acts of parties to the agreement by way of their exchange of letters and information through fax, E-mails etc.,

In the present case, there existed a charter party agreement containing an arbitration clause signed by the party questioning the existence of arbitration agreement and validity thereof had never been questioned by the aforesaid party.

A mere reading of the said decision would reveal that with regard to arbitration, an agreement in writing need not be necessary. But at the same time, on the basis of subsequent contacts, exchange of letters in between parties, the Court can infer that there is an agreement with regard to arbitration.

(c) In Union of India (UOI) Vs. Harbans Singh Tuli and Sons Build. (P) Ltd., , the Hon''ble Apex Court has held that "a party to an agreement cannot challenge arbitral award under Section 34, if they failed to produce documents and also to cross examine deponents.

In the instant case, from the averments made in the petition, it is easily discernible that the second respondent has sent a notice with regard to alleged arbitration to the petitioner. The petitioner has given a reply, wherein it has been clearly stated that no arbitration clause is in existence. But to utter dismay, the second respondent has not sent any communication to the petitioner with regard to composition of arbitrators.

(d) In Cauvery Coffee Traders, Mangalore Vs. Hornor Resources (Intern.) Company Ltd., , the Hon''ble Apex Court has held that " a party who accepts benefit of a contract, cannot deny its validity and binding nature."

In the instant case, the primary question is as to whether a concluded contract is in existence with regard to arbitration and therefore, the circumstance mentioned in the decision referred to above, is totally alien to the factual situation of the present case.

It is an admitted fact that the second respondent has sent a demand for arbitration to the petitioner, wherein it is stated that "please take further notice, that unless within twenty days after service of this Notice of Intention to Arbitrate, you apply to stay the arbitration herein, you shall thereafter be precluded from objecting that a valid agreement was not made or has not been complied with and from asserting in court the bar of a limitation of time.

The consistent stand taken on the side of the petitioner is that after receipt of demand for arbitration, an immediate reply has been sent to the effect that there is no arbitration agreement in between the petitioner and first respondent.

(e) In Tamil Nadu Electricity Board Vs. Videocon Power Limited and Canara Bank, , the Division Bench of this Court has held that "in terms of Clauses 17(3)(a),(b) and (c), parties agreed to exclude Part I of the Act, Petition under Section 34 under Part I of Act, is not maintainable.

In the present case, such factual situation has not arisen in between the petitioner and first respondent.

(f) In Adhunik Steels Ltd. Vs. Orissa Manganese and Minerals Pvt. Ltd., , the Hon''ble Apex Court has held that "attempted sabotage of arbitration process by one party, role of courts in rescuing the arbitration process, by providing underlying support."

(g) In Phulchand Exports Ltd. Vs. OOO Patriot, , the Hon''ble Apex Court has held that "where experienced businessmen are involved in a commercial contract and the parties are not of unequal bargaining power, the agreed terms must ordinarily be respected as the parties may be taken to have had regard to the matters known to them."

As pointed out earlier, in the instant case, there is no agreed contract in between the petitioner and first respondent. Therefore, the factual situation mentioned in the decision is totally alien to the facts of the present proceedings.

(h) In MSK Projects (I) (JV) Ltd. Vs. State of Rajasthan and Another, , it is held that "claim not raised before arbitrator cannot be considered by Court in a petition filed under Sections 34, 31, 16 and 37(1)(a) of the Arbitration and Conciliation Act, 1996.

In the present case, the consistent reply sent by the petitioner is that there is no written agreement with regard to arbitration clause amongst the petitioner and first respondent and further, the arbitral award dated 11.05.2010 is an ex parte award and no opportunity has been given to the petitioner to put forth its detailed contention.

(i) In Unissi (India) Pvt. Ltd. Vs. Post Graduate Institute of Medical Education and Research, , it is held that "tender offer submitted by appellant accepted and subsequently acted upon by appellant. Absence of existence of any formal arbitration agreement, considering factual situations, it can be stated that there is an arbitration agreement.

(j) In VISA International Ltd. Vs. Continental Resources (USA) Ltd., , it is held that "no party can be allowed to take advantage of inartistic drafting of arbitration clause in any agreement as long as clear intention of parties to go for arbitration in case of any future disputes is evident from the agreement and materials on record including surrounding circumstances."

It has already been pointed out that such situation has not arisen in the present case in view of the materials found in the Sales Contract dated 22.02.2008 and Seller''s Guarantee Letter dated 15.04.2008.

(k) In M/s. Ethiopian Airlines Vs. M/s. Stic Travels (P) Ltd., , it is held that " where such attempts are made, the courts have to rise to the occasion and give interpretations which fulfil statutory objectives, cut short procedures and lend support to the true intention of parties as discernible in their arbitration agreement."

(l) In India Household and Healthcare Ltd. Vs. LG Household and Healthcare Ltd., , it is held that "if plea of fraud has been raised, existence of arbitration agreement can be found apart from existence of original agreement."

(m) In Nandan Biomatrix Limited Vs. D-1 Oils Limited, the Hon''ble Apex Court has held that "the agreement postulated resolution of disputes through institutional arbitration, then notwithstanding the non-mentioning of name of a specific institution therein, would be a valid arbitration clause."

In the present case, such materials are not available so as to infer to the effect that there is an arbitration clause.

(n) In M/s. Louis Dreyfus Commodities Asia Pte. Ltd. 501, Orchard Road 19-01, Wheelock Place, Singapore 238880 Vs. M/s. Govind Rubber Limited, it is held that " since contract in question contains a clause stating "Governing terms: Singapore Commodity Exchange" the Court can easily come to a conclusion that there is an arbitration agreement."

(o) In Jindal Exports Ltd. Vs. Fuerst Day Lawson, it is stated that "if there is any challenge with regard to validity of arbitration clause, the same should be decided with reference to substantive law governing contract itself."

(p) In S.P. Chengalvaraya Naidu (dead) by L.Rs. Vs. Jagannath (dead) by L.Rs. and others, , the Hon''ble Apex Court has held that "non-disclosure of relevant and material documents with a view to obtain advantage, amounts to fraud."

(q) In Smita Conductors Ltd. Vs. Euro Alloys Ltd., : Smita Conductors Ltd. Vs. Euro Alloys Ltd., , it is held that "if view of arbitrators is plausible view and cannot be ruled out as impossible to accept, Court cannot substitute its own view in its place."

(r) In Trimex International FZE Ltd. Dubai Vs. Vedanta Aluminium Ltd., India, , the Hon''ble Apex Court has held that "in the absence of written agreement, signed by both parties, inference can be drawn from documents approved and signed by parties in the form of exchange of E-mails, letters, telex, telegrams and other means of telecommunication."

The said decision has been rendered on the basis of Section 7 of the Arbitration and Conciliation Act, 1996. As stated in many places, in the present case, such exchange of letters have not emerged in between the petitioner and first respondent so as to come to a conclusion that both parties have agreed to the effect that there is an arbitration clause.

(s) In Union of India Vs. Arctic India reported in 2010 (4) Arb. LR 58 (Delhi), it is held that "Courts exercising their powers have to be extremely circumspect in admitting objections under Section 34."

(t) In Coal India Limited Vs. Canadian Commercial Corporation, , it is held that "if an arbitration award is not subject to Indian Law, annulment proceedings has to be taken in the country that was judicial seat of arbitration."

(u) In Steel Authority of India Ltd. Vs. Gupta Brother Steel Tubes Ltd., , it is held that "view taken by arbitrator as to meaning of a contractual clause if possible one and not absurd, then irrespective of its correctness or otherwise, not subject to judicial review, particularly under Article 136 of the Constitution of India."

(v) In Venture Global Engineering Vs. Satyam Computer Services Ltd. and Another, , the Hon''ble Apex Court has held that "unless applicability of Section 34 has been excluded, parties may challenge the award before an Indian court as defined in Section 2(1)(e) of the Arbitration and Conciliation Act, 1996."

(w) In Videocon Industries Limited Vs. Union of India (UOI) and Another, , it is held that "exclusion of Part I of the Arbitration and Conciliation Act 1996 should be specifically stated in arbitration agreement."

As a repartee to the contentions raised on the side of the appellant/first respondent, the learned counsel appearing for the first respondent/petitioner has befittingly contended to the effect that in the Sales Contract dated 22.02.2008, neither the petitioner nor the appellant/first respondent has put any signature, wherein signature of a broker is found place and only on the basis of the said Sale Contract, the petitioner after obtaining necessary certificates, has sent cashew kernels to the Port of Elpaso, Texas, USA with a Bill of Lading and also necessary invoice, wherein the customers of the first respondent have taken cargo. Under the said circumstances, after selling cashew kernels in question, the appellant/first respondent has had no title or interest over the same and further in the Seller''s Guarantee letter dated 15.04.2008, it has not been specifically stated that an arbitration clause is in existence in between the parties. Under the said circumstances, there is no concluded contract in between them and further with regard to composition of arbitrators, no proper indication has been given to the petitioner and the arbitrators have not at all considered the reply sent by the petitioner, wherein it has been clearly stated to the effect that there is no arbitration clause and therefore, the ex parte arbitral award dated 11.05.2010 is totally illegal and therefore, the petition in question has been filed under Section 34 of the Arbitration and Conciliation Act, 1996. After filing the same, the first respondent as petitioner has filed Arbitration Original Petition No. 333 of 2010 under Section 9 of the said Act and that itself shows that the appellant/first respondent has clearly accepted the jurisdiction of the Court below and therefore, the appellant/first respondent cannot raise any objection with regard to jurisdiction and the Court below after considering the rival contentions put forth on either side, has rightly allowed Arbitration Original Petition No. 185 of 2010 and rightly dismissed Arbitration Original Petition No. 333 of 2010 and therefore, the common order passed by the Court below is not liable to be interfered with.

In support of the contentions raised on the side of the first respondent/petitioner, the following decisions are relied upon:

(a) In Jagdish Chander Vs. Ramesh Chander and Others, , the Hon''ble Apex Court has held in explicit terms that "the main attribute of an arbitration agreement namely consensus ad idem to refer disputes to arbitration was missing. Parties could not be referred to arbitration or an arbitrator appointed under Section 11 on the basis of such a clause under Section 89 of the Code of Civil Procedure, 1908."

(b) In Indowind Energy Ltd. Vs. Wescare (I) Ltd. and Another, , the Hon''ble Apex Court has held that "there is no correspondence between W and I providing the record for any arbitration agreement between the parties. In the absence of any arbitration agreement between W and I, no claim or dispute of W with I can be the subject matter of reference to an arbitrator."

(c) In Bhatia International Vs. Bulk Trading S.A. and Another, , the Hon''ble Apex Court has held that "provisions of Part I are equally applicable to international commercial arbitrations held outside India, unless any or all such provisions have been excluded by agreement between the parties, expressly or by implication."

(d) In Venture Global Engineering Vs. Satyam Computer Services Ltd. and Another, , the Hon''ble Apex Court has held as follows:

The provisions of Part I of the Act would apply to all arbitrations including international commercial arbitrations and to all proceedings relating thereto. Where such arbitration is held in India, the provisions of Part-I would compulsorily apply and parties are free to deviate to the extent permitted by the provisions of Part-I. Even in the case of international commercial arbitrations held out of India provisions of Part-I would apply unless the parties by agreement, express or implied, exclude all or any of its provisions. Such an interpretation does not lead to any conflict between any of the provisions of the Act and there is no lacuna as such. The matter, therefore, is concluded by the decision in 2002 AIR SCW 1285, followed.

(e) In M/s Alagar Exports Vs. M/s Islamic Republic of Iran Shipping Lines of Tehran and David Farrington Fair Wind Shipping Ltd. , the Division Bench of this Court has held that "notice of appointment of arbitrators is very much essential."

(f) In INDTEL Technical Services Pvt. Ltd. Vs. W.S. Atkins PLC., , it has been explicitly held that " Arbitration Act, 1996 is equally applicable to International Commercial Arbitration held outside India, unless any of the said provision are excluded by agreement."

(g) In Oil and Natural Gas Corporation Ltd. Vs. SAW Pipes Ltd., , the Hon''ble Apex Court has held that " an award contrary to substantive provisions of law or provisions of the Arbitration and Conciliation Act or against the terms of contract, would be patently illegal."

(h) In McDermott International Inc. Vs. Burn Standard Co. Ltd. and Others, , it is held that " 1996 Act makes-provision for the supervisory role of courts and for the review of the arbitral award only to ensure fairness. The supervisory role is to be kept at a minimum level and interference is envisaged only in cases of fraud or bias, violation of natural justice etc.,"

(i) In A.B.C. Laminart Pvt. Ltd. and Another Vs. A.P. Agencies, Salem, , it is held that "cause of action arises in a suit for damages, where breach of contract has occurred."

(j) In Bharat Aluminium Company and Others Vs. Kaiser Aluminium Technical Service, Inc. and Others etc. etc., , the Larger Bench of the Hon''ble Apex Court has held that "if upon a construction thereof, the arbitration agreement is held to provide for seat of arbitration outside India, Part-I would be inapplicable to the extent inconsistent with arbitration law of seat of arbitration, even if the arbitration agreement purports to provide that 1996 Act shall govern arbitration proceedings. Further it is held that no application for interim relief and not suit for interim injunction simpliciter is maintainable in India in respect of foreign-seated. [ Bhatia International Vs. Bulk Trading S.A. and Another, and Venture Global Engineering Vs. Satyam Computer Services Ltd. and Another, , overruled prospectively. Further it is held that the law declared by the Hon''ble Larger Bench of this Court shall apply prospectively to all arbitration agreements executed after 06.09.2012."

From cumulative reading of the decisions accident on the side of the first respondent/petitioner, the Court can easily cull out the following aspects:

(a) With regard to arbitration clause, there must be a written contract signed by both parties.

(b) If there is no written contract, an arbitration agreement can be inferred from subsequent conduct of parties and communications exchanged in between them.

(c) Before composition of arbitrators, a notice to other party is very much essential.

(d) If an arbitral award emerged on the basis of fraud, the same can be set aside.

(e) Section 34 of the Arbitration and Conciliation Act, 1996 can be invoked unless there is a specific exclusion of jurisdiction of Indian courts in the arbitration agreement in question.

As per the dictum given by the Larger Bench of the Hon''ble Apex Court in the decision reported in Bharat Aluminium Company and Others Vs. Kaiser Aluminium Technical Service, Inc. and Others etc. etc., , if an arbitration agreement has been executed after 06.09.2012, wherein it has been specifically provided for seat of arbitration outside India, Part-I of Arbitration and Conciliation Act, 1996, is inapplicable. Further the dictum settled in Bhatia International Case followed in Venture Global Engineering Case has been overruled only prospectively and therefore, the dictum given by the Larger Bench of the Hon''ble Apex Court reported in Bharat Aluminium Company and Others Vs. Kaiser Aluminium Technical Service, Inc. and Others etc. etc., would not affect any transaction held prior to 06.09.2012.

The consistent stand taken on the side of the first respondent/petitioner is that in the sale contract dated 22.02.2008, neither party has put its signature. Even in the Seller''s Guarantee letter, the words "including rules of arbitration, if necessary" would indicate that future contract is very much essential for invoking arbitration.

It has already been discussed in detail that after Seller''s Guarantee letter dated 15.04.2008, no correspondence has become emerged in between the petitioner and first respondent with regard to arbitration and therefore, it is pellucid to come to a conclusion that there is a concluded contract between the parties. The main gravamen expressed on the side of the first respondent/petitioner is that the second respondent has given an initial notice, to which the first respondent/petitioner has given a short reply, wherein it has been clearly stated to the effect that there is no arbitration clause and further time extension has been sought for and further no notice has been sent to the first respondent/petitioner with regard to composition of arbitrators.

It has already been pointed out by way of quoting relevant decisions to the effect that notice to parties is very much essential with regard to demand of arbitration as well as composition of arbitrators. But in the instant case, such things have not happened and therefore, the Court can very well come to a conclusion that the arbitral award dated 11.05.2010 is nothing but one-sided award and the same can be challenged by invoking Section 34 of the Arbitration and Conciliation Act, 1996.

The Court below after making threadbare discussion and also by way of relying upon opt decisions rendered by the Hon''ble Apex Court, has rightly found that it has jurisdiction to entertain Arbitration Original Petition No. t85 of 2010 and also rightly set aside the arbitral award dated 11.05.2010. With regard to jurisdiction already necessary discussion has been made on the basis of certain decisions. Further the appellant/first respondent itself has filed a petition under Section 9 of the Arbitration and Conciliation Act, 1996 so as to get the relief sought for therein. Since the appellant/first respondent has invoked the said Section, it cannot be contended to the effect that the Court below is not having jurisdiction. It is a static principle of law that a party cannot be allowed to approbate and reprobate. Therefore, viewing from any angle, the contentions put forth on the side of the appellant/first respondent are devoid of merits, whereas the contentions put forth on the side of the first respondent/petitioner are having succulence.

As stated in many places, the relief sought for in Arbitration Original Petition No. 333 of 2010 is depending upon the decision to be taken in Arbitration Original Petition No. 185 of 2010. Since the petitioner in Arbitration Original Petition No. 185 of 2010 is entitled to get the relief sought for therein, it is needless to say that Arbitration Original Petition No. 333 of 2010 is liable to be dismissed even without discussion. In fine, both Civil Miscellaneous Appeals deserve dismissal and accordingly are dismissed without cost. The common order dated 06.07.2011 passed in Arb. O.P. Nos. 185 & 333 of 2010 by the Principal District Court, Tuticorin is confirmed. Connected. Miscellaneous Petitions are also dismissed.