DLF HOME DEVELOPERS LIMITEDversusRAJAPURA HOMES PRIVATE LIMITED & ANR.

                         [2021] 12 S.C.R. 1                              1


              DLF HOME DEVELOPERS LIMITED                                A
                                  v.
        RAJAPURA HOMES PRIVATE LIMITED & ANR.
             (Arbitration Petition (Civil) No. 17 of 2020)
                                                                         B
                       SEPTEMBER 22, 2021
         [N.V. RAMANA, CJI AND SURYA KANT, J.]
      Arbitration and Conciliation Act, 1996 – s.11(6) r/w s.11(12)
– Appointment of Arbitrator – In terms of Share Purchase
Agreements, the parties entered into Construction Management             C
Agreements – Both sets of agreements contained arbitration clauses
not similar to one another – Disputes arose – Respondents refused
to appoint Arbitrator under the Construction Management
Agreements – Present petitions filed by the Petitioner for appointment
of a sole arbitrator for resolution of all disputes arising from the     D
Construction Management Agreements – Held: Notwithstanding
certain overlaps between the Share Purchase Agreements and
Construction Management Agreements, their object and field of
operation is different and distinct – It cannot be accepted outrightly
that the respective Share Purchase Agreements are the ‘principal
agreements governing the transaction’ between the parties or that        E
the present disputes can be resolved solely under the arbitration
clause contained therein – Neither party pleaded the infringement
of the core provisions of the said Agreements, thus it cannot be
accepted that the subject controversy falls within the ambit of Clause
9 thereof and can be adjudicated only under the rules of Singapore       F
International Arbitration Centre (SIAC), with seat and venue at
Singapore – Further, parties have neither denied that there is no
arbitrable dispute between them nor have they challenged the
existence of the arbitration clause(s) in the Construction
Management Service Agreements – The nature of disputes that have
arisen between the parties can thus, be adjudicated in the arbitral      G
proceedings u/Clause 11 of the Construction Management
Agreements – Primary twin-test u/s.11(6) satisfied by the Petitioner
– Sole arbitrator appointed to resolve all disputes between the
parties.
                                                                         H
                                  1
2            SUPREME COURT REPORTS                      [2021] 12 S.C.R.


A          Arbitration and Conciliation Act, 1996 – ss.11, 11(6-A) –
    Scope of interference by Court at the stage of referral – Held: Courts
    are obliged to apply their mind to the core preliminary issues within
    the framework of s.11(6-A) – Thus, even when an arbitration
    agreement exists, it would not prevent the Court to decline a prayer
    for reference if the dispute does not correlate to the said agreement
B
    – Arbitration and Conciliation (Amendment) Act, 2015 – Arbitration
    and Conciliation (Amendment) Act, 2019 – s.11(6-A).
          Allowing the petitions, the Court
          HELD 1. The jurisdiction of this Court under Section 11 is
C   primarily to find out whether there exists a written agreement
    between the parties for resolution of disputes through arbitration
    and whether the aggrieved party has made out a prima facie
    arbitrable case. The limited jurisdiction, however, does not
    denude this Court of its judicial function to look beyond the bare
    existence of an arbitration clause to cut the deadwood. This Court
D   or a High Court, as the case may be, are not expected to act
    mechanically merely to deliver a purported dispute raised by an
    applicant at the doors of the chosen Arbitrator. On the contrary,
    the Court(s) are obliged to apply their mind to the core preliminary
    issues, albeit, within the framework of Section 11(6-A) of the Act.
E   Such a review is not intended to usurp the jurisdiction of the
    Arbitral Tribunal but is aimed at streamlining the process of
    arbitration. Therefore, even when an arbitration agreement exists,
    it would not prevent the Court to decline a prayer for reference if
    the dispute in question does not correlate to the said agreement.
    [Paras 18, 19][14-B-C; 16-A-C]
F
          2.1 In terms of Clauses 3.1, 6.1 and 6.2 of Share Purchase
    Agreements, the parties entered into two Construction
    Management Service Agreements dated 25.01.2017. The ‘Share
    Purchase Agreements’ as well as the ‘Construction Management
    Agreements’ are subsisting and have not been repudiated by the
G   Parties. Both sets of agreements contain arbitration clauses that
    are not similar to one another. Upon perusing the Share Purchase
    Agreements, it is clear that the primary purpose of these
    agreements is to effectuate the change of ownership of
    Respondent No.1 and the Begur Company from DHDL to
H
 DLF HOME DEVELOPERS LTD. v. RAJAPURA HOMES PVT. LTD.                  3


Resimmo PCC. The Rajapura SPA and the Southern Homes SPA               A
as per their Clause 6.1 and 6.2, do provide for the completion of
the respective residential projects as a post-closing obligation,
however, these construction obligations had to be fulfilled in
accordance with the terms of the ‘Construction Agreements’.
The very purpose of the RCMA and SCMA was, on the other
                                                                       B
hand, to operationalise the manner in which the Petitioner-DHDL
would achieve the said construction related obligations. The
construction agreements not only contemplate the scope of
services to be provided by the petitioner but also lay down the
obligation on Respondent No.2 to pay “Fee” to the Petitioner-
DHDL upon completion of the residential projects. A prima facie        C
reading of ‘Share Purchase Agreements’ and `Construction
Management Agreements’, does suggest that notwithstanding
certain overlaps between these agreements, their object and field
of operation is different and distinct in nature. It is therefore
difficult to accept it outrightly that the respective Share Purchase
                                                                       D
Agreements are the ‘principal agreements governing the
transaction’ between the parties or that the present disputes can
be resolved solely under the arbitration clause contained therein.
[Paras 24-26][20-D-E; 23-B-G]
       2.2 The dispute sought to be referred to arbitration by the
Petitioner DHDL pertains to non-deposit of agreed amount by            E
Respondent No.2 and resultant payment thereof as ‘Fee’ which
the Petitioner claims in terms of clause 4 of RCMA/SCMA.
Whether or not the Petitioner has complied with the ‘condition
precedent’ under Rajapura SPA and thus has become entitled to
‘fee’ as per clause referred to above, is purely a question of fact    F
to be determined by the Arbitral Tribunal. The arbitration Clause
9 of the Rajapura SPA/Southern Homes SPA does not have any
overriding effect and is in no way broader or wider when compared
to Clause 11 of the RCMA/SCMA. Therefore, even if it is
assumed that the present differences between the parties are
incidental to the terms of the Share Purchase Agreements, it is        G
difficult to construe that Clause 9 of Share Purchase Agreements
contemplates adjudication of the issues that are “connected with”
or are “in relation” to the subject matter of the Share Purchase
Agreements. [Paras 27, 29][23-H; 24-A-B, E-G]
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4            SUPREME COURT REPORTS                     [2021] 12 S.C.R.


A         Olympus Superstructure Pvt. Ltd. v. Meena Vijay
          Khetan and Others (1999) 5 SCC 651: [1999] 3 SCR
          490 – distinguished.
           2.3 If the Respondent(s) plea, that present dispute(s) should
    be arbitrated only under the Rajapura SPA/Southern Homes SPA
B   is accepted at face value, the eventual result would be that any
    and all disputes relating to the Petitioner’s construction obligation
    would be arbitrable under the provisions of the Share Purchase
    Agreements only. But then, what would be the purpose of having
    a separate arbitration clause 11 under the RCMA/SCMA? The
    parties do not seem to have rendered the arbitration clause in
C   RCMA and SCMA as redundant, more so when these are the
    agreements later in time. The scope of the arbitration clause in
    Rajapura SPA/Southern Homes SPA is limited to issues relating
    to the agreement’s primary subject matter, i.e., any dispute arising
    out of the transaction of sale and purchase of shares. The
D   provisions of the RCMA/SCMA, and the arbitration clause
    therein, would as a logical corollary then be applicable to any
    dispute/difference concerning the performance of the construction
    related obligations and deposit of agreed amount by Respondent
    No.2 or payment thereof to the Petitioner-DHDL. The Petitioner
    has not once alleged in these Petitions that the dispute sought to
E   be referred to Arbitration emanates from the Share Purchase
    Agreements. As far as the share transactions between the
    Petitioner and Respondent No.2 is concerned, it has been
    unequivocally submitted on behalf of the Petitioner that the
    purchase of shares by Respondent No.2 has been duly completed.
F   There is nothing on record to suggest that Respondent No.2 is
    aggrieved by non-compliance, deviation or breach of promise to
    sell its shares by the Petitioner-DHDL. On the contrary, the
    counter-affidavit filed by the Respondent(s) indicates that the sale
    of the shares of Respondent No.1 and the Begur Company have
    been completed. Still further, it is not the case that Ressimo PCC
G   has already invoked Clause 9 of the Rajapura SPA or of the
    Southern Homes SPA. Thus, when neither party has pleaded the
    infringement of the core provisions of the Share Purchase
    Agreements, it is difficult to accept outrightly that the subject-
    controversy falls within the ambit of Clause 9 of the said
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 DLF HOME DEVELOPERS LTD. v. RAJAPURA HOMES PVT. LTD.                   5


agreements and can be adjudicated only under the rules of SIAC,         A
with seat and venue at Singapore. [Paras 30, 31][24-G-H;
25-A-F]
      2.4 The Parties have neither denied that there is no
‘arbitrable dispute’ between them nor have they challenged the
existence of the arbitration clause(s) in the Construction              B
Management Service Agreements. The primary twin-test
envisioned under Section 11(6) of the Act has been satisfied by
the Petitioner-DHDL, thus the instant application(s) are
maintainable. The nature of disputes that have arisen between
the parties, thus, can be adjudicated in the arbitral proceedings
under Clause 11 of the RCMA and SCMA. The RCMA and                      C
SCMA, though interlinked and connected, are still two separate
agreements. If on appreciation of the facts and law, the arbitrator
finds that the ‘real dispute’ between the parties stems from the
Share Purchase Agreements, the arbitrator shall be free to wind
up the proceedings with liberty to the Parties to seek redressal        D
under the rules of Singapore International Arbitration Centre
(SIAC). The case of the Respondent(s) is that the Petitioner has
committed breaches under both RCMA as well as SCMA, and
that the genesis of the disputes lies in separate and distinct facts.
Save where the parties have resolved to the contrary, it would be
inappropriate to consolidate the proceedings originating out of         E
two separate agreements. However, since the Fee Agreement
provides that the “Fee” can only be calculated after taking into
consideration various financial components of both the Rajapura
Homes Projects and the Southern Homes Project, it would be
necessary for the sake of avoiding wastage of time and resources,       F
and to avoid any conflicting awards, that the disputes under
Arbitration Petition No.17 and Arbitration Petition No.16 are
referred to a sole Arbitrator. Sole arbitrator appointed to resolve
all disputes/differences between the parties. [Paras 32, 33, 35
and 36][25-F-H; 26-A-B; E-H]
                                                                        G
      Duro Felgura, S.A. v. Gangavaram Port Limited (2017)
      9 SCC 729 : [2017] 10 SCR 285; Garware Wall Ropes
      Limited v. Coastal Marine Constructions and
      Engineering Limited (2019) 9 SCC 209 : [2019] 5 SCR
      579; Mayavati Trading Private Limited v. Pradyuat Deb
                                                                        H
6            SUPREME COURT REPORTS                          [2021] 12 S.C.R.


A         Burman (2019) 8 SCC 714 : [2019] 12 SCR 123; Vidya
          Drolia and Others v. Durga Trading Corporation (2021)
          2 SCC 1 : 2021 (6) JT 460; Uttarakhand Purv Sainik
          Kalyan Nigam Limited v. Northern Coal Field Limited
          (2020) 2 SCC 455; P.R. Shah, Shares and Stock Brokers
          Private Limited v. BHH Securities Private Limited and
B
          Others (2012) 1 SCC 594 : [2011] 16 SCR 87; Indus
          Biotech Private Limited v. Kotak India Venture
          (Offshore) Fund and Ors 2021 SCC Online SC 268 –
          referred to.
                             Case Law Reference
C
    [2017] 10 SCR 285                referred to                Para 13
    [2019] 5 SCR 579                 referred to                Para 13
    [2019] 12 SCR 123                referred to                Para 13

D   [2011] 16 SCR 87                 referred to                Para 14
    [1999] 3 SCR 490                 distinguished              Para 16
         CIVIL ORIGINAL JURISDICTION: Arbitration Petition (Civil)
    No.17 of 2020.
           Petition under section 11(6) read with section 11(12) of the
E   Arbitration and Conciliation Act, 1996, for Appointment of Sole Arbitrator.
          With
          Arbitration Petition (Civil) No. 16 of 2020.
           Dr. A. M. Singhvi, Sr. Adv., Amit Dhingra, Shivam Kumar Raheja,
F   Amit Bhandari, Pranav Kamnani, M/s Dua Associates, Advs. for the
    Petitioner.
         Nikhil Nayyar, Sr. Adv., Gyandendra Kumar, Ms. Shikha Tandon,
    Robin Grover, Ms. Shree Sinha, Sumit Attri, M/s Cyril Amarchand
    Mangaldas, Advs. for the Respondents.
G
          The Judgment of the Court was delivered by
          SURYA KANT, J.
        1. The Petitioner DLF Home Developers Limited (hereinafter,
    “DHDL”) has filed Arbitration Petition No. 16 of 2020 and Arbitration
H
 DLF HOME DEVELOPERS LTD. v. RAJAPURA HOMES PVT. LTD.                          7
                  [SURYA KANT, J.]

Petition No. 17 of 2020 under Section 11(6) read with Section 11(12) of        A
the Arbitration and Conciliation Act, 1996 (hereinafter, “Act”) for
appointment of sole arbitrator to adjudicate the differences between the
parties that have arisen out of the two Construction Management
Agreements dated 25.01.2017.
      FACTS                                                                    B
       2. DHDL is a limited liability involved in the business of providing
development, management, and investment services concerning real
estate projects. The Petitioner and one Ridgewood Holdings Limited
entered into a joint venture, in the year 2007-2008, wherein Ridgewood
Holdings Limited invested in four Special Purpose Vehicles, including          C
Rajapura Homes Private Limited (Respondent No.1 in Arbitration
Petition No.17 of 2020; hereinafter, “Respondent No.1”) and Begur OMR
Homes Private Limited (Respondent No.1 in Arbitration Petition No.16
of 2020; in short “Begur Company”), for developing residential projects
in various cities across India. Respondent No.1 is a company engaged in
the construction, development, operations, and maintenance of residential      D
projects, namely, ‘DLF Maiden Heights’ and ‘DLF Woodland Heights,’
both of which are in Bangalore, Karnataka (collectively called “Rajapura
Project”). Similarly, the Begur Company is engaged in the business of
construction, development, operations, and maintenance of residential
projects, namely, ‘DLF Garden City’ situated at Kanchipuram District,          E
Tamil Nadu, and ‘DLF Westend Heights’ situated in Bengaluru District,
Karnataka (collectively called “Southern Homes Project”).
        3. In June 2008, Ridgewood Holdings Limited transferred its stake
in the joint venture to its affiliates, Resimmo PCC (in short, “Respondent
No.2”) in both the Petitions and Clogs Holding BV (hereinafter, “Clogs”).      F
Thereafter, in terms of the arrangement, upon expiry of the exit period,
Respondent No.2 and Clogs were inter alia entitled to a put option on
the Petitioner, which they exercised from January to May 2014. However,
the Petitioner was unable to provide an exit to Respondent No.2 and
Clogs. Subsequently, in 2015, the parties agreed to a negotiated settlement,
in terms of which, Respondent No.2 was to acquire sole ownership and           G
control of two Special Purpose Vehicles, namely, Respondent No.1 and
the Begur Company. It may be noted that Respondent No.2 is a company
incorporated under the laws of Mauritius and is engaged in the business
of providing investment management services.
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8             SUPREME COURT REPORTS                           [2021] 12 S.C.R.


A          4. To effect the change of ownership of the First Respondent, the
    Petitioner, Respondent No.1, and Respondent No.2 executed a Share
    Purchase Agreement dated 08.07.2016 (hereinafter, “Rajapura SPA”)
    for the transfer of Petitioner’s entire shareholding in Respondent No.1
    to Respondent No.2. Likewise, a Share Purchase Agreement dated
    25.01.2017 was also executed between the Petitioner, the Begur
B
    Company and Respondent No.2 to transfer the Petitioner’s entire holding
    in the Begur Company to Respondent No.2 (hereinafter, “Southern Homes
    SPA”). While the primary subject matter of the Share Purchase
    Agreements was the transfer of shares from the Petitioner – DHDL to
    Respondent No.2, both the Share Purchase Agreements also stipulated
C   certain additional obligations that would have to be undertaken by the
    Petitioner. Clause 3.1 read with Schedule-II of the agreements
    contemplated that the parties were to execute a construction
    management agreement as a ‘condition precedent’ to the closing of the
    transactions. Further, in terms of Clause 6 of the respective agreements,
    the Petitioner had to undertake certain construction related obligations,
D
    which were to be performed “in accordance with the terms of the
    Construction Agreement”. We may note that both the Share Purchase
    Agreements also contained an arbitration clause which are identical.
    Clause 9 of the agreements contemplate that all disputes arising out of
    the contract shall be submitted for arbitration at the request of the parties.
E   The arbitration is to be conducted in accordance with the rules of the
    Singapore International Arbitration Centre (hereinafter, “SIAC”), with
    the seat and venue of the arbitration being Singapore.
           5. Thus, in terms of the agreement and in pursuance of the
    construction obligations under the Rajapura SPA and the Southern Homes
F   SPA, the Parties on 25.01.2017 executed the DLF-Rajapura Homes
    Construction Management Services Agreement (hereinafter, “RCMA”)
    and the DLF-Southern Homes Construction Management Services
    Agreement (hereinafter, “SCMA”). Under the RCMA, the Petitioner
    was to provide, inter alia, construction management services to
    Respondent No.1 for completion of the Rajapura Homes Project and in
G   connection with the handover of sold units of the Rajapura Homes Project.
    Likewise, under the SCMA, the Petitioner had to provide similar services
    to the Begur Company for the completion of the Southern Homes Project
    and in connection with the handover of the sold units. It is pertinent to
    mention that both the aforementioned Agreements also contained
H   selfsame arbitration clauses. Clause 11 of the Agreements contemplate
 DLF HOME DEVELOPERS LTD. v. RAJAPURA HOMES PVT. LTD.                          9
                  [SURYA KANT, J.]

that the seat and venue of Arbitration would be New Delhi, and the             A
arbitration would be governed by the Arbitration and Conciliation Act,
1996.
       6. As a consideration for the construction management services
to be provided by it under the SCMA and the RCMA, the Petitioner -
DHDL in terms of Clause 4 of the respective agreement, was entitled to         B
a “Fee”. Clause 4.1 and 4.2 of the SCMA and RCMA, stipulated that
upon concluding its construction obligations, DHDL would submit a written
notice of completion to Respondent No.1 and the Begur Company.
Thereafter, Respondent No. 1 or the Begur Company, as the case may
be, shall have the right to reject or confirm the completion of the Rajapura
Homes Project and the Southern Homes Project. The agreements further           C
specify that once Respondent No.1 and the Begur Company accepted
the notice of completion, Ressimo PCC would be obligated to invest a
sum of Rs.75 crores (75,00,00,000/-) in the Begur Company. The said
amount is to be dealt with in the manner prescribed under the SCMA
and RCMA. It is not in dispute that petitioner-DHDL intended to be the         D
indirect beneficiary of the said Rs.75 crores. To further clarify the
modalities of the “Fee” payable to DHDL under the SCMA and RCMA,
a Fee Computation Agreement dated 25.01.2017 was also executed
between Respondent No.1, the Begur Company and Respondent No.2
(hereinafter, “Fee Agreement”).
                                                                               E
       7. The Petitioner-DHDL issued a written notice dated 16.08.2019
certifying the completion of the Southern Homes Project pursuant to
Clause 4.2 of the SCMA and called upon the Begur Company to fulfill
its subsequent obligation. However, the Begur Company vide reply dated
30.08.2019, refused to accept it as a Valid Notice of completion under
clause 4.2 of the SCMA. The Begur Company alleged that there had               F
been a delay in completing the construction projects and that the Petitioner
had not complied with the “Information Covenant” contemplated in Clause
3.1 of the SCMA. The Begur Company further stated that the notice
was incomplete and lacked the necessary documents. Hence, while
refusing to accept the notice, the Begur Company called upon the               G
Petitioner to provide the required information and documents.
       8. The Petitioner also issued written notice dated 26.10.2019,
certifying the completion of the Rajapura Project pursuant to Clause 4.2
of the RCMA. Respondent No.1 vide its reply dated 27.01.2020 again
refused to accept it as a valid notice of completion and cited reasons of      H
10             SUPREME COURT REPORTS                         [2021] 12 S.C.R.


A    delay and non-completion of the Rajapura Homes Project, incomplete
     notice, amongst others. The record reveals that after the rejection of the
     notices dated 16.08.2019 and 26.12.2019, there were several
     communications between the parties; however, they were unable to
     resolve their differences.
B           9. The Petitioner subsequently vide letter dated 26.05.2020 issued
     a notice invoking arbitration under Clause 11 of the SCMA and RCMA.
     The Petitioner’s case was that the notice of completion dated 16.08.2019
     and 26.12.2019, which were issued pursuant to Clause 4.2 of the SCMA/
     RCMA, were unreasonably rejected by the Respondent(s). The
     Petitioner-DHDL alleged that the refusal of the Respondent Companies
C    to accept the notice of completion was a breach under the SCMA and
     RCMA and was aimed at avoiding Respondent No.2’s obligation to invest
     Rs.75 crores in the Begur Company as contemplated under the SCMA,
     RCMA and the Fee Agreement. The Petitioner further referred all
     disputes arising out of the RCMA and SCMA to a common and composite
D    Arbitral Tribunal comprising a sole arbitrator. The Petitioner also proposed
     two names, for one of them to be appointed as the sole arbitrator.
            10. The Respondents (i.e. Respondent No.1, the Begur Company
     and Respondent No.2) vide two separate emails, both dated 12.06.2020,
     however, refused to appoint a sole arbitrator. They stated that the dispute
E    between the parties was not whether Respondent No.2 had any obligation
     after accepting the respective notice of completions but whether or not
     completion in respect of the Rajapura Project and the Southern Homes
     Project has been achieved, which is an obligation on DHDL under Clause
     6 of the Rajapura SPA and Southern Homes SPA. It was thus claimed
     that the differences between the parties have arisen under the Rajapura
F    SPA and Southern Homes SPA and not under the RCMA/SCMA. The
     Respondents further refused to have the disputes consolidated into a
     common and composite tribunal and instead asserted that the same would
     have to be resolved under separate arbitration proceedings. Thereafter,
     on 13.06.2020, the Respondents issued two more letters through their
G    Counsel, Fresh fields Bruckhaus Deringer Singapore Pte. Ltd., reiterating
     that the disputes between the parties do not fall within the terms of the
     SCMA and RCMA. Further, the Respondent(s) reserved their right to
     invoke the dispute resolution provisions under the Southern Homes SPA
     and Rajapura SPA, respectively by instituting arbitral proceedings under
     the rules of SIAC.
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    DLF HOME DEVELOPERS LTD. v. RAJAPURA HOMES PVT. LTD.                     11
                     [SURYA KANT, J.]

       11. Aggrieved by the refusal of the Respondent(s) to appoint an       A
Arbitrator under the RCMA and SCMA, the Petitioner has preferred
these two separate petitions under Section 11(6) read with Section 11(12)
of the Act, praying for appointment of a sole arbitrator for resolution of
all disputes arising from the SCMA and RCMA. It may be highlighted
that since Respondent No.2 is not a body incorporated in India, the
                                                                             B
arbitration between the Parties falls within the ambit of ‘international
commercial arbitration’ as defined under Section 2(1)(f) of the Act.
        CONTENTIONS
       12. We have heard learned Senior Counsels appearing for the
parties at considerable length. Learned Senior Counsel appearing on          C
behalf of the Petitioner–DHDL contended that the Begur Company and
Respondent No.1 acted unreasonably in not accepting the notice of
completion. The rejection of the notice certifying the completion of
Rajapura Homes Project and Southern Homes Project was allegedly
done with the sole purpose of avoiding Respondent No.2’s obligation to
pay “Fee” to the Petitioner. He further pressed that the contention of       D
the Respondents that the disputes in question cannot be arbitrated under
the RCMA and SCMA is legally and factually misconceived.
       13. Drawing force from the decisions of this Court in the cases of
(i) Duro Felgura, S.A. v. Gangavaram Port Limited1, (ii) Garware
Wall Ropes Limited v. Coastal Marine Constructions and                       E
Engineering Limited2, (iii) Mayavati Trading Private Limited v.
Pradyuat Deb Burman3, and (iv) Vidya Drolia and Others v. Durga
Trading Corporation4, learned Senior Counsel for the Petitioner
submitted that this Court while dealing with an application under Section
11(6) of the Act has a narrow scope of examination, confined only to         F
trace out whether there exists an ‘arbitrable dispute’ and a ‘written
contract’ providing ‘arbitration’ as the Dispute Resolution Mechanism.
He canvassed that since the parties have not disputed the existence of
arbitration agreement or its core contractual ingredients contained in the
SCMA and RCMA, the present dispute, in terms of the settled law,
should be referred to arbitration. The recent decision of this Court in      G


1
  (2017) 9 SCC 729, ¶ 48 & 59
2
  (2019) 9 SCC 209, ¶14
3
  (2019) 8 SCC 714, ¶10
4
  (2021) 2 SCC 1, ¶236, 237, 244.3, 244.4, 244.5, 244.5.1–244.5.3            H
12                SUPREME COURT REPORTS                       [2021] 12 S.C.R.


A    Uttarakhand Purv Sainik Kalyan Nigam Limited v. Northern Coal
     Field Limited5, has also been relied upon to contend that once the
     existence of the arbitration agreement was established, all other incidental
     issues should be left to be decided by the arbitrator as prescribed under
     Section 16 of the Act, which enshrines the principle of “Kompetenz
     Kompetenz”. The contention appears to be that the Arbitral Tribunal
B
     would eventually rule whether or not the disputes between the instant
     parties fall under the terms of the SCMA and the RCMA.
            14. Learned Senior Counsel for the Petitioner further contended
     that although the RCMA and SCMA are two separate agreements, they
     are inextricably interlinked, and since the dispute in question relates to
C    payment of ‘Fees’ to the Petitioner for its services under both the
     Construction Management Agreements, the disputes may be referred to
     a common and consolidated arbitral tribunal. Reliance has been placed
     on the judgment of this Court in P.R. Shah, Shares and Stock Brokers
     Private Limited v. BHH Securities Private Limited and Others 6, to
D    urge that proceedings ought to be consolidated to avoid multiplicity of
     arbitrations and conflicting decisions, which would have the potential to
     cause injustice. In the alternative, it was prayed that this Court may
     appoint the same sole arbitrator in both the Arbitration Petitioner No.17
     of 2020 and Arbitration Petition No.16 of 2020, and leave the decision
     relating to consolidation of the arbitral proceedings to the discretion of
E    the sole arbitrator.
            15. Per Contra, learned Senior Counsel appearing on behalf of
     the Respondents vehemently controverted the case of DHDL and
     reiterated that the dispute sought to be raised in the present Arbitration
     Petitions exclusively falls within the ambit of Rajapura SPA and Southern
F    Homes SPA; therefore, the differences between the parties could not
     be referred to arbitration under the RCMA and SCMA. He argued that
     the Rajapura SPA and the Southern Homes SPA are the principal
     agreements governing the transaction between the parties, and the
     RCMA/SCMA were subsequently executed only to operationalise the
G    manner in which the Petitioner would fulfill its construction obligation as
     per Clause 6 of the respective Share Purchase Agreements. It was
     further alleged that while DHDL is intended to be the beneficiary of
     Rs.75 crores to be deposited by Respondent No.2, the economic interest

     5
         (2020) 2 SCC 455, ¶7.10, 7.11
H    6
         (2012) 1 SCC 594, ¶ 19
    DLF HOME DEVELOPERS LTD. v. RAJAPURA HOMES PVT. LTD.                          13
                     [SURYA KANT, J.]

of the Respondent(s) is confined to the undeveloped land, and the                 A
breaches on the part of the Petitioner concerning its obligations under
Clause 6 of the Share Purchase Agreements have made it difficult for
them to monetise the undeveloped land. It was therefore contended that
the instant disputes could only be arbitrated as per the dispute resolution
mechanism specified in Clause 9 of the Rajapura SPA/Southern Homes
                                                                                  B
SPA, namely, the Rules of SIAC with seat and venue of Arbitration at
Singapore. He urged that if the seat of Arbitration were to be found
outside India, i.e, Singapore, the instant Applications under Section 11(6)
of 1996 Act are not maintainable7.
       16. Citing the decisions of this Court in Duro Felgura, S.A.
(supra) 8 and Vidya Droila (supra) 9 , Senior Counsel for the                     C
Respondentscontended that while deciding an application under Section
11(6), this Court cannot act cursorily and an absolute ‘hands off’ approach
would be counterproductive. He drew support from the afore-cited
decisions to emphasise that this Court is required to examine whether
the agreement(s) in question contain a clause that provides for arbitration       D
in respect of the disputes which have actually arisen between the parties.
He drew our attention to the judgement in Olympus Superstructure
Pvt. Ltd. v. Meena Vijay Khetan and Others10, wherein, this Court
held that in a situation where there are disputes and differences in
connection with the main agreement and also disputes regarding other
matters connected thereto, the arbitration would be governed by the               E
general arbitration clause of the main agreement. Lastly, it was submitted
that in the event the present arbitration petitions are allowed, this Court
while following the principles laid down in Duro Felguero, S.A., (Supra)
and Indus Biotech Private Limited v. Kotak India Venture (Offshore)
Fund and Ors11, need to appoint separate arbitral tribunals under the             F
RCMA and SCMA, though it may comprise of the same sole arbitrator.
        ANALYSIS
      17. There is no gainsaying that by virtue of the Arbitration and
Conciliation (Amendment) Act, 2015, by which Section 11 (6-A) was
                                                                                  G
7
  Bharat Aluminum Company v. Kaiser Aluminum Technical Services Inc., (2012) 9
SCC 552, ¶117; Mankatsu Impex Private Limited v. Airvisual Limited (2020) 5 SCC
399,¶ 14, 16, 18-28
8
  ¶48
9
  ¶132, 134, 139, 147.2, 147.6, 147.7 & 147.10
10
   (1999) 5 SCC 651, ¶ 27, 28 & 30
11
   2021 SCC Online SC 268, ¶ 39                                                   H
14             SUPREME COURT REPORTS                          [2021] 12 S.C.R.


A    introduced, the earlier position of law as to the scope of interference by
     this Court at the stage of referral has been substantially restricted. It is
     also no more res integra that despite the subsequent omission of Section
     11(6-A) by the Arbitration and Conciliation (Amendment) Act, 2019, the
     legislative intent behind thereto continues to be a guiding force for the
     Courts while examining an application under Section 11 of the Act.
B
            18. The jurisdiction of this Court under Section 11 is primarily to
     find out whether there exists a written agreement between the parties
     for resolution of disputes through arbitration and whether the aggrieved
     party has made out a prima facie arbitrable case. The limited jurisdiction,
     however, does not denude this Court of its judicial function to look beyond
C    the bare existence of an arbitration clause to cut the deadwood. A three-
     judge bench in Vidya Drolia (Supra), has eloquently clarified that this
     Court, with a view to prevent wastage of public and private resources,
     may conduct ‘prima facie review’ at the stage of reference to weed out
     any frivolous or vexatious claims. In this context, the Court, speaking
D    through Sanjiv Khanna, J. held that:
           “154.2. Scope of judicial review and jurisdiction of the court under
           Sections 8 and 11 of the Arbitration Act is identical but extremely
           limited and restricted.
           154.3. The general rule and principle, in view of the legislative
E          mandate clear from Act 3 of 2016 and Act 33 of 2019, and the
           principle of severability and competence-competence, is that the
           Arbitral Tribunal is the preferred first authority to determine and
           decide all questions of non-arbitrability. The court has been
           conferred power of “second look” on aspects of non-arbitrability
F          post the award in terms of sub-clauses (i), (ii) or (iv) of Section
           34(2)(a) or sub-clause (i) of Section 34(2)(b) of the Arbitration
           Act.
           154.4. Rarely as a demurrer the court may interfere at Section 8
           or 11 stage when it is manifestly and ex facie certain that the
G          arbitration agreement is non-existent, invalid or the disputes are
           non-arbitrable, though the nature and facet of non-arbitrability
           would, to some extent, determine the level and nature of judicial
           scrutiny. The restricted and limited review is to check and protect
           parties from being forced to arbitrate when the matter is
           demonstrably “non-arbitrable” and to cut off the deadwood. The
H          court by default would refer the matter when contentions relating
 DLF HOME DEVELOPERS LTD. v. RAJAPURA HOMES PVT. LTD.                          15
                  [SURYA KANT, J.]

      to non-arbitrability are plainly arguable; when consideration in         A
      summary proceedings would be insufficient and inconclusive; when
      facts are contested; when the party opposing arbitration adopts
      delaying tactics or impairs conduct of arbitration proceedings. This
      is not the stage for the court to enter into a mini trial or elaborate
      review so as to usurp the jurisdiction of the Arbitral Tribunal but
                                                                               B
      to affirm and uphold integrity and efficacy of arbitration as an
      alternative dispute resolution mechanism.”
      N.V. Ramana, J. (as His Lordship then was) in his supplementary
opinion further crystalised the position as follows:
      “244. Before we part, the conclusions reached, with respect to           C
      Question 1, are:
      244.1. Sections 8 and 11 of the Act have the same ambit with
      respect to judicial interference.
      244.2. Usually, subject-matter arbitrability cannot be decided at
      the stage of Section 8 or 11 of the Act, unless it is a clear case of    D
      deadwood.
      244.3. The court, under Sections 8 and 11, has to refer a matter to
      arbitration or to appoint an arbitrator, as the case may be, unless a
      party has established a prima facie (summary findings) case of
      non-existence of valid arbitration agreement, by summarily               E
      portraying a strong case that he is entitled to such a finding.
      244.4. The court should refer a matter if the validity of the
      arbitration agreement cannot be determined on a prima facie basis,
      as laid down above i.e. “when in doubt, do refer”.
                                                                               F
      244.5. The scope of the court to examine the prima facie validity
      of an arbitration agreement includes only:
      244.5.1. Whether the arbitration agreement was in writing?
      Or
      244.5.3. Whether the core contractual ingredients qua the                G
      arbitration agreement were fulfilled?
      244.5.4. On rare occasions, whether the subject-matter of
      dispute is arbitrable?”
                                                      [Emphasis Applied]
                                                                               H
16             SUPREME COURT REPORTS                          [2021] 12 S.C.R.


A           19. To say it differently, this Court or a High Court, as the case
     may be, are not expected to act mechanically merely to deliver a
     purported dispute raised by an applicant at the doors of the chosen
     Arbitrator. On the contrary, the Court(s) are obliged to apply their mind
     to the core preliminary issues, albeit, within the framework of Section
     11(6-A) of the Act. Such a review, as already clarified by this Court, is
B
     not intended to usurp the jurisdiction of the Arbitral Tribunal but is aimed
     at streamlining the process of arbitration. Therefore, even when an
     arbitration agreement exists, it would not prevent the Court to decline a
     prayer for reference if the dispute in question does not correlate to the
     said agreement.
C
            20. Keeping the settled position of law in mind, the foremost
     question that arises for our consideration is whether the nature of dispute
     sought to be referred for arbitration in these petitions fall under the
     Arbitration Clause(s) of RCMA and SCMA, governed by the Arbitration
     and Conciliation Act, 1996, with the seat and venue for arbitration at
D    New Delhi or such disputes can be arbitrated only in terms of the dispute
     resolution mechanism specified in Clause 9 of the Rajapura SPA/Southern
     Homes SPA i.e. under the rules of the Singapore International Arbitration
     Centre and the seat and venue of the arbitration at Singapore?
             21. With a view to analyse and answer the afore-stated question,
E
     it is essential to understand the nature of the two sets of agreements
     executed between the parties from time to time and the subsequent
     amendments thereof.
            22. The first set of agreements comprises of two Share Purchase
F    Agreements. Rajapura SPA was executed on 08.07.2016, whereunder
     the Petitioner, Respondent No.1 and Respondent No.2 agreed to the
     sale of shares of Respondent No.1 by DHDL in favour of Respondent
     No.2/Resimmo PCC as ‘the purchaser’. The Southern Homes SPA dated
     25.01.2017 also pertains to the sale of shares of the Begur Company by
     DHDL to Respondent No.2. Although these are two agreements but the
G    agreed terms are materially same except the total equity shares agreed
     to be sold and the location of the residential projects. We thus, for the
     sake of brevity, propose to re-produce the following relevant clauses
     from the Rajapura SPA:-

H
DLF HOME DEVELOPERS LTD. v. RAJAPURA HOMES PVT. LTD.                        17
                 [SURYA KANT, J.]

    “1. DEFINITIONS AND INTERPRETATION                                      A
    1.1 Definitions
    ...
          “Rajapura Projects Completion” shall have the meaning
          ascribed in Clause 6.3;                                           B
    …
    2. AGREEMENT TO SELL AND PURCHASE THE SALE
    SHARES
    2.1 Subject to the terms and conditions of this Agreement,              C
    the Seller agrees to sell the Purchaser, and the Purchaser
    agrees to purchase from the Seller, on the Closing Date,
    the Sale Shares free and clear from all Encumbrances,
    together with all rights, title and interests arising therefrom
    (including all rights and advantages now and hereafter                  D
    attaching or accruing thereto), such that the Purchaser shall,
    upon completion of the sale of the Sale Shares in its name,
    receive full legal and beneficial ownership of the said Sale
    Shares and all rights and benefits relating thereto and arising
    thereof.
                                                                            E
    2.2 The Sale Shares shall be purchased by the Purchaser in their
    entirety on the Closing Date. The Seller shall have the right to
    refuse to sell the Sale Shares to the Purchasers if the Purchasers
    is unwilling to purchase or does not purchase in entirety the Sale
    Shares on the Closing Date.
                                                                            F
    …
    3. CONDITIONS PRECEDENTS
    3.1 The Seller shall do all acts, deeds and things (including
    by exercising their voting rights at Board and shareholder
    meetings) and shall execute all documents necessary,                    G
    incidental or ancillary to the fulfillment of the conditions
    set out in SCHEDULE II (the “Conditions Precedent”). If
    any Party becomes aware of any event or circumstance that will
    or may prevent any of the Conditions Precedent from being
    satisfied, on or prior to the Closing Date, it shall forthwith notify   H
18       SUPREME COURT REPORTS                         [2021] 12 S.C.R.


A    the other Parties in writing of such event or circumstance and the
     Parties shall take such action and steps as may be required (to
     the extent within a Party’s control) to remove the event/
     circumstances without imposing any liability on any other Party
     and without the prior written consent of such other Party.
B    …
     3.3 The obligation of the Purchaser to purchase Sale Shares and
     pay the Sale Consideration on the Closing Date in the manner
     specified in this Agreement, shall be conditional upon fulfilment
     by the Seller (or where permissible under applicable Law, waiver
C    in writing by the Purchaser in its sole discretion) of the Conditions
     Precedent.
     …
     6. CONSTRUCTION RELATED OBLIGATIONS OF THE
     SELLER
D
     6.1 The Seller shall, through appropriate contractors to be
     appointed by the Company (in accordance with the terms of
     the Construction Agreement), as per the terms set out in
     SCHEDULE V and to be set out in the Construction
     Agreement proposed to be executed as a Condition Precedent,
E
     ensure (i) completion of construction of the Rajapura Phase II
     Project on or prior to December 31, 2016, (ii) obtain the occupation
     certificate for the Project on or prior to December 31, 2016; and
     (iii) where applicable, hand over possession of units of the Rajapura
     Projects to the purchasers of units or the Company (as and when
F    required pursuant to the applicable sales contracts and/or Law
     but subject to the aforementioned time limit) until the later of (i)
     12 (twelve months) from receipt of the occupation certificate for
     the Rajapura Phase II Project, the timeline for completion of the
     Rajapura Phase II Project shall, subject to the Seller taking
     reasonable steps to minimize the impact of the Force Majeure
G    event, be extended from December 31, 2016 by such period as
     for which such Force Majeure event subsists. The obligation of
     the Seller with respect to handover after expire of the
     aforementioned time period shall be as set out in the Construction
     Agreement. Provided however that any unit for which final
H    demand has been raised by the Company but for which possession
DLF HOME DEVELOPERS LTD. v. RAJAPURA HOMES PVT. LTD.                        19
                 [SURYA KANT, J.]

    has not been taken over by the customer despite 2 (two) written         A
    reminders and passage of 4 (four) months from the raising of the
    final demand shall be deemed to have been handed over for the
    purpose of completion of the Construction Covenant. Further, Seller
    shall write to the Anekal Planning Authority in relation to the
    completion certificate for Rajapura Phase II Project, requesting
    that the completion certificate dated December 12, 2016 reference       B
    number APA/LAO/59/2011-12 be deemed final as Company has
    decided to abandon the construction of towers W and X in Building
    No. 6 of the Rajapura Phase II Project, get an acknowledgment
    of receipt of the application from Anekal Planning Authority, and
    make reasonable efforts to obtain an endorsement on the application     C
    from Anekal Planning Authority.
    6.2 In addition, the Seller shall, through appropriate
    contractors to be appointed by the Company (in accordance
    with the terms of the Construction Agreement), on or prior
    to March 31, 2018, as per the terms to be set out in the                D
    Construction Agreement proposed to be executed as a
    Condition Precedent, ensure completion of construction of
    the club house of 2,469.33 (two thousand four hundred sixty
    nine point three three) square metres built up area and 2,469.33
    (two thousand four hundred sixty nine point three three) square
    metres built up area and 2,446.25 (two thousand four hundred            E
    forty six point two five) square metres FAR area in the Rajapura
    Projects as per the terms set out in SCHEDULE V (“Club
    Construction”); provided that in the event that a Force Majeure
    event materially impacts the Club Construction, the timeline for
    completion of the Club Construction shall, subject to the Seller        F
    taking reasonable steps to mitigate the impact of the Force Majeure
    event, be extended from March 31, 2018 by such period as for
    which such Force Majeure event subsists.
    …
                                                                            G
    9. DISPUTE RESOLUTION
    All disputes or differences regarding this Agreement shall be
    submitted to final and binding arbitration at the request of any of
    the disputing Parties upon written notice to that effect to the other
    Parties. In the event of such arbitration:
                                                                            H
20               SUPREME COURT REPORTS                     [2021] 12 S.C.R.


A          (i)     The arbitration shall be in accordance with the rules
                   of the Singapore International Arbitration Centre
                   (“SIAC”), in force at the relevant time (which is
                   deemed to be incorporated into this Agreement by
                   reference);
B          (ii)    All proceedings of such arbitration shall be in the
                   English language. The venue of the arbitration shall
                   be Singapore, which shall be the seat of the
                   arbitration;
           …
C                                                        [Emphasis Applied]
           23. It may be mentioned that the Rajapura SPA was mutually
     amended by agreements dated 25.01.2017 and 16.03.2017. Similarly,
     the Southern Homes SPA was also amended by an agreement dated
     16.03.2017. The relevant clauses extracted above have taken notice of
D    the amendments conjointly carried out by the parties.
            24. In terms of Clauses 3.1, 6.1 and 6.2 of Share Purchase
     Agreements, as re-produced above, the parties entered into two
     Construction Management Service Agreements dated 25.01.2017 in
     respect of Rajapura Project (RCMA) and Southern Homes Project
E    (SCMA). Since both these agreements are also in boilerplate language,
     the following relevant clauses of the RCMA are extracted:
           “2. ENGAGEMENT & SCOPE OF SERVICES
           2.1 On the terms and subject to the conditions set out in this
           Agreement DHDL undertakes to provide construction
F
           management services to the Company in relation to the completion
           (pursuant to the receipt of appropriate occupation certificates) of
           the Rajapura Projects and services in connection with the handover
           of sold units in the Rajapura Projects and Construction Covenant
           (collectively, the “Services”). The scope of the Services shall
G          include:
           (i)     Monitoring and supervising the work being undertaken by
                   the project management consultant appointed for the
                   Rajapura Projects in accordance with the terms of the PMC
                   Contract:
H
DLF HOME DEVELOPERS LTD. v. RAJAPURA HOMES PVT. LTD.                      21
                 [SURYA KANT, J.]

    (ii)    Monitoring and supervising of works being undertaken by       A
            the various contractors appointed in accordance with the
            terms of the Existing Construction Contracts and Sub-
            Contracts:
    (iii)   Evaluation of prospective contractors for award of
            construction works for the Rajapura Projects Completion:      B
    (iv)    Finalization and execution, on behalf of the Company, of
            construction contracts with identified contractors for
            Rajapura Projects Completion; (“New Construction
            Contracts”), in accordance with the Approved Budget,
            provided that the cost pursuant to this Clause 2.1 (iv) may   C
            exceed up to a cap of 25% (twenty five per cent) over the
            cost estimates in the Approved Budget:
    (v)     Monitoring and supervising of works being undertaken by
            the various contractors appointed in accordance with the
            terms of the New Construction Contracts:
                                                                          D
    …
    4. FEES AND EXPENSES
    4.1 In consideration of the Services to be provided by DHDL
    and performance of the terms of this Agreement, DHDL
    shall be entitled subject to the terms and conditions                 E
    contained in this Agreement, to the Fees and the Company
    shall pay to DHDL the Fees (in the manner set out in this
    Clause 4), after deduction of any withholding tax required
    to be withheld deducted in accordance with Applicable Law.
    4.2 Forthwith upon completion of the Construction                     F
    Covenant and receipt of the occupation certificate in respect
    of each of the projects comprised in the Rajapura Projects,
    DHDL shall send a written notice to the Company certifying
    fulfilment of completion of the Rajapura Projects, and
    enclose certified true copies of all necessary documents
    evidencing fulfilment of the same and the Company shall               G
    have the right to reject or confirm the fulfilment, within a
    period of 15 (fifteen) days from the date of receipt of the
    aforementioned written notice from DHDL, provided that
    the Company shall act reasonably in exercising such right,
    and receipt of occupation certificate from an appropriate             H
22         SUPREME COURT REPORTS                      [2021] 12 S.C.R.


A    Governmental Authority will signify completion of any
     building. In case the Company fails to respond to the said
     certificate within a period of 15 (fifteen) days, then the
     Company shall be deemed to have accepted the fulfilment
     of completion of the relevant project comprised in the
     Rajapura Projects.
B
     4.3 Immediately upon receipt of the Rs.750,000,000 (Rupees Seven
     Hundred and Fifty Million) by Southern Homes in the manner
     contemplated under Clauses 4.3 or
     4.4 (as the case may be) of the Southern Homes Construction
C    Agreement, the Company shall deposit an amount of
     Rs.150,000,000 (Rupees One Hundred and Fifty Million) into a
     separate bank account of the Company identified by Resimmo
     and, notwithstanding anything to the contrary contained in the
     Agreement, the Company shall be entitled to deal with this amount
     of Rs.150,000,000 (Rupees One Hundred and Fifty Million) in
D    such manner as determined by its Board and the balance shall be
     dealt with as per the hierarchy of payment set out in Clause 3.8
     above.
     11. DISPUTE RESOLUTION

E    Subject to Clause 4.6, all disputes or differences regarding this
     Agreement shall be submitted to final and binding arbitration at
     the request of any of the Parties upon written notice to that effect
     to the other Party. In the event of such arbitration:
     (i)     The arbitration shall be in accordance with the
F            Arbitration and Conciliation Act, 1996, in force at the
             relevant time (which is deemed to be incorporated
             into this Agreement by reference);
     (ii)    All proceedings of such arbitration shall be in the
             English language. The venue of the arbitration shall
             be New Delhi, which shall be the seat of the arbitration
G
             and the courts of New Delhi shall have exclusive
             jurisdiction over the arbitration proceedings;
     (iii)   The arbitration shall be conducted before a sole
             arbitrator appointed jointly collectively by the Parties.
             In the event that the Parties are unable to agree on a
H
 DLF HOME DEVELOPERS LTD. v. RAJAPURA HOMES PVT. LTD.                            23
                  [SURYA KANT, J.]

              sole arbitrator within 15 (fifteen) Business Days                  A
              following submission of the dispute to arbitration, the
              arbitrator shall be appointed in the manner prescribed
              under the Arbitration and Conciliation Act, 1996.”
       …
                                                        [Emphasis Applied]       B

       25. The ‘Share Purchase Agreements’ as well as the ‘Construction
Management Agreements’ are subsisting and have not been repudiated
by the Parties. Both sets of agreements contain arbitration clauses that
are not similar to one another. We are, therefore, of the considered opinion
that in order to determine the nature of arbitral proceedings, the two           C
groups of agreements will have to be read in harmony and reconciled so
as to avoid any head on collision, and thereafter a conclusion as to which
of the clauses would be applicable in the present case, needs to be drawn.
       26. Upon perusing the Share Purchase Agreements, it is clear
that the primary purpose of these agreements is to effectuate the change         D
of ownership of Respondent No.1 and the Begur Company from DHDL
to Resimmo PCC. No doubt, the Rajapura SPA and the Southern Homes
SPA as per their Clause 6.1 and 6.2, do provide for the completion of the
respective residential projects as a post-closing obligation, however, these
construction obligations had to be fulfilled in accordance with the terms        E
of the ‘Construction Agreements’. The very purpose of the RCMA and
SCMA was, on the other hand, to operationalise the manner in which
the Petitioner-DHDL would achieve the said construction related
obligations. The construction agreements not only contemplate the scope
of services to be provided by the petitioner but also lays down the obligation
on Respondent No.2 to pay “Fee” to the Petitioner-DHDL upon                      F
completion of the residential projects. A prima facie reading of ‘Share
Purchase Agreements’ and ‘Construction Management Agreements’,
does suggest that notwithstanding certain overlaps between these
agreements, their object and field of operation is different and distinct in
nature. It is therefore difficult for us to accept it outrightly that the        G
respective Share Purchase Agreements are the ‘principal agreements
governing the transaction’ between the parties or that the present disputes
can be resolved solely under the arbitration clause contained therein.
    27. The dispute sought to be referred to arbitration by the Petitioner
DHDL pertains to non-deposit of agreed amount by Respondent No.2
                                                                                 H
24             SUPREME COURT REPORTS                          [2021] 12 S.C.R.


A    and resultant payment thereof as ‘Fee’ which the Petitioner claims in
     terms of clause 4 of RCMA/SCMA. Whether or not the Petitioner has
     complied with the ‘condition precedent’ under Rajapura SPA and thus
     has become entitled to ‘fee’ as per clause referred to above, is purely a
     question of fact to be determined by the Arbitral Tribunal.
B           28. We may at this stage also briefly refer to the judgment of this
     Court in Olympus Superstructure (Supra), wherein this Court faced
     two different arbitration clauses in two related agreements between the
     same parties. The main agreement therein was concerned with the selling
     of certain flats, and the related agreement was an Interior Design
     Agreement, both of which contained an arbitration clause that was not
C
     similar to each other. Since two valid arbitration clauses existed and the
     parties were relying upon the different arbitration clauses, this Court
     harmonised both the clauses and viewed that the arbitration clause in
     the main agreement was worded in wide terms and specifically
     contemplated issues that were in “any way connected with, arising
D    out of or in relation to the subject matter of the arbitration
     agreement”. This Court, therefore, aptly held that since the disputes
     arising from the Interior Design Agreement were intrinsically “connected
     with” the disputes and differences arising out of the main contract, such
     dispute could also be adjudicated under the main agreement itself.
E           29. The nature of arbitration clauses in the present case are
     substantially different when compared with the dispute resolution clause
     of the main agreement in Olympus Superstructure (Supra). The
     arbitration Clause 9 of the Rajapura SPA/Southern Homes SPA does
     not have any overriding effect and is in no way broader or wider when
     compared to Clause 11 of the RCMA/SCMA. Therefore, even if we
F
     were to assume that the present differences between the parties are
     incidental to the terms of the Share Purchase Agreements, it is difficult
     to construe that Clause 9 of Share Purchase Agreements contemplates
     adjudication of the issues that are “connected with” or are “in relation”
     to the subject matter of the Share Purchase Agreements.
G
            30. Further, if the Respondent(s) plea, that present dispute(s) should
     be arbitrated only under the Rajapura SPA/Southern Homes SPA is
     accepted at face value, the eventual result would be that any and all
     disputes relating to the Petitioner’s construction obligation would be
     arbitrable under the provisions of the Share Purchase Agreements only.
H
 DLF HOME DEVELOPERS LTD. v. RAJAPURA HOMES PVT. LTD.                          25
                  [SURYA KANT, J.]

But then, what would be the purpose of having a separate arbitration           A
clause 11 under the RCMA/SCMA? The parties do not seem to have
rendered the arbitration clause in RCMA and SCMA as redundant, more
so when these are the agreements later in time. It, thus, appears to us
that the scope of the arbitration clause in Rajapura SPA/Southern Homes
SPA is limited to issues relating to the agreement’s primary subject matter,
                                                                               B
i.e., any dispute arising out of the transaction of sale and purchase of
shares. The provisions of the RCMA/SCMA, and the arbitration clause
therein, would as a logical corollary then be applicable to any dispute/
difference concerning the performance of the construction related
obligations and deposit of agreed amount by Respondent No.2 or payment
thereof to the Petitioner-DHDL.                                                C
       31. The Petitioner has not once alleged in these Petitions that the
dispute sought to be referred to Arbitration emanates from the Share
Purchase Agreements. As far as the share transactions between the
Petitioner and Respondent No.2 is concerned, learned Senior Counsel
for the Petitioner has unequivocally submitted that the purchase of shares     D
by Respondent No.2 has been duly completed. There is nothing on record
to suggest that Respondent No.2 is aggrieved by non-compliance,
deviation or breach of promise to sell its shares by the Petitioner-DHDL.
On the contrary, the counter-affidavit filed by the Respondent(s) indicates
that the sale of the shares of Respondent No.1 and the Begur Company
                                                                               E
have been completed. Still further, it is not the case that Ressimo PCC
has already invoked Clause 9 of the Rajapura SPA or of the Southern
Homes SPA. Thus, when neither party has pleaded the infringement of
the core provisions of the Share Purchase Agreements, it is difficult to
accept outrightly that the subject-controversy falls within the ambit of
Clause 9 of the said agreements and can be adjudicated only under the          F
rules of SIAC, with seat and venue at Singapore.
       32. At the cost of repetition, we may re-iterate that the Parties
have neither denied that there is no ‘arbitrable dispute’ between them
nor have they challenged the existence of the arbitration clause(s) in the
Construction Management Service Agreements. Considering that the               G
primary twin-test envisioned under Section 11(6) of the Act has been
satisfied by the Petitioner-DHDL, we are of the view that the instant
application(s) are maintainable. The nature of disputes that have arisen
between the parties, thus, can be adjudicated in the arbitral proceedings
under Clause 11 of the RCMA and SCMA.
                                                                               H
26            SUPREME COURT REPORTS                          [2021] 12 S.C.R.


A           33. It goes without saying, that if on appreciation of the facts and
     law, the arbitrator finds that the ‘real dispute’ between the parties stems
     from the Share Purchase Agreements dated 08.07.2016 and 25.01.2017,
     the arbitrator shall be free to wind up the proceedings with liberty to the
     Parties to seek redressal under the rules of SIAC.
B           34. We may now briefly deal with the question whether the
     disputes should be referred to a consolidated and composite tribunal or
     should there be two different arbitral tribunals to resolve the same. It
     was urged on behalf of the Petitioner that since the RCMA and SCMA
     are inextricably interlinked to each other, the dispute/difference cannot
     be segregated into two separate proceedings. It was pointed out that the
C    obligation of computation/determination and payment of “Fee” to the
     Petitioner arises out of the SCMA, the RCMA and the Fee Agreement,
     and under the Fee Agreement, the parties have to calculate the “DLF
     Receivables”. Such DLF Receivables have to be computed taking into
     account financial components/accounts of both, the Southern Homes
D    Project and the Rajapura Homes Projects. It was thus submitted that in
     order to avoid multiplicity of proceedings which may result in conflicting
     awards, the sum of disputes may be referred to a single and composite
     arbitral tribunal.
            35. The fact remains that the RCMA and SCMA, though
E    interlinked and connected, are still two separate agreements. We also
     cannot lose sight of the fact that the case of the Respondent(s) is that
     the Petitioner has committed breaches under both RCMA as well as
     SCMA, and that the genesis of the disputes lies in separate and distinct
     facts. Save where the parties have resolved to the contrary, it would be
     inappropriate to consolidate the proceedings originating out of two
F    separate agreements. However, since the Fee Agreement provides that
     the “Fee” can only be calculated after taking into consideration various
     financial components of both the Rajapura Homes Projects and the
     Southern Homes Project, it would be necessary for the sake of avoiding
     wastage of time and resources, and to avoid any conflicting awards, that
G    the disputes under Arbitration Petition No.17 and Arbitration Petition
     No.16 are referred to a sole Arbitrator. We leave it to the wisdom of the
     sole arbitrator to decide whether the disputes should be consolidated
     and adjudicated under one composite award or otherwise. The modalities
     and manner in which the two separate arbitral proceedings shall be
     conducted shall also be resolved by the sole arbitrator.
H
 DLF HOME DEVELOPERS LTD. v. RAJAPURA HOMES PVT. LTD.                          27
                  [SURYA KANT, J.]

      CONCLUSION                                                               A
      36. In light of above discussion, Arbitration Petition No. 16 of
2020 and Arbitration Petition No.17 of 2020 are allowed. This Court
appoints Mr. Justice (Retd.) R.V. Raveendran, Former Judge, Supreme
Court of India as the sole arbitrator to resolve all disputes/differences
between the parties. The arbitrator will be paid fees in accordance with       B
the Fourth Schedule of the Arbitration and Conciliation Act, 1996 as
amended from time to time.
      37. A copy of this order be dispatched to Mr. Justice (Retd.) R.V.
Raveendran, Former Judge, Supreme Court of India at the following
address:                                                                       C
      “Mr. Justice (Retd.) R. V. Raveendran
      Former Judge, Supreme Court of India
      No. 8/2, Krishna Road, Basavangudi
      Bangalore - 560004.
                                                                               D
      Telephone Number: 080-26601279
      Mobile Number: 09654500060"


Divya Pandey                                              Petitions allowed.
                                                                               E




                                                                               F




                                                                               G




                                                                               H