Term "Can" Not Be Used As An Escape Route From Arbitration

Recently, in the case of Panasonic India Pvt. Ltd. vs. Shah Aircon Through Its Proprietor Shadab Raza,¹ the Single Bench of Hon'ble Delhi High Court held that mere use of the term "can" in an Arbitration Clause, cannot render the intention of the parties to refer the dispute to arbitration, ineffective. The intention of the parties should be determined after reading the contract wholistically.

I. FACTS

Panasonic India Pvt. Ltd. (hereinafter referred to as " t he Petitioner ") and Shah Aircon (hereinafter referred to as "the Respondent") entered into a Distribution Agreement for the sale of electronic goods. The claim of the Petitioner arose out of alleged unpaid invoices which were raised to the Respondent towards the sold goods.