Calcutta High Court Refers DVC Tariff and IBC-Linked Claims to Sole Arbitration
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TL;DR
- Calcutta High Court appointed a sole arbitrator for disputes between Damodar Valley Corporation and Debeanjana Hard Coke.
- The dispute arises from unpaid differential tariff and additional electricity dues under a Power Supply Agreement.
- Proceedings under Section 9 of the Insolvency and Bankruptcy Code are pending before NCLT, Kolkata.
- All issues including limitation and arbitrability are left open for determination by the arbitral tribunal.
Overview
The Calcutta High Court issued an order appointing a sole arbitrator to adjudicate disputes between Damodar Valley Corporation and Debeanjana Hard Coke Private Limited. The dispute relates to unpaid differential tariffs and electricity dues linked to a Power Supply Agreement. Outstanding claims also prompted IBC proceedings, and both parties agreed to arbitration.
What Happened
Damodar Valley Corporation (DVC) and Debeanjana Hard Coke entered into a Power Supply Agreement in 2006, under which DVC claims unpaid differential tariffs for electricity supplied from 2006 to 2013, as well as additional outstanding electricity dues.
DVC issued a final bill on January 1, 2021, and, after non-payment, sent a disconnection notice in September 2022 and subsequently disconnected the supply.
IBC proceedings (Section 9) were initiated by DVC and remain pending before the NCLT, Kolkata.
Following an arbitration notice under Section 21 of the Arbitration and Conciliation Act and mutual consent, the Calcutta High Court was approached for arbitrator appointment under Section 11(6).
Both parties agreed to appoint Mr. Mainak Bose, Senior Advocate, as sole arbitrator. The Court left all substantive and procedural issues, including limitation, for the arbitral tribunal to decide.
Context
The dispute centers on long-outstanding electricity tariff differences determined by regulatory authority and related supply bills, illustrating intersecting issues under India's Arbitration and Conciliation Act, 1996 and the Insolvency and Bankruptcy Code, 2016.
The agreed shift to a sole arbitrator, rather than a three-member panel originally contemplated in the contract, reflects consent by both parties and judicial efficiency in resolving business disputes.
Why It Matters
- The order enables arbitration to proceed on complex, multi-year utility and insolvency-linked claims, rather than pre-judging the merits or procedural objections.
- The approach preserves party autonomy, allowing the appointed arbitrator to determine issues such as arbitrability, admissibility, and limitation.