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As per case facts, a manufacturer contracted a logistics company to transport goods. A dispute arose when the logistics company delivered one consignment without receiving payment or the original bill
...of lading, causing financial loss to the manufacturer. The manufacturer then sought to refer the dispute to arbitration, citing a clause in the bill of lading. However, the logistics company argued that the clause, which used the word 'can', did not mandate arbitration, leaving other dispute resolution mechanisms open. The question arose whether an arbitration clause in the contract using the word 'can' necessitates the reference of all disputes to arbitration, or if other dispute resolution mechanisms, including the Civil Court, remain open to the parties. Finally, the Supreme Court ruled that the word 'can' indicates possibility, not a mandatory obligation for arbitration. It emphasized that a binding arbitration agreement requires a clear intention and obligation to arbitrate, not merely a possibility. The clause's incomplete procedure for appointing arbitrators further supported this. Therefore, a separate agreement between the parties would be necessary to proceed with arbitration. The appeal was dismissed, concluding that the clause did not constitute a binding arbitration agreement.
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