Arbitrability of GST-linked price revision upheld, with a contractual dispute found fit for sole arbitrator appointment.

A dispute over whether the agreed unit price could be unilaterally reduced because of a GST rate cut fell within the arbitration clause covering disputes arising out of or in connection with the contract. The court treated the issue as a live contractual controversy involving rights and liabilities, not a merely administrative matter. On that basis, the dispute was held arbitrable, and the petitioner's request for appointment of a sole arbitrator was maintainable after the respondent did not accept the nomination.

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Issues: Whether the controversy relating to reduction of the agreed unit price consequent to reduction in GST rate constituted a dispute referable to arbitration and justified appointment of a sole arbitrator.

Analysis: The agreement contained an arbitration clause covering disputes or differences arising out of or in connection with the contract. The controversy was not illusory or merely administrative, because it directly concerned whether the respondent could unilaterally reduce the agreed price per unit on the basis of GST rate reduction. That question involved contractual rights and liabilities and therefore disclosed a live dispute capable of being resolved through arbitration. Since the petitioner invoked the arbitration clause and the respondent did not accept the nomination, the request for appointment of an arbitrator was maintainable.

Conclusion: The dispute was held to be arbitrable, and appointment of a sole arbitrator was warranted in favour of the petitioner.

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