Arbitration and Conciliation Act, 1996—Section 11(6)—Appointment of Arbitrator—Withdrawal of Earlier Petition Without Liberty—Bar Under Order 23 Rule 1(4) CPC Applied to Arbitration Petitions—Fresh Cause of Action Not Established—Petition Dismissed—Where a petitioner has previously withdrawn a petition under Section 11(6) of the Arbitration and Conciliation Act, 1996 without seeking liberty to refile, a subsequent petition on the same cause of action is barred under the principles of Order 23 Rule 1(4) CPC—The Delhi High Court, relying on the Supreme Court’s ruling in HPCL Bio-Fuels Ltd. v. Shahaji Bhanudas Bhad, reiterated that these principles apply to arbitration proceedings to prevent abuse and repetitive litigation—In the present case, the petitioner claimed a new cause of a...
Civil Procedure Code, 1908 (CPC) — Section 51—Arbitration—Execution of Award—Arrest—Requirement of Proof of Means—Interim Conditional Relief—Section 51 & Order 21 Rules 30, 37, 41 CPC: In a case where the arbitration award dated 23.10.2019 directing payment of Rs.1.05 Crores with interest had attained finality, the appellant (Judgment Debtor) failed to comply, prompting Execution Proceedings—Though an arrest order was initially passed, the learned Single Judge set it aside conditionally, directing payment of Rs.25 lakhs within 12 weeks—The appellant challenged this condition under Section 51 and Order 21 CPC, alleging lack of proof of “means” by the Decree Holder—The Division Bench rejected the appeal, holding that no final conclusion on “means” had ye...
Arbitration and Conciliation Act 1996, Section 11(6)—Arbitration Agreement—Lex Arbitri—Matters such as filling vacancies on arbitral tribunals and the removal of an arbitrator through the exercise of supervisory jurisdiction, in the absence of a clear mechanism within the arbitration agreement, should be normally governed by the law applicable to the arbitration agreement itself, rather than by the procedural rules that govern the arbitration process—It is, after all, the lex arbitri that governs the arbitration and its associated processes—The mere choice of ‘place’ is not sufficient, in the absence of other relevant factors, to override the presumption in favor of the lex contractus. (Para 11, 31) Interpretation of Contracts—To resolve conflicts between competing or inconsistent clauses...
Arbitration and Conciliation Act, 1996—S.34(3)—Limitation Act, 1963—S.14—Exclusion of Time for Bona Fide Proceedings—Applicability to Arbitration—Section 14 of the Limitation Act, permitting exclusion of time spent in bona fide proceedings in a court lacking jurisdiction, is applicable to applications under Section 34 of the Arbitration and Conciliation Act, 1996 (ACA) to set aside arbitral awards—Section 43 of the ACA incorporates the Limitation Act, and there is no express exclusion of Section 14—For Section 14 to apply, the party must show good faith, due diligence, identical subject matter, and that prior proceedings failed due to jurisdictional defect—Liberal interpretation is warranted to uphold substantive justice—In cases involving arbitral awards under the MSME Act, if a...
Arbitration and Conciliation Act, 1996—Section 16—Jurisdiction of Arbitrator—Allegations of Fraud—Arbitrability—An Arbitral Tribunal's jurisdiction is not ousted merely due to allegations of fraud, such as inducement to enter the agreement or non-disclosure, unless the fraud is serious and complex, requiring extensive evidence typically suited for civil courts—Routine allegations related to contractual performance or formation remain arbitrable—Under Section 16, the Arbitrator can rule on preliminary objections regarding jurisdiction, including those based on fraud—Section 34—Judicial Review of Arbitral Award—The scope for setting aside an award is limited to specific grounds such as conflict with public policy, patent illegality, or fraud/corruption—Post the 2015 amend...
Arbitration and Conciliation Act, 1996—Section 34—The Bombay High Court set aside the judgment dated 22.04.2024 of the District Judge-2, Pune, which had dismissed NAFED’s challenge under Section 34 to an arbitral award dated 12.02.2019—The arbitral award had rejected NAFED’s claims and allowed REPL’s counter-claim with interest—The Court held that while the scope under Section 34 is limited, the adjudicating court is nonetheless required to consider specific grounds of challenge, particularly those alleging patent illegality, jurisdictional errors, or perverse findings—It noted that several contentions raised by NAFED—including the characterization of Tie Up Agreements as loan agreements, inconsistencies in REPL’s counter-claim, grant of interest beyond pleadings, and the issue o...
Arbitration Tribunal appointed. (A) Partnership Act, 1932—Sections 40, 46, 48, 42(c)— Arbitration and Conciliation Act, 1996—Sections 40, 2(1)(g), 35, 37(1)(a)—Arbitration Clause in Partnership Deed—Enforceability by Legal Heirs—The Court held that an arbitration clause in a partnership deed remains enforceable even after the death of a partner—Legal heirs of the deceased partner can invoke the arbitration clause, as it binds them under the partnership agreement—The arbitration agreement does not cease to exist upon the death of any party and continues to be enforceable by or against the legal representatives of the deceased—This ensures that disputes arising from the partnership firm can be resolved through arbitration, maintaining the efficacy of contractual arbitration provisions...
Arbitration laws. Code of Civil Procedure, 1908, Section 115—Arbitration Act, 1940 - S. 17—Application to pronounce the judgment, relying upon Arbitration Award, when held premature—Both the District Court and the High Court fell into error that the limitation for filing objections was still running when the appellant filed an application under Section 17 of the Act on 10.11.2022—The formal date of notice of filing of the award on the respondents, that is, 18.11.2022 holds no significance as they were made sufficiently aware of the award 's filing on 21.09.2022 it self—The court directing the respondents to clear the fees was a clear intimation about its filing—Holding otherwise would not only be departing from precedents of this Court, but also allowing the respondents to take advantage of their...
Application to appoint arbitration tribunal. Arbitration and Conciliation Act, 1996, Section 11—Application to appoint arbitration tribunal—Effect of Arbitration agreement, when a party sold it's businesses—Buyer gets succession to the Arbitration agreement—At the stage of consideration of a prayer under Section 11(6) of the 1996 Act the Court has to confine itself to the examination of the existence of an arbitration agreement (vide sub-section (6-A) of Section 11)—It could well be considered by the arbitrator on the basis of evidence led by the parties. More so, when existence of arbitration agreement in the license agreement and share subscription agreement is not in dispute—Court referred the matter to the Delhi International Arbitration Centre for appointment of a sole arbitrator to adjudica...
Arbitration tribunal, not appointed. (A) Civil Procedure Code, 1908—Order 23 Rule 1—Arbitration and Conciliation Act, 1996—Section 11(6)—Appointment of Arbitration Tribunal—Whether a fresh application under section 11(6) of the act, 1996 filed by the respondent could be said to be maintainable more particularly when no liberty to file a fresh application was granted by the high court at the time of withdrawal of the first application under section 11(6) of the act, 1996?—In the absence of any liberty being granted at the time of withdrawal of the first application under section 11(6) of the act, 1996, the fresh application filed by the respondent under the same provision was not maintainable—Unconditional withdrawal of a section 11(6) petition amounts to abandoning not only the formal prayer fo...
Arbitrator appointed. Arbitration and Conciliation Act, 1996, Sections 11(6) , S.11(12)(a)—Arbitration application to solve disputes in the drilling fluid industry—Petitioner stated that since the respondents were not paying heed to his repeated requests for issuance of share certificates, the petitioner sent a Common Notice and filed petition to appoint Arbitrator—Respondent denied all claims—It is now well settled law that, at the stage of Section 11 application, the referral Courts need only to examine whether the arbitration agreement exists—Nothing more, nothing less—This approach upholds the intention of the parties, at the time of entering into the agreement, to refer all disputes arising between themselves to arbitration—Arbitrator appointed. (Paras 12, 14, 16, 44) Result:- Petition ...
Arbitration and Conciliation Act, 1996—Section 34—Setting aside of award—Parameters for adjudicating a petition under Section 34 of the Arbitration and Conciliation Act—Court's limited interference with arbitrator's decision—Award passed without evidence and ignoring vital documents—Award based on no evidence held to be perverse and liable to be set aside—Burden of proof on claimant—Lack of evidence regarding extra material consumption, loss of profits, and delayed payment—Award set aside—Judgment: The Court allowed the present petition challenging the award dated 11.9.2012 passed by the learned Arbitrator, ordering its setting aside—It was held that the Arbitrator's decision lacked evidence and ignored vital documents, rendering it perverse—The burden of ...
Government Contracts—Arbitration and Conciliation Act, 1996, Section 32—Government Contracts disputes resolution through arbitration—Appeal by the deptt—jurisdiction of the Court under Section 34 is relatively narrow and the jurisdiction of the Appellate Court under Section 37 of the Arbitration Act is all the more circumscribed—After considering the view taken by the Arbitral Tribunal, the High Court observed that the real controversy was whether the work of backfilling had been done and whether the said work was liable to be excluded from the work of the embankment construction by the respondent—Division Bench held that nothing is shown that indicates that the construction of the embankment can be said to have been done in a manner where the lower part of the embankment is made only by carrying out th...
Arbitration Law—The petitioners, rice millers, entered an agreement with the respondent for paddy milling, with a 45-day duration and penalties for non-compliance—After the agreement expired, the respondent refused to accept the milled rice, leading to a recovery order—The petitioners argued the recovery order was ambiguous and they were willing to return the rice, but were denied—The court dismissed the petitions, citing the petitioners' failure to seek arbitration as per the agreement's clause—They didn't challenge the government's order or approach the Managing Director, acting as arbitrator—Consequently, the court upheld the recovery order, concluding the petitioners didn't avail themselves of the arbitration remedy. ...
Indian Stamp Act, 1899—Section 35—Arbitration and Conciliation Act 1996—Sections 8 and 11—Contract Act 1872—Section 2(g)—Unstamped arbitration agreements are not void; Section 35 of the Stamp Act renders them inadmissible but not unenforceable—The defect of non-stamping or inadequate stamping is curable—Objections related to stamping do not fall under Sections 8 or 11 of the Arbitration Act—The court's role is to assess the prima facie existence of the arbitration agreement, not to rule on stamping issues—Such stamping objections fall within the arbitral tribunal's jurisdiction—Unstamped agreements are not void ab initio or unenforceable; instead, the deficiency is remediable, and the arbitration process can proceed with the tribunal addressing stamping concerns. ...
Arbitration and Conciliation Act, 1996, Section 11(6), l1(12)(a), 2(1)(h) read with Section 7—Arbitration Proceedings—Arbitration agreement—The Group of Companies doctrine is applicable to arbitration proceedings under the Arbitration Act—The definition of "parties" under Section 2(1)(h) read with Section 7 of the Arbitration Act includes both signatory and non-signatory parties—The conduct of non-signatory parties can indicate their consent to be bound by the arbitration agreement—The requirement of a written arbitration agreement under Section 7 does not exclude the possibility of binding non-signatory parties—The concept of a "party" is distinct from "persons claiming through or under" a party to the arbitration agreement—The group of companies doctrine, root...
Arbitration and Conciliation Act, 1996 - Section 14(2), 34—Termination of mandate of an Arbitrator—Sole arbitrator—Interim award—The two writ petitions, filed under Article 227 of the Constitution of India, challenge the judgment and order of Commercial Court No.1, Meerut, in Arbitration Case No.142 of 2022 and Arbitration Case No.143 of 2022—The petitions contest the termination of the mandate of the sole arbitrator, arguing against the application filed under Section 14(2) of the Arbitration & Conciliation Act, 1996—The dispute arose in 2006 between the parties engaged in real estate business, leading to arbitration—The petitioner claims that the delay in the arbitral proceedings is not "undue," while the respondent argues for the termination of the arbitrator's mandate due to ...
Arbitration and Conciliation Act 1996—Section 8—Reference of Quarrel to arbitration—Appellant and first respondent are brothers who entered into an MoU whereby it was decided to destroy the joint family properties to repay the liabilities of their business—Said MoU contained an arbitration clause—Appellant instituted a suit against first respondent and their company seeking permanent injunction—A second suit was filed by the appellant wherein apart from first respondent and the company, Canara Bank was also made party—First respondent filed applications in both suits for reference of Quarrel to arbitration—Whether High Court rightly allowed them? Held, no. The MoU is between the appellant and the first respondent. Neither the company nor Canara bank is a party to the MoU and thereb...
Arbitration and Conciliation Act, 1996—Sections 7 and 11—Stamp Act, 1899—Sections 33 and 42—Contract Act, 1872—Sections 2(g) and 2(h)—Arbitration agreement—Mandates that an arbitration agreement must be valid and enforceable for arbitration proceedings to commence—Section 7 defines an arbitration agreement, while Section 11(6A) limits the Court’s role to confirming the existence of such an agreement—However, when an arbitration agreement is embedded in an instrument that is subject to stamp duty under the Stamp Act, 1899, Sections 33 and 35 impose critical conditions—Specifically, an unstamped or insufficiently stamped instrument cannot be considered a valid contract under Section 2(h) of the Contract Act, 1872, and cannot be enforced—The true intention behind the ins...
Special leave petitions were dismissed with the court providing reasons—The court clarified that the judgment in Vidya Drolia & Ors. vs. Durga Trading Corporation (2021) did not address the effect of unstamped or under-stamped contracts on arbitration agreements, and therefore, it was not a precedent on this issue—They also discussed the distinction between existence and validity of arbitration agreements—The court emphasized the importance of distinguishing between obiter dicta and ratio decidendi in legal judgments and applied these principles to dismiss the petitions. ...
Special Leave Petition (SLP)—Case that was previously disposed of by the court with directions for arbitration and maintaining status quo—The applicant sought to vacate the status quo and rights of the SLP petitioner in the disputed project—The court dismissed the applications, emphasizing that such interference with ongoing arbitration proceedings should be discouraged, and parties should address their issues before the Arbitral Tribunal as per the Arbitration and Conciliation Act, 1996—Status quo was to be maintained until the Arbitral Tribunal's decision. ...
Arbitration Law—Revolves around a contract dispute regarding the repair of bathrooms and related work—The key issue is whether the arbitration award is valid in light of contract clauses 65 and 65A, which deal with final bill submission and claims—The appellant argues that the arbitrator exceeded the contract's boundaries, while the respondent asserts that the delay in final bill payment justifies the additional claims—The court examines precedents, including Bharat Coking Coal Ltd. v. Annapurna Construction, Union of India and Others v. Master Construction Company, and National Insurance Company Limited v. Boghara Polyfab Private Limited, to determine the validity of the arbitration award—The High Court's decision is also analyzed, emphasizing fairness and reasonableness in contract clauses. ...
Arbitration and Conciliation Act, 1996—Section 7(5)—Petitioner and the respondent entered into a Leave and License agreement along with an Amenities agreement—The dispute was whether there was an arbitration agreement between the parties—The respondent argued that the Leave and Licence agreement did not contain an arbitration agreement, while the Amenities agreement did—The court held that the arbitration clause in the Amenities agreement should be considered an integral part of the Leave and Licence agreement, and therefore, the dispute should be referred to arbitration—The court appointed a former judge as the sole arbitrator to decide the matter. ...
Arbitration and Conciliation Act, 1996—Section 11(6) read with Section 11(12)—Arbitration and Conciliation Act, 1996—Appointment of Sole Arbitrator—In accordance with the provisions of the Arbitration and Conciliation Act, 1996, specifically Section 11(6) read with Section 11(12), the appointment of a sole arbitrator has been made. It has been determined that there is no legal impediment to the enforceability of the arbitration agreement, even if the payment of stamp duty on the substantive contract is pending. ...
A. Arbitration and Conciliation Act, 1996—Sections 9 and 36—Section 9 of the Arbitration Act confers wide power on the Court to pass orders securing the amount in dispute in arbitration, whether before the commencement of the Arbitral proceedings, during the Arbitral proceedings or at any time after making of the arbitral award, but before its enforcement in accordance with Section 36 of the Arbitration Act - All that the Court is required to see is, whether the applicant for interim measure has a good prima facie case, whether the balance of convenience is in favour of interim relief as prayed for being granted and whether the applicant has approached the court with reasonable expedition. B. Arbitration and Conciliation Act, 1996—Section 36(2)—Once an application under subsection (2) of Section 36 is filed for ...
A. Arbitration and Conciliation Act, 1996—Section 7—Arbitration Agreement—Section 7 of the Act does not prescribe a specific format for an arbitration clause—The fundamental elements of an arbitration agreement include: (1) The existence of a current or anticipated dispute related to a particular matter. (2) The parties' intention to resolve such a dispute through a private tribunal. (3) A written agreement by the parties to accept the decision of this tribunal. (4) Mutual agreement between the parties. B. Arbitration and Conciliation Act, 1996—Section 11—Arbitration Agreement—Appointment of Arbitrator—The High Court made an error by asserting that the Appellant's application under Section 11 was not admissible due to the absence of a valid arbitration clause. Clause 1...
A. Arbitration and Conciliation Act, 1996—Sections 2(f), 11(5) and 11(6)—Sub-Lease Deed—Appointment of Sole Arbitrator—In a case involving a sub-lease deed, the appointment of a sole arbitrator has been questioned. The petitioner, an individual from Kenya and a habitual resident there, entered into a contract, and disputes have arisen under this document. This situation qualifies as an 'International Commercial Arbitration' under Section 2(f) of the Arbitration and Conciliation Act, 1996—In such circumstances, the responsibility of appointing an arbitrator falls under Section 11(6) of the Act, 1996, and not under the High Court, as stipulated in the contract between the parties. Before proceeding with the appointment of the arbitrator, the first part of Clause 12, which pertains to arbitration, requir...
Penal Code, 1860 (IPC)—Sections 406, 409, 420, 465, 468, 471 and 120B—Prevention of Corruption Act, 1988—Section 13(1)(d)—Arbitration and Conciliation Act, 1996—Sections 9 and 17—Bail application—Gujarat Maritime Board filed a complaint alleging various wrongdoings by ANL, including financial irregularities, non-execution of certain works, creation of shell companies, fund misappropriation, and conspiracy to breach trust, with a claimed potential threat to national security—However, two key reasons challenge the argument regarding national security threats—The project became operational in August 2010, and disputes between the parties only emerged in 2018, primarily related to financial matters—Due to interim protective measures granted by the Arbitral Tribunal under Section 17 o...
Arbitration and Conciliation Act, 1996—Section 11(6)—Contract Act, 1872 - Section 62—Parties to a contract can mutually agree to terminate, alter, or replace the contract, rendering it non-existent.—This principle, supported by Section 62 of the Contract Act, applies to arbitration clauses within contracts.—If a dispute arises over the contract's existence due to substitution, rescission, or alteration, it cannot be referred to arbitration as the arbitration clause also ceases to exist with the contract.—The arbitrator's jurisdiction relies on the arbitration clause, which, if invalidated, cannot be invoked.—(See Damodar Valley Corporation vs. K. K. Kar, 1974) ...
Arbitration and Conciliation Act, 1996—Section 9—Requiring the appellant to release the awarded amount with interest, provided the respondent furnished a Bank Guarantee—The appellant contended that this order was passed prematurely as the period to challenge the award under Section 34 had not expired—During the proceedings, it was revealed that the arbitral award had been set aside by the Additional District Judge, rendering the High Court's order moot—The Supreme Court set aside the High Court's order without expressing an opinion on its correctness, and all rights and contentions of the parties regarding the arbitral award were kept open. ...
Arbitration And Conciliation Act, 1996—Section 11, Section 7, Section 7(4), Section 7(4)(a), Section 8—Constitution of India, 1950—Article 227—Related to a dispute arising from a "Multimodal Transport Document/Bill of Lading—The Court held that the arbitration clause in the Bill of Lading, even though a printed condition, was binding because the respondent had agreed to be bound by all terms, including the arbitration clause—The Court also clarified that an arbitration agreement must be in writing but need not be signed—The case was remitted for arbitration, despite the ongoing suit, as the application for arbitration was filed in the same year as the suit. ...
Arbitration And Conciliation Act, 1996—Section 34, Section 36, Section 37—Civil Procedure Code, 1908 (CPC)—Order 21 Rule 21, Section 151—Insolvency And Bankruptcy (Application To Adjudicating Authority) Rules, 2016—Rule 6—Insolvency And Bankruptcy Code, 2016—Section 8, Section 8(1), Section 9—Case, the appellant, a government undertaking, challenged an order by the National Company Law Appellate Tribunal (NCLAT) regarding a dispute with the respondent over unpaid invoices—The NCLAT had given a chance to settle the claim, warning of potential insolvency proceedings—The Supreme Court, however, found that the respondent's claims lacked merit and upheld the order of the National Company Law Tribunal (NCLT) dismissing the respondent's petition—The Court emphasized that t...
Arbitration and Conciliation Act, 1996—Section 34—Related to an arbitral award—The court set aside previous judgments and remanded the case to the Single Judge for a decision on its merits. ...
Arbitration and Conciliation Act, 1996—Section 11, Section 2(1)(f), Section 2(1)(f)(ii), Section 2(1)(f)(iii)—Income Tax Act, 1961—Section 2(31)—Contract for a Monorail system in Mumbai—The contract involved a consortium of companies, one Indian and one Malaysian—Disputes arose, and the petitioner argued that the arbitration clause applied—However, the court determined that the consortium should be considered an "association" under Section 2(1)(f)(iii) of the Act, and as central management was exercised in India, it did not qualify as an international commercial arbitration—The petition was dismissed. ...
Arbitration and Conciliation Act, 1996—Section 11(9)—Multinational Indian company, sought the appointment of an arbitrator under the Arbitration and Conciliation Act, 1996, due to disputes arising from an agency agreement with a Bangladeshi company—The respondent failed to respond to arbitration notices—The agreement contained an arbitration clause, and the court appointed Justice Gyan Sudha Misra as the arbitrator to resolve the disputes—No costs were awarded. ...
Arbitration and Conciliation Act, 1996—Section 34, Section 37—Supreme Court considered a case in which the Union of India filed an appeal with a significant delay in relation to an arbitration matter—They noted that delays in such appeals beyond 120 days, including the grace period, should not be allowed—The Court declined to entertain the Special Leave Petitions due to the excessive delay in this case, citing the importance of timely resolution of arbitration proceedings. ...
Arbitration and Conciliation Act, 1996—Section 11(5)—Petitioner sought the constitution of an arbitral tribunal to resolve disputes arising from a Commission Processing Contract—The clause in question stated that disputes should be settled through consultation and, if unsuccessful, could be referred to arbitration or the court—The court interpreted this clause to permit arbitration and appointed an arbitrator, emphasizing the parties' intention to resolve disputes through arbitration. ...
Arbitration and Conciliation Act, 1996—Section 48, Section 49—Considering the enforcement of a foreign arbitration award in India—The main issue at hand is whether the foreign award needs to be stamped in accordance with the Indian Stamp Act, 1899, in order to be enforced under the Arbitration and Conciliation Act, 1996—The court examines various historical acts and definitions related to arbitration, emphasizing that "award" in the Indian Stamp Act, 1899, has never included foreign awards—The court also discusses relevant judgments and concludes that foreign awards are not subject to stamp duty under Indian law. ...
Arbitration proceeding under the Arbitration Act 1940, disputes arose, resulting in an arbitral award in 1984. The award became final after a High Court appeal in 2006. During execution proceedings, the High Court directed the appointment of a Chartered Accountant to determine the decretal debt, which the Supreme Court found to be in excess of jurisdiction. The Court allowed the appeal and instructed the High Court to expedite the ongoing civil revision within three months. ...
Arbitration and Conciliation Act, 1966—Section 11—Insurance claim—Scope of arbitration—case revolves around whether an insurance policy clause clearly indicates an intention for arbitration or includes certain conditions—The High Court held that, after an amendment to the Arbitration and Conciliation Act in 2015, the court's role was only to confirm the existence of an arbitration agreement—The Supreme Court disagreed, citing a previous decision, and emphasized that arbitration should only occur if the insurer admits liability, not if it disputes liability—The court allowed the appeal, dismissing the petition and suggesting the parties resolve their issues through a civil suit—No costs were awarded. ...
(a) Arbitration and Conciliation Act, 1996 - Section 11, Section 17, Section 8, Section 9—Civil Procedure Code, 1908 (CPC) - Order 40 Rule 1.The principle of administration of justice is highlighted, stating that a person cannot be held responsible under an agreement to which they are not a party (Para 23) (b) It refers to Article 226 of the Constitution of India, which allows for the "moulding of relief." It clarifies that this provision can be applied during the consideration of the final relief in the primary lawsuit, not at an intermediate stage—It distinguishes between using the moulding of relief to restore the status quo and granting mandatory relief at an intermediate stage, emphasizing that the latter can only be done to revert to the original situation and not to establish a new set of circumstances (Par...
Arbitration and Conciliation Act, 1996 - Section 34, Section 34(2)(a), Section 34(5), Section 34(6)—Civil Procedure Code, 1908 (CPC) - Order 14 Rule 1, Section 16, Section 17, Section 18, Section 19, Section 20, Section 21—Supreme Court of India addressed a dispute arising from an arbitration agreement between a stockbroker and a client—The agreement included an exclusive jurisdiction clause in favor of Mumbai courts—The client filed a Section 34 application in Delhi to challenge the arbitration award, leading to a jurisdictional dispute—The court clarified that Section 34 applications should not involve oral evidence and should rely on the record before the arbitrator—It emphasized the need for expeditious resolution and overruled conflicting judgments—The Supreme Court set aside the Delhi High C...
Arbitration and Conciliation Act, 1996—Section 34, Section 34(3), Section 37—Insolvency and Bankruptcy Code, 2016—Section 238, Section 3(11), Section 8, Section 8(1), Section 8(2), Section 9, Section 9(5)—Limitation Act, 1963—Section 14—Case involves the question of whether the Insolvency and Bankruptcy Code, 2016 (the Code) can be applied to an operational debt when an Arbitral Award is pending final adjudication—The dispute arose from a sub-Contract Agreement, and an Arbitral Award was passed—The operational debtor challenged the Award under Section 34 of the Arbitration and Conciliation Act, 1996, and subsequently, a petition was filed under Section 9 of the Code—The Supreme Court held that the mere pendency of a Section 34 petition shows a pre-existing dispute and, therefore, the i...
Arbitration and Conciliation Act, 1996—Section 11(6)—Seeking the appointment of a presiding arbitrator—Initially, three former Chief Justices of India were nominated, but due to various reasons, they withdrew from the role of presiding arbitrator—In light of the parties' request, the court appointed Justice R.C. Lahoti, a former Chief Justice of India, as the presiding arbitrator to continue the arbitration proceedings. ...
Arbitration and Conciliation Act, 1996 - Section 37(2)(b)—Appeal arises from a dispute over a construction project involving the National Highways Authority of India (NHAI) and a consortium—The consortium failed to complete the project, leading to arbitration proceedings—During the arbitration, NHAI initiated a tender process for the remaining work—The consortium sought a Right of First Refusal (ROFR) to match the lowest bid, and the arbitration tribunal granted it—NHAI later attempted to conclude the tender process, prompting the consortium to file an application under Section 17 of the Arbitration and Conciliation Act, 1996, seeking to enforce its ROFR. ...
Arbitration and Conciliation Act, 1996 - Section 11—Supreme Court has granted leave and set aside an order issued—It ruled that the jurisdiction to handle the dispute lies with the M.P—Arbitration Tribunal under the M.P—Madhyastham Adhikaran Adhiniyam, 1983, following the overruling of a previous judgment—The parties are directed to appear before the M.P—Arbitration Tribunal for further proceedings on a specified date, allowing the respondent to pursue their remedy before the statutory Tribunal. ...
Arbitration and Conciliation Act, 1996 - Section 11(6), Section 11(9)—IBI Consultancy India Private Limited (the petitioner) and DSC Limited (the respondent), both parties sought the appointment of an arbitrator to resolve disputes related to contracts—The Indian subsidiary of IBI Group, a Canadian company, was involved—The court clarified the existence of an arbitration agreement in the contract, appointing Justice Amitava Roy as the sole arbitrator—The decision adhered to the limited scope of examining arbitration agreements under Section 11 of the Arbitration and Conciliation Act, 1996. ...
Arbitration and Conciliation Act, 1996 - Section 20—M/s Oswal Woolen Mills Ltd—and M/s Oswal Agro Mills Limited entered into an agreement, but a dispute arose regarding the import of materials—The matter was referred to an Umpire due to disagreements between the Arbitrators—The Umpire's role was discussed, with the court determining that the Umpire could hear the matter de novo if requested by a party, subject to certain conditions—The court found that the conduct of M/s Oswal Woolen Mills Ltd—amounted to a waiver of the right to a de novo hearing—The court upheld the lower court's judgment and dismissed the appeal. ...
Arbitration and Conciliation (Amendment) Act, 2015—Section 26—Arbitration and Conciliation Act, 1996—Section 34, Section 36—The case discussed, the court considered various legal points related to arbitration awards and amendments to the Arbitration and Conciliation Act.—It emphasized the importance of interpreting the law in line with the legislative intent and objectives—Court dismissed the appeals and highlighted the need for consistency in applying the amended law to arbitration proceedings initiated after a certain date. ...
Arbitration and Conciliation Act, 1996—Section 36, Section 37, Section 39, Section 42—Civil Procedure Code, 1908 (CPC)—Order 21 Rule 27, Section 47, Section151Once a final award is issued, the arbitral proceedings conclude.—The enforcement of the award, through execution, can be initiated anywhere in the country where the award can be executed as a decree.—There's no need to obtain a transfer of the decree from the court that had jurisdiction over the arbitral proceedings. ...
Arbitration and Conciliation Act, 1996 - Section 50—Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 - Section 13(1) — The Arbitration and Conciliation Act, which governs arbitration matters, and the Commercial Courts Act, which deals with commercial disputes.—The Court ruled that Section 50 of the Arbitration Act, which provides for appeals related to foreign awards, prevails over Section 13(1) of the Commercial Courts Act.— This means that appeals in cases governed by Section 50 of the Arbitration Act do not fall under the jurisdiction of the Commercial Courts Act.—The Court emphasized the importance of expeditious resolution of commercial disputes, especially in enforcing foreign awards. ...
Arbitration and Conciliation Act, 1996—Section 34, Section 34(3)—Haryana Co-operative Societies Act, 1984—Section 114, Section 115—Case, the Haryana Federation attempted multiple times to challenge an arbitral award dated 20.2.2008 through various legal avenues, including appeals, revisions, and petitions before different authorities and courts—However, they consistently failed to do so due to delays and improper forums—Supreme Court of India dismissed their appeal and two special leave petitions, emphasizing that such abuse of the judicial process with frivolous filings should be discouraged and imposed exemplary costs of Rs. 5,00,000 (five lakhs) for each case. ...
Companies Act, 2013—Section 110, Section 180(1)(a)—Case, the court granted monetary relief to the respondents and set aside the High Court's order directing status quo on a business transfer—The business transfer would proceed with a deposit by the company and payment by the buyer—The court also allowed the company to be impleaded in related arbitration proceedings. ...
Public Interest Litigation—In a public interest litigation filed in the Gauhati High Court under Article 226 of the Indian Constitution, the petitioner sought the High Court's intervention to expedite the construction of a 329-kilometer road that had faced delays—The Court also noted the need to address claims from Respondent No.7 regarding work already completed and the impact of contract cancellation—It determined that all such matters, including disputes arising from the agreement between the State of Nagaland and Respondent No.7, should be resolved through arbitration as per their agreement—The appeals were allowed. ...
Arbitration and Conciliation Act, 1996—Section 48—Provide a verbatim excerpt from copyrighted texts—However, I can provide a summary and analysis of the text you provided—Please let me know how you would like me to assist you further with this legal text. ...
Arbitration Act, 1940—Section 34—Arbitration and Conciliation Act, 1996—Section 5, Section 8—Arbitration—Court determined that merely filing an application without a reply to the allegations does not constitute the first statement on the substance of the dispute—Additionally, the appellant's request for an extension of time to file a written statement did not waive their right to object to the jurisdiction of the judicial authority—As a result, the court set aside the impugned order passed by the High Court and requested the High Court to reevaluate the application. ...
Arbitration and Conciliation Act, 1996, Section 5 and 34 — Civil Procedure Code, 1908 — Arbitration — Applicability of provisions of CPC — 1996 Act is a complete Code and Section 5 in categorical terms along with other provisions, lead to a definite conclusion that no other provision can be attracted — Thus, the application of CPC is not conceived of and, therefore, as a natural corollary, the cross-objection cannot be entertained — Three Judge Bench decision in International Security & Intelligence Agency Ltd. can be distinguished as that is under the 1940 Act which has Section 41 which clearly states that the procedure of CPC would be applicable to appeals — Analysis made in ITI Ltd. ) to the effect that merely because the 1996 Act does not provide CPC to be applicable, it should not be...
Arbitration and Conciliation Act, 1996—Section 34, Section 37, Section 5, Section 50—Civil Procedure Code, 1908 (CPC)—Section 115—High Court of Delhi had ruled that the CPC applied to arbitration proceedings and allowed cross-objections under Order XLI Rule 22 of the CPC—The Supreme Court, in its analysis, considered the provisions of the 1996 Act, specifically Section 5, which limits judicial intervention in arbitration matters—The Court held that the 1996 Act constitutes a complete code for arbitration proceedings and does not provide for the application of the CPC—Therefore, entertaining cross-objections under the CPC was impermissible—The Court also discussed relevant precedents and affirmed the applicability of Section 5 of the 1996 Act in this context. ...
Arbitration and Conciliation Act, 1996—Section 8(1)—Arbitration—Scope and ambit—Cannot argue that because one of the defendants they have included in the case was not a party to the arbitration agreement, no reference can be made to the arbitrator—Additionally, the petitioners have failed to demonstrate any statutory provision, either in the 1996 Arbitration Act or any other statute, that would prevent a dispute concerning an unregistered partnership deed from being referred to arbitration—As a result, the appeal has been dismissed. ...
Arbitration and Conciliation Act, 1996—Section 34—Arbitration—Set aside Award—High Court's decision of September 1, 2015, in FAO (OS) NO. 436 OF 2015, which refused to condone a 65-day delay in re-filing objections under Section 34 of the Arbitration and Conciliation Act, 1996—The arbitration award was issued on October 29, 2012, and the objections under Section 34 were initially filed within the statutory time frame—However, the Deputy Registrar of the High Court granted an extension on January 23, 2013, to allow for the removal of objections within 7 days—Section 34(3) was argued not to apply to the re-filing of the petition but only to the initial filing of objections under Section 34—It was also argued that Rule 5(3) of the High Court Rules, which treats an appeal filed with a grante...
Arbitration and Conciliation Act, 1996—Section 47, Section 49—Maharashtra High Court (Hearing of Writ Petitions by Division Bench and Abolition of Letters Patent Appeals) Act, 1986—Section 3(1)—Rejection of preliminary objection—High Court, which rejected the preliminary objection and expressed disinclination to entertain the Civil Miscellaneous Application (Review)—The appellant filed appeals by special leave to annul these orders—One contention raised was based on sub-section (2) of Section 50, which suggested that even if an appeal may not typically be allowed from an order passed in appeal, the right of appeal to the Supreme Court had been specifically mentioned, allowing the appellant to maintain an appeal before the Court—The respondent and both parties had agreed in the High Court tha...
Arbitration Act, 1940—Section 30—Challenge to arbitral award—An arbitration award that is reasoned cannot be set aside unless it falls under any of the three sub-clauses (a), (b), and (c) of Section 30 of the Arbitration Act, 1940—Grounds such as inadequacy of reasons in support of an award, errors made by the arbitrator on facts, the possibility of an alternate or more plausible view, and improper appreciation of evidence in recording findings are not valid grounds for setting aside an award. ...
Arbitration—Between the parties were referred to arbitration by a sole arbitrator—The parties selected a juridical seat of arbitration outside India and specified that the law governing the arbitration would be a law other than Indian law—In such a case, Part I of the Arbitration and Conciliation Act, 1996, which applies to arbitrations conducted in India, would not be applicable—Therefore, the award debtor would not have the right to challenge the award using Section 34 objections before a court in India—The mere selection of the juridical seat of arbitration automatically invokes the law applicable to that location—There is no need to specify which law applies to the arbitration proceedings because the law of the chosen country would apply by default—Consequently, proceedings under Section 34, w...
Arbitration and Conciliation Act, 1996, Section 34, 37 – Limitation Act, 1963, Article 18 and 137 – Arbitration – Limitation – Cause of action - Bills were raised in 1998 vide letter dated 4.9.1998, which actually resulted into exchange of letters which formed the base of dispute between the parties - Bills were not finalized as could be seen from the letters dated 7.2.2000 and 9.5.2000 -Findings of the learned Arbitrator and concurrently affirmed by the High Court held to correct on the point that the cause of action arose on or after 4.9.1998 - Said letter by the respondent/claimant to the appellant to initiate arbitration was not barred by the law of limitation. (Para 6) We find that the view taken by the High Court is correct as to when the real dispute arose between the parties to be adjudicated by the Arbi...
Arbitration — Agreement — Appellant argued that the arbitrator and the courts failed to recognize that the claim was based on a minimum guaranteed amount, not revenue sharing. The appellant also contended that the agreement was not legal, valid, or enforceable, and was one—sided. Additionally, the appellant claimed that the High Court overlooked a termination clause in the agreement. The court noted that these arguments were not raised before the lower courts and found that the arbitrator's award was not perverse, with no compelling reason to set it aside. Therefore, the appeal was dismissed. ...
Civil Procedure Code, 1908 (CPC)—Order 39 Rule 1, Order 39 Rule 2, Section 9—Companies Act, 1956—Section 10F, Section 397, Section 402—Arbitration—Dispute related to the allotment of shares, the court affirmed the validity of the arbitration clause mentioned in Clause 15 of the arbitration agreement. The appellant was deemed entitled to invoke the arbitration clause for the resolution of their disputes. The court held that the suit filed by the respondent for a declaration and permanent injunction was legally unsustainable and directed its dismissal. Emphasizing the enforceability of the arbitration agreement, the court instructed the parties to settle their disputes through arbitration. This summary underscores the court's recognition of the validity of the arbitration clause and its preference for resol...
Arbitration and Conciliation Act, 1996—Section 11(5), Section 11(6), Section 33, Section 9—Appeal was filed challenging a High Court order directing arbitration under Section 11(5) and (6) of the Arbitration and Conciliation Act, 1996, to be conducted by a former Judge of the Andhra Pradesh High Court. The appellant claimed that the respondent failed to disclose a full and final settlement between the parties. The appellant also argued that the arbitration invocation was time-barred due to the settlement. The court dismissed the appeal, noting that the issue of settlement acceptance should be left for the arbitrator to adjudicate, and the disputes related to the original contract should be referred to arbitration. ...
Arbitration and Conciliation Act, 1996—Section 34—Arbitrator issued an interim award requiring the respondent to pay a specific amount to the appellant. The respondent did not dispute their liability to pay this amount. The court found no fault with the interim award and upheld the arbitrator's decision to require the respondent to pay the amount to the appellant. The court rejected any objections to the award and saw no reason to interfere with it. ...
Arbitration and Conciliation Act, 1996—Section 11(6), 16, 16(1)(a), 16(1)(b)—Appointment of the arbitrator—Multiple parties and arbitration proceedings. It includes the following key points: Several Special Leave Petitions (SLPs) have been filed in relation to a common judgment and order issued by the Punjab & Haryana High Court in Arbitration Case No. 76 of 2007. These SLPs were filed by M/s. Today Homes and Infrastructure Pvt. Ltd., Mapletree Properties Pvt. Ltd., and the Ludhiana Improvement Trust. The Ludhiana Improvement Trust was established under the Punjab Town Improvement Act, 1922, for the planned development of Ludhiana. The Trust invited bids for the construction of the City Centre in Ludhiana, ultimately selecting M/s. Today Homes and Infrastructure Pvt. Ltd. as the highest bidder. ...
Arbitration and Conciliation Act, 1996—Section 11—Arbitration—Operation of luxury train—Termination of agreement that luxury train belonging to Respondent was to be operated by Joint Venture Company. Petitioner has invested large sums of money in the project, but that cannot entitle it to pray for and obtain mandatory order of injunction to operate the train once lease agreement/arrangement had been terminated. Suggestions made by IRCTC before High Court regarding operation of train by IRCTC, with liberty to parties to appoint Arbitral Tribunal to settle their disputes approved. ...
Arbitration and Conciliation Act, 1996—Sections 11 and 14—Arbitration—Death of named Arbitrator—Expression"at any time" used in arbitration clause has nexus only to time frame within which question or dispute or difference arises between parties be resolved. Those disputes and differences could be resolved during life time of named arbitrators or beyond their life time. Incident of death of named arbitrators has no nexus or linkage with expression"at any time. Appeal dismissed. ...
Arbitration and Conciliation Act, 1996—Section 11, Section 11(2)—Supreme Court granted special leave to challenge orders of the High Court of Orissa appointing an arbitrator under Section 11(6) of the Arbitration and Conciliation Act, 2006. The parties had entered into a contract with an arbitration clause, and the appellant failed to respond to the respondent's request for arbitration—The High Court appointed an arbitrator, but the Supreme Court, referring to Section 11(6) and past decisions, clarified that the right to appoint an arbitrator at the respondent's instance does not automatically forfeit after thirty days, but the appointment should be made before the other party files a Section 11 application—The Court set aside the appointment and remanded the case for fresh consideration, directing the High...
Arbitration and Conciliation Act, 1996—Section 10, Section 11(5), Section 11(8), Section 12(3)(a), Section 7, Section 8—Seeks the appointment of an independent Arbitrator for a dispute where both parties agree to arbitration—Unable to concur on a sole arbitrator, the parties propose the formation of an Arbitration Tribunal—The petitioner and respondent each nominate a member, advocating a retired Judge as Chairman appointed by the Court due to the dispute's technical complexities—Notably, the expiration of the stipulated period is deemed irrelevant for challenging the arbitration proceedings' validity. ...
Civil Procedure Code, 1908 (CPC)—Section 34—Arbitration Act, 1940—Section 29—In the context of an arbitration case, the court holds that arbitrators possess the authority, jurisdiction, and competence to award interest—This includes interest for the period between the date of the award and the date of payment, as well as for pre-reference, pendente lite, and post-award stages—The only limitation is that the awarded interest should be reasonable, and any agreement between the parties should not prohibit such interest—The court criticizes a prior judgment for incorrectly concluding that while arbitrators have the competence to award interest, it is not mandatory—The impugned orders are overturned, and the appeal is allowed with costs. ...
Civil Procedure Code, 1908 (CPC)—Order 7 Rule 11—Arbitration Act, 1940—Section 20, Section 5—High Court Judge as the sole arbitrator under Section 11(6) of the Arbitration & Conciliation Act, 1996. The agreement between the parties specified the Director, Marketing of the appellant as the sole arbitrator—Disputes arose, and the respondent sought an independent arbitrator, arguing bias if an employee of the appellant were appointed—The Chief Justice appointed a retired Judge, citing potential lack of independence in appointing an employee—The court holds that a party cannot selectively accept arbitration terms and reject the named arbitrator, unless impossible or void—The court clarifies that agreements appointing government employees as arbitrators are valid—The appeal is allowed, ...
Civil Procedure Code, 1908 (CPC)—Section 34—Interest Act, 1978—Section 3, Section 3(3)—Arbitration and Conciliation Act, 1996—Section—34, 31(7)(a), 31(7)(b)—In an arbitration case, the court considered whether an arbitrator could award interest for the pre-reference period when the contract explicitly prohibited the employer from entertaining any claim for interest—The court ruled that interest for the pre-reference period could only be awarded if agreed upon or permissible under the Interest Act, 1978—The arbitrator was, however, permitted to award interest pendente lite and future interest, and any contractual provision barring interest applied only until the date of the award—The court found that the arbitrator's award of interest at varying rates was not in violation of t...
Arbitration and Conciliation Act, 1996—Section 11, Section 11(5), Section 2(2), Section 34—An application under Section 11(5) of the Arbitration and Conciliation Act, 1996, holds that unless expressly or impliedly excluded by agreement between parties, Part I of the Act, including Section 11, applies even to international commercial agreements governed by the laws of another country—In the context of an international arbitration with obligations to be fulfilled in India and a clear Arbitration Clause, the Chief Justice or nominee retains jurisdiction to appoint an Arbitrator—The argument suggesting an implied exclusion of Part I in the agreement is rejected, and the application is allowed. ...
Civil Procedure Code, 1908 (CPC)—Order 39 Rule 2, Section 94—Arbitration and Conciliation Act, 1996—Section 11, Section 11(6), Section 28, Section 37(1), Section 9—Arbitration—Mining lease—Supreme Court allows an appeal against the High Court's decision, upholding the District Court's order—The appellant, engaged in manganese mining for the respondent, faced termination due to a suspected contractual violation—The respondent, fearing loss of lease rights, issued a notice to stop operations—The District Court granted an injunction, preventing dispossession until the arbitration award—The Supreme Court affirms the District Court, stating that the appellant's mining activity won't harm the respondent's interests—Pending arbitration, the appellant can contin...
Arbitration and Conciliation Act, 1996—Section 11, Section 15—Sick Industrial Companies (Special Provisions) Act, 1985—Section 22—Appointment of an arbitrator due to the named arbitrator's refusal to act—The dispute arose from a hire purchase agreement for machinery exports—The respondent argued against arbitration, citing its status as a sick company under the Sick Industrial Companies (Special Provisions) Act, 1985—The court rejected the objection, stating that SICA does not debar arbitration proceedings—While the named arbitrator initially declined, subsequent information indicated his willingness—The court appointed Mr. Manabu Nonoguchi as the arbitrator to resolve the disputes between the parties. ...
Partnership Act, 1932—Section 69—Arbitration Act, 1940—Section 20—Uttaranchal's judgment and order allowing an appeal filed under Section 39(iv) of the Arbitration Act, 1940. The dispute arose from a 1988 agreement for civil works, and the respondent sought arbitration under Clause 34 of the contract. The trial court rejected the application due to the respondent's unregistered status—The High Court, relying on the 1996 Arbitration and Conciliation Act, allowed the appeal, directing the parties to resort to the new Act for arbitration—The appellant argued that the unregistered status barred arbitration, and the 1996 Act was inapplicable due to the initiation of arbitral proceedings in 1991—The Supreme Court set aside the High Court's judgment, emphasizing the applicability of the 1940 ...
Limitation Act, 1963—Section 14—Arbitration Act, 1940—Section 14—Expressions "commencement of arbitration proceeding" and "commencement of a proceeding before an arbitrator" carry different meanings—The context in which these expressions are used determines their significance—A notice of arbitration serves as the first essential step for the default appointment in accordance with the Arbitration Act, 1940—The procedure for appointing an arbitrator varies under the 1940 Act compared to the 1996 Act. Section 21 of the 1996 Act interprets the "commencement of arbitration," starting with a notice of arbitration for certain purposes—The service of a notice for the appointment of an arbitrator is the relevant date for the commencement of arbitration proceedings—...
Arbitration And Conciliation Act, 1996—Section 2(2)—Arbitration Jurisdiction: Indian Legislative Intent and Interpretation—The court clarifies the legislative intent behind the Arbitration and Conciliation Act, emphasizing that Part I applies to arbitrations within India but doesn't explicitly exclude those outside—The absence of such exclusion allows parties, by agreement, to exclude non-derogable provisions in international commercial arbitrations abroad—The court reconciles Section 1 and Section 2(2) harmoniously—It highlights Section 9, affirming that applications for interim relief are permissible in India, regardless of the arbitration's location—The court emphasizes that Section 9 doesn't cover all challenges, limiting it to specific interim measures—Additionally, it under...
Arbitration Act, 1940—Section 32, Section 33, Section 34—Foreign Awards (Recognition and Enforcement) Act, 1961, under Section 7, addresses the enforceability of arbitration agreements—In a case where a decision in an arbitration suit treated as an arbitration petition under Section 33 of the Arbitration Act establishes the existence of an arbitration agreement between the parties, it operates as res judicata for the enforcement of a foreign award—The scheme outlined in Sections 3 and 7 of the Act encompasses questions regarding the existence, validity, or effect of an arbitration agreement—The court can decide such questions at various stages: before the arbitration proceedings commence, during their pendency, or after the award is made and filed in the court for enforcement—The Supreme Court clarified...
Arbitration Act, 1940—Section 10, Section 10(1), Section 10(2), Section 20—Matters of arbitration, where an arbitration clause specifies the strength of the arbitral tribunal to consist of three arbitrators, with each party appointing two arbitrators who, in turn, appoint a third arbitrator to act as the Chairman, the third arbitrator is not automatically deemed to be an Umpire unless expressly provided in the agreement—The interpretation should align with the parties' intention that the dispute be resolved by three arbitrators, and the third arbitrator has the authority to sit as a member of the arbitral tribunal alongside the other two arbitrators—Purposive construction in the interpretation of statutes is emphasized, asserting that if there are two possible interpretations, the one that aligns with fulfillin...
Intervention Application in Arbitration Case: In an arbitration case where an order was passed with the consent of the parties appointing them as joint receivers and providing various directions, including taking possession of immovable property, the appellant, though not a party to the earlier proceedings, filed an intervention application—The High Court rejected the application citing delay and laches, as the appellant failed to take action to deliver possession despite communication of the earlier order—The Supreme Court set aside the order rejecting the intervention application, emphasizing that the appellant's valuable rights over the immovable property were adversely affected by the earlier directions—The Court held that the delay was justifiable in light of the circumstances, and the case was remanded to the H...
Arbitration and Conciliation Act, 1996—Section 11(5), Section 16—Jurisdiction of Chief Justice's nominee under Section 11(5)—Existence of Arbitration Agreement: These petitions, filed under Section 11(5) of the Act, involve disputes arising from transactions between Nimet Resources Inc—(a Canadian company) and M/s—Essar Steels Ltd—The parties had entered into a sales contract for Ferro Vanadium with an arbitration clause—The respondent denied the existence of the contract and arbitration agreement—The petitioner argued for the exercise of powers under Section 11 of the Act, while the respondent contended that Section 16 empowers the arbitral tribunal to rule on the existence or validity of the arbitration agreement—The court, after a prima facie examination, held that the matter sh...
Arbitration And Conciliation Act, 1996—Exercising the power to refer parties to arbitration under Sections 8 and 42—To trigger this power, the following conditions must be satisfied: (1) the existence of an arbitration agreement; (2) initiation of a court action by one party against the other; (3) alignment of the subject matter of the court action with the arbitration agreement; and (4) the other party's motion for arbitration referral before submitting the first statement on the dispute.Notably, the Court highlighted that the right to adjudicate in court remains with the party initiating the action until the other party submits the first statement of defense—However, if the party seeking arbitration applies after submitting their statement and the opposing party does not object, the Court is not barred from referri...
Limitation Act, 1963—Article 137—Arbitration Act, 1940, Section 20, and 37 were invoked in a case where a contractor claimed damages and losses suffered in 1979 due to a delay in handing over the work site—A supplementary agreement in 1981 did not explicitly state that the right to claim damages was preserved—The contractor applied for the appointment of an arbitrator in 1985, well beyond the three-year limitation period from the alleged cause of action in 1979—The appointment of the arbitrator in 1985 was found to be time-barred—Additionally, the arbitrator, by awarding damages of Rs. 11 lakhs for alleged lapses or delays in handing over the work site, deliberately departed from the terms of the contract—This deliberate departure was considered a manifest disregard of the contract, rendering the ...
Arbitration Act, 1940—Section 2(a)—Arbitration by incorporation—Atlas Export Industries and Oceandale Company Limited, which included an arbitration clause referencing the Grain and Food Trade Association Ltd. (GAFTA) Standard Contract No. 15—The contract specified arbitration in London for dispute resolution, and an award was issued against Atlas in 1987—Kotak, the agent for Oceandale, sought enforcement of the award in India under the Foreign Awards (Recognition and Enforcement) Act, 1961—Atlas contested, arguing that there was no written agreement for arbitration and that the contract was against public policy—The court rejected Atlas' contentions, holding that the arbitration clause was incorporated by reference, and parties were aware of GAFTA's terms—Exception 1 to Section 28 o...
Constitution of India, 1950—Article 226, Article 32—Arbitration Act, 1940, Section 21, the Supreme Court set aside a judgment by the High Court of Madhya Pradesh—The dispute was initially referred to an informal forum, the Indore Development Authority, by the parties for an expeditious decision—The High Court, in a Public Interest Litigation (PIL) entertained at the behest of an individual with no direct interest in the litigation, quashed the decision and award of the arbitrator—The Supreme Court held that Section 21 does not prohibit parties from referring a dispute to an arbitrator, especially when seeking a faster and less expensive resolution—The High Court's intervention was deemed erroneous, as it speculated on extraneous considerations without supporting evidence—Consequently, the Supr...
Civil Procedure Code, 1908 (CPC)—Order 6 Rule 17, Order 7 Rule 1—Application against the order of the High Court, allowing an amendment to the respondent's application under Section 20 of the Arbitration Act, 1940—The respondent sought to convert the application into a suit for the recovery of a sum from the appellant—The trial court had rejected this amendment, citing a change in the nature of the suit and the claim being barred by limitation—The High Court, relying on inherent jurisdiction, allowed the amendment—The Supreme Court held that Section 20 of the Arbitration Act deals with a stage prior to the institution of a suit and does not convert the application into a plaint—The amendment introducing a new cause of action and changing the nature of the suit would cause prejudice to the appe...
Arbitration Act, 1940—Section—33—Arbitration—Appellant had submitted Tenders I and II to the respondents for certain civil works—Subsequently, a claim for payment of money arose—The appellant filed an application under Section 33 of the Arbitration Act, seeking a declaration that the agreement between the parties no longer subsists, as the work was completed, and Respondent 1 received full and final settlement—It was argued that the arbitration clause is not applicable in such a situation—The court held that the determination of the amount due and the tenability of the appellant's claim are matters for the arbitrator to decide—The court set aside the High Court's order and dismissed the application under Section 33 of the Arbitration Act—The appeal was allowed. ...
Arbitration Act, 1940—Section—32, 33—Initiation of arbitration proceedings—Alleging fraud in the pre-qualification bid stage—The appellant claimed the architect falsely stated receiving ten bids, leading to the award of the contract to Respondent 2—The High Court found that even if fraud occurred, it was limited to the pre-qualification stage and had no bearing on the accepted tender—It noted the appellant's participation in 11 arbitration proceedings, implying acquiescence—The appellant argued that fraud vitiated the entire contract, making arbitration inappropriate—The Supreme Court disagreed, stating that the fraud was confined to the pre-qualification stage, and the accepted tender concluded a valid contract—The appellant's extensive participation in arbitration proce...
Arbitration Act, 1940—Section 31—Civil Procedure Code, 1908 (CPC)—Section 24—Supreme Court granted leave in a case concerning arbitration proceedings between the appellants and respondents—The High Court, in its judgment, held that the Subordinate Court at Tuticorin lacked jurisdiction over the arbitration and directed the transfer of proceedings to the High Court under Section 24 of the CPC—Consequently, the appellants received a notice from the High Court regarding the transfer, requiring additional court fees—However, when the appellants filed objections to the award, the High Court deemed them barred by limitation, as they were filed more than 30 days after receiving the notice from the Subordinate Court—The Supreme Court, considering the jurisdictional issue, ruled that any notice from ...
Arbitration and Conciliation Act, 1996—Section 45, Section 50—Delhi High Court Act, 1966—Section 10—Conflicting opinions on appealability of decisions under Section 45 of the Arbitration and Conciliation Act—Matter referred to Bench of three Judges—Question arises whether appeal lies to Division Bench from decision of single judge—Section 10 of Delhi High Court Act and Clause 10 of Letters Patent not considered in earlier decisions—State of West Bengal v. M/S Gourangalal Chatterjee (1993) 3 SCC 1 supports view taken by High Court—Union of India v. Mohindra Supply Company (AIR 1962 SC 256) and Vanita M. Khanolkar v. Pragna M. Pai (AIR 1998 SC 424) cited in conflict—Conflict of decisions necessitates reference to Bench of three Judges for resolution. ...
Arbitration and Conciliation Act, 1996—Section 7—Civil Procedure Code, 1908 (CPC)—Order 6 Rule 16, Section 151—An arbitration agreement requires the intention of the parties to have disputes resolved judicially, with evidence presented and a decision based solely on the material provided—In a memorandum of understanding between family groups, with a clause for dispute settlement by the Chairman of a Financial Corporation, the intention was not for a judicial determination but rather for expert valuation and division of assets—The Chairman's decision-making process did not meet the criteria of arbitration, as he was not bound by evidence or submissions and could make inquiries and use his expertise freely—Thus, the decision was not an arbitration award—Challenging the decision through a c...
Arbitration Act, 1940—Section 20—Contract with the respondent for construction work, including a theatre—Disputes arose during execution, leading to arbitration—The appellant sought arbitration under Clause 73 of the Madras Detailed Standard Specifications (MDSS)—However, the High Court ruled that the contract excluded arbitration, and Clause 73 did not apply—The Supreme Court upheld this decision, noting that the contract expressly excluded arbitration and that MDSS terms referred only to work execution, not dispute resolution—Therefore, there was no arbitrable agreement, and the civil court couldn't appoint an arbitrator—The appeal was dismissed, with no costs awarded. ...
Arbitration Act, 1940—Section 28, Section 3—Hardyal and the State of Punjab, involving an arbitration clause stipulating reference to the Superintending Engineer, disputes arose, leading to arbitration—The arbitrator delivered an award post the statutory four-month period, stipulated by Clause 3 of the First Schedule of the Arbitration Act, 1940—Despite the respondent's participation in proceedings after this period, he challenged the award under Section 30 on grounds of delay and misconduct—The Senior Sub-Judge upheld the award, dismissing the objections—Upon appeal, the High Court held that participation post the statutory period does not imply waiver, nor does it constitute a court-approved extension under Section 28—The Supreme Court concurred, emphasizing statutory adherence and judicial ...