No written arbitration agreement? No Section 11(6) petition, says SC

The brothers had no written arbitration agreement. So when the arbitrator stalled, one brother went to the High Court to replace him. The Supreme Court's answer: you went to the wrong court, with the wrong remedy, under the wrong section.

Two brothers, one family property dispute, and a sole arbitrator who stopped working after March 2009. The arbitrator had been appointed on August 4, 2008, by mutual consent—no written agreement, no signed contract, just a handshake that sealed the understanding that this person would resolve their partition dispute. That handshake, perhaps firm and hopeful in a family home, was the only contract they had. When the arbitrator stalled, the legal machinery began to grind, but the Supreme Court's judgment in Swadesh Kumar Agarwal v. Dinesh Kumar Agarwal & Ors. exposed a fundamental misunderstanding: not every arbitration problem can be fixed with a Section 11(6) (the High Court's power to appoint an arbitrator when the agreed procedure has failed) application.

When the arbitrator went silent

The Agarwal brothers had a family dispute over partition of properties. They did what many Indian families do—they mutually agreed to refer the dispute to a sole arbitrator. No written arbitration agreement. No formal contract spelling out how the arbitrator would be appointed or replaced. Just a shared decision: this person will decide.

The arbitrator was appointed on August 4, 2008. For about seven months, proceedings moved. Then, after March 2009, everything stopped. The arbitrator did not act. He did not resign. He simply stalled. The stack of case files on his desk, perhaps gathering dust in a quiet office, grew thicker with each passing month. The silence from the arbitrator's chamber was absolute.

Some family members revoked the arbitrator's mandate by letters dated July 11, 2009, citing delay. They then filed applications in the District Court under Section 14(1)(a) (the provision that lets a party ask the court to terminate an arbitrator's mandate when the arbitrator has failed to act without undue delay). The other side responded by filing an application under Order VII Rule 11 of the Code of Civil Procedure, 1908 (a procedural tool that asks the court to reject a plaint if it does not disclose a cause of action).

The High Court's intervention

While the District Court applications were pending—still gathering dust in the trial court's registry—one party took a different route. They approached the High Court of Madhya Pradesh at Jabalpur under Section 11(6) of the Arbitration Act (the provision that allows the court to appoint an arbitrator when the agreed appointment procedure has failed). The High Court terminated the sole arbitrator's mandate and appointed a fresh arbitrator.

The aggrieved party appealed to the Supreme Court. Their argument was sharp and simple: Section 11(6) does not apply here because there was no written arbitration agreement. The arbitrator was mutually appointed. The remedy for terminating a mandate under Section 14(1)(a) lies before the 'court' as defined under Section 2(e) of the Act (the District Court, not the High Court exercising its Section 11(6) powers).

What Section 11(6) actually requires

The Supreme Court bench—Justice M.R. Shah and Justice B.V. Nagarathna—delivered judgment on May 5, 2022. The courtroom in New Delhi must have been still as the bench read out its reasoning. The court drew a critical distinction between two provisions that practitioners often conflate.

Section 11(5) applies when parties have not agreed on a procedure for appointing an arbitrator. In that situation, the court can step in and appoint a sole arbitrator. Section 11(6) applies only when parties have agreed on an appointment procedure in writing, and that procedure has failed. The two provisions serve different situations. They cannot be merged.

The court held: "An application under Section 11(6) is maintainable only where there is a contract between the parties containing an arbitration agreement with a prescribed appointment procedure agreed upon in writing." Where parties mutually appoint an arbitrator without any written agreement, Section 11(6) is not attracted. The brothers had no written arbitration agreement. The High Court should never have entertained the Section 11(6) application.

The proper remedy for a stalled arbitrator

The court then clarified what the correct route should have been. When a controversy arises regarding termination of an arbitrator's mandate under Section 14(1)(a), the aggrieved party must approach the 'court' as defined under Section 2(e) of the Act (the District Court, or the High Court exercising ordinary original civil jurisdiction) under Section 14(2). That court must adjudicate whether the arbitrator has become unable to perform functions or has failed to act without undue delay.

This is not a Section 11(6) function. The High Court, when acting under Section 11(6), is not the 'court' under Section 2(e). It is exercising a different, limited jurisdiction. The two roles are distinct, and the Supreme Court's ratio made this separation explicit: the remedy under Section 14(2) is a substantive adjudication before a court of original civil jurisdiction, not a summary appointment power under Section 11(6).

The court also applied Section 15(2) of the Act: when an arbitrator's mandate is terminated and a substitute is to be appointed, the same procedure that was followed at the time of the initial appointment must be followed for the substitute appointment. Since the brothers had mutually appointed the arbitrator without any written procedure, the substitute would also need to be mutually appointed—not imposed by the High Court under Section 11(6). This principle ensures that the parties' original autonomy is preserved even when the first arbitrator fails.

The judgment further clarified the relationship between Sections 12 and 13 of the Act, which deal with grounds for challenging an arbitrator and the procedure for such challenges. The court noted that these provisions, while cross-referenced, do not override the specific mechanism under Section 14(1)(a) read with Section 14(2) for cases where an arbitrator has failed to act. The scheme of the Act, the bench reasoned, provides a complete code for dealing with arbitrator incapacity or inaction, and parties must follow that code rather than improvise remedies.

What the trial court got right

The Supreme Court also addressed the trial court's decision on the Order VII Rule 11 application. The trial court had dismissed the application to reject the plaint. The Supreme Court upheld this, applying a well-settled principle: at the stage of deciding an application under Order VII Rule 11 CPC, only the averments and allegations in the application or plaint are to be considered. The written statement, reply, or defence cannot be examined. On that limited ground, the trial court's decision was correct.

This aspect of the judgment reinforces a procedural discipline that trial courts must observe. The temptation to look at the defence while evaluating a plaint's maintainability is real, but the law forbids it. The Supreme Court's affirmation of this principle in the context of the Agarwal dispute serves as a reminder to all civil courts: the plaint stands or falls on its own allegations.

Precedents that shaped the decision

The Supreme Court relied on several key precedents to arrive at its conclusion. In Antrix Corporation Limited v. Devas Multimedia Private Ltd. (2014) 11 SCC 560, the court had earlier examined the scope of Section 11(6) and emphasized that the provision is triggered only when there is a failure of an agreed procedure. In S.P. Singla Constructions Pvt. Ltd. v. State of Himachal Pradesh (2019) 2 SCC 488, the court reiterated that the appointment of an arbitrator under Section 11(6) is a judicial function requiring careful scrutiny of the arbitration agreement. The bench also cited ACC Limited v. Global Cements Limited (2012) 7 SCC 71 and Union of India v. Uttar Pradesh State Bridge Corporation Limited (2015) 2 SCC 52 to reinforce the distinction between the different appointment mechanisms under the Act.

These precedents collectively establish that the Arbitration and Conciliation Act, 1996, does not permit a party to bypass the statutory framework simply because the mutually chosen arbitrator has stalled. The remedy lies in the Act itself, not in creative litigation strategies.

Why this matters for every arbitration practitioner

This judgment is a procedural trap that catches even experienced litigators. The instinct when an arbitrator stalls is to rush to the High Court under Section 11(6) and ask for a replacement. The Supreme Court has now made clear: that instinct is wrong unless there is a written arbitration agreement with a prescribed appointment procedure.

For mutually appointed arbitrators—the most common arrangement in family settlements and small commercial disputes—the remedy lies in the District Court under Section 14(2). The High Court under Section 11(6) has no jurisdiction to terminate a mutually appointed arbitrator's mandate or substitute a new one. The file of the stalled arbitration, thick with unanswered correspondence and unmarked dates, must be taken to the right forum.

THE PLAY: Before filing a Section 11(6) application, check one thing: was there a written arbitration agreement with a prescribed appointment procedure? If not, file under Section 14(2) before the District Court instead.

The brothers' dispute continues. The District Court applications under Section 14(1)(a) remain pending. The arbitrator's mandate may still be terminated—but by the right court, under the right provision. The handshake that began the arbitration must now be followed by the correct legal steps, not by a shortcut that the Supreme Court has firmly closed.