ORDER OC-22 IN THE HIGH COURT AT CALCUTTA COMMERCIAL DIVISION ORIGINAL SIDE AP-COM/329/2025 M/S. UGRO CAPITAL LIMITED VERSUS P PRAFULCHANDRA AND COMPANY & ORS. BEFORE : The Hon’ble JUSTICE SHAMPA SARKAR Date: 9th June, 2025. Appearance: Mr. Paritosh Sinha, Adv. Mr. K. K. Pandey, Adv. Ms. Puja Sett, Adv. Ms. Mallika Bothra, Adv. for the petitioner. 1. Affidavit of service is taken on record. 2. Service was attempted upon the respondents on two occasions, but they have not appeared. Lastly, the Court directed the petitioner to serve upon the learned Advocate who had replied to the notice invoking arbitration. Such service has also been effected, but none appears to contest this application. 3. Under such circumstances, this Court is constrained to take up the matter ex parte. 4. This is an application for appointment of a learned Arbitrator for adjudication of disputes which arose between the parties out of a facility agreement. 5. The petitioner claims to be a registered non-banking financial services company. Allegedly a loan of Rs.35,52,500/- was sanctioned in favour 2 of the respondents. The respondents were required to repay the same in 36 equal monthly instalments of Rs.1,26,656/- each. According to the petitioner, the respondents did not adhere to the repayment schedule and defaulted. By a notice dated December 12, 2024, the petitioner terminated the facility agreement and recalled the loan. As on the date of such notice, the respondents were liable to pay Rs.24,56,838/-. Admittedly, the dispute between the parties is covered by an arbitration clause. The facility agreement was entered into by the parties on May 27, 2023. The notice invoking arbitration was issued on January 22, 2025. Clause 19.15 of the facility agreement provides that all claims, disputes, differences or questions of any nature arising between the parties, whether during or after the termination of the agreement shall be settled by arbitration. The seat and venue of arbitration shall be Kolkata. 6. The respondents replied to the notice invoking arbitration and specifically raised an objection with regard to the procedure/mechanism provided in the facility agreement with regard to the arbitration being administered by an institute recognized by Government of India. It was stated that insertion of such clause was unilateral and not acceptable under the settled principles of law. According to the respondents, reference of the dispute to an institution, by the petitioner, without there being an agreement as to which of the recognized institution of the Government of India should be approached by the parties for resolution of the dispute, would be hit 3 by the provision of Section 12(5) of the Arbitration and Conciliation Act, 1996. 7. Under such circumstances, this Court is satisfied that the mechanism for appointment of an arbitrator, as provided under the facility agreement has failed and as such, this application is allowed. The dispute is referred to a sole Arbitrator. Mr. Rachit Lakhmani is appointed as the sole Arbitrator, to arbitrate upon the disputes between the parties. 8. The learned Arbitrator shall comply with the provisions of Section 12 of the Arbitration and Conciliation Act, 1996. The learned Arbitrator shall be at liberty to fix his remuneration as per the schedule of Arbitration and Conciliation Act, 1996. 9. The application being AP-COM 329 of 2025 is accordingly disposed of. (SHAMPA SARKAR, J.) pa/JM