Petition U/S 11 Of Arbitration Act Is Maintainable If Statutory Remedy Before Invoking Arbitration Clause Is Exhausted: J&K And Ladakh HC

The Jammu & Kashmir and Ladakh High Court bench of Chief Justice Tashi Rabstan has held that once the statutory remedy under contract is exhausted, arbitration clause can be invoked and appointment of the arbitrator can be sought under section 11 of the Arbitration Act.In this case, the respondent had to constitute Dispute resolution Board within 30 days after execution of the contract for resolving any dispute arising between the parties but no DRB was constituted. The court after perusing the relevant clauses of the agreement noted that as per the relevant clause of Special Conditions of Dispute Resolution Board, the respondents were under an obligation to constitute a DRB and intimate the same to the petitioner-contractor within a specified period of time, i.e., one month. The court further noted that this court in M/s Mohindra Bros versus Union of India & others, 2012 has held that even if there is a prohibition of seeking reference under the arbitration clause till the completion of the work, such condition would not come into play after the period of contract has expired. The court noted that the reference of the notice invoking arbitration letter of the claimant in respondents' letter dated 20.01.2024 clearly demonstrate that a notice invoking arbitration was duly served upon and replied too.