HARBIN ELECTRIC INTERNATIONAL COMPANY LIMITED vs NATIONAL POWER PARKS MANAGEMENT COMPANY (PRIVATE) LIMITED S

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HARBIN ELECTRIC INTERNATIONAL COMPANY LIMITED VS NATIONAL POWER PARKS MANAGEMENT COMPANY (PRIVATE) LIMITED S. 8---Power of Court to appoint arbitrator---Agreement for Engineering, Procurement and Construction---Arbitration clause---Effect---Dispute arose between the parties, inter alia regarding claim of liquidated damages; invoice was issued but not honoured, which dispute allegedly, for the purposes of present proceedings, qualified as category of dispute(s) referable to the arbitrator(s)---Petitioner claimed that dispute could not be referred to the arbitrator(s) directly but only after exhausting the Alternate Dispute Resolution Mechanism, provided for in the Agreement by way of provisioning of Dispute Adjudication Boards---Respondent invoked Arbitration Clause, by issuing notice dated 06.08.2021, whereby same had indicated commencement of the Arbitration and nominated their Arbitrator and sought nomination by other party---Upon alleged non-compliance, respondent invoked jurisdiction of the Civil Court, seeking appointment of Arbitrator(s) through filing of application under S. 8 of the Act of 1940---Application was replied by the petitioner, wherein objection was raised regarding arbitrability of the dispute without resorting to the Dispute Adjudication Boards---Petitioner claimed that resort to Dispute Adjudication Boards was a condition precedent and unless exhausted, no resort to the Arbitration Clause could be made---Court allowed the application and proceeded to direct parties to submit nomination---Validity---Court proceeded to direct parties to nominate Arbitrator(s) without appreciating that dispute was not regarding the mechanism of appointment of arbitrator(s) or numbers thereof, but whether arbitration clause could be resorted to or triggered without fulfilling pre-arbitration condition claimed by the petitioner---Court had failed to assess, ascertain and conceptualize the scope and extent of applicability of S. 8 of Act of 1940 in the context of the controversy whether requirement of approaching Dispute Adjudication Board was mandatory or discretionary---Order was found deficient, which failed to address and appreciate that mere appointment of Arbitrator(s) would not resolve the controversy unless effectiveness of pre-arbitration clause was determined---Interpretation of S. 8 of the Act of 1940 could be undertaken by the High Court but such determination, in the circumstances, when jurisdictional question was not conceived, let alone discussed by the Court, would be prejudicial---Let the Court decided the scope of its jurisdiction under S. 8 of the Act of 1940---Judgments referred needed no discussion in the context of customized drafting of Arbitration Clause---Thus, civil revision was allowed by setting aside the impugned order and matter was remanded, where application of the respondent shall be deemed pending---Court, while deciding the matter afresh, would determine the question that whether S. 8 provided jurisdiction to decide the controversy under reference.

HARBIN ELECTRIC INTERNATIONAL COMPANY LIMITED vs NATIONAL POWER PARKS MANAGEMENT COMPANY (PRIVATE) LIMITED S — 2026 CLD 681 LAHORE-HIGH-COURT-LAHORE

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