Arbitration Cases Monthly Digest: July 2024
Mohd Talha Hasan
14 Aug 2024 12:30 PM IST
Supreme Court
Avoid Bulky Pleadings & Lengthy Submissions In Arbitration Appeals : Supreme Court To Advocates
Case Title: Bombay Slum Redevelopment Corporation Private Limited Versus Samir Narain Bhojwani
Citation : 2024 LiveLaw (SC) 445
Expressing displeasure over the filing of bulky and lengthy submissions in the arbitral proceedings, the Supreme Court on Monday (July 8) called upon the Bar to urge only the legally permissible grounds in the arbitration proceedings carried under Sections 34 and 37 of the Arbitration and Conciliation Act, 1996. “When members of the bar take up so many grounds in petitions under Section 34, which are not covered by Section 34, there is a tendency to urge all those grounds which are not available in law and waste the Court's time. The time of our Courts is precious, considering the huge pendency. This is happening in a large number of cases. All this makes the arbitral procedure inefficient and unfair. It is high time that the members of the Bar show restraint by incorporating only legally permissible grounds in petitions under Section 34 and the appeals under Section 37.”, the bench comprising Justices Abhay S. Oka and Pankaj Mithal said.
Case Title – State of West Bengal & Ors. v. Rajpath Contractors and Engineers Ltd.
Citation : 2024 LiveLaw (SC) 454
The Supreme Court reiterated that if an arbitral award is challenged beyond the three-month limitation, the benefit of section 4 of the Limitation Act will not be available. The Court held that the 30-day extension period mentioned in the proviso to Section 34(3) of the Arbitration and Conciliation Act 1996 cannot be included in the "prescribed period" in Section 4 of the Limitation Act 1963.
Case Details: SBI GENERAL INSURANCE CO. LTD. Versus KRISH SPINNING
Citation : 2024 LiveLaw (SC) 489
The Supreme Court held that while deciding a Section 11(6) petition for an appointment of an arbitrator, the referral courts must not conduct an intricate evidentiary enquiry into the question of whether the claims raised by the applicant are time-barred and should leave that question for determination by the arbitrator. The Court said that the referral court should limit its enquiry to examining whether the Section 11(6) application has been filed within the period of limitation of three years or not.
Dispute Regarding Full & Final Settlement Of Contract Is Arbitrable : Supreme Court
Case Details: SBI GENERAL INSURANCE CO. LTD. Versus KRISH SPINNING
Citation : 2024 LiveLaw (SC) 489
The Supreme Court held that if any dispute arises as to whether a contract has been discharged or not, such a dispute is arbitrable. “Once the contract has been discharged by performance, neither any right to seek performance, nor any obligation to perform remains under it.However, whether there has been a discharge of contract or not is a mixed question of law and fact, and if any dispute arises as to whether a contract has been discharged or not, such a dispute is arbitrable as per the mechanism prescribed under the arbitration agreement contained in the underlying contract.”, the Court said.
Case Title – Elfit Arabia & Anr v. Concept Hotel BARONS Limited & Ors
Citaiton : 2024 LiveLaw (SC) 494
The Supreme Court recently observed that initiation of proceedings under the Negotiable Instruments Act, 1881 for cheque dishonour does not constitute continuing cause of action for initiating arbitration under the Arbitration and Conciliation Act, 1996 (A&C Act). A bench of Chief Justice of India DY Chandrachud, Justice JB Pardiwala, and Justice Manoj Misra dismissed an arbitration petition seeking the appointment of an arbitrator eleven years after cheques were dishonoured, on the ground that the claims were barred by limitation.
High Courts:
Allahabad High Court
Case Title: State Of U.P. And Others vs. M/S Harish Chandra India Limited 2024
Case Citation: 2024 LiveLaw (AB) 418
The Allahabad High Court has directed the Principal Secretary (Law), Uttar Pradesh to take steps to avoid delays in filing arbitration appeals beyond statutory limitations by the State Government and submit a report on the actions taken in this regard within 6 months.
Case Title: Savitri Devi v. Union of India and others
Case Citation: 2024 LiveLaw (AB) 430
Elucidating on the applicability of the judgment of the Supreme Court in Union of India v. Tarsem Singh and Ors (2019), the Allahabad High Court has held that “retroactive application of judicial decisions to arbitral awards would create legal and procedural chaos.” For context, in Tarsem Singh (supra), the Apex Court held that the provisions regarding solatium and interest provided in the Land Acquisition Act would apply to acquisitions made under the National Highways Act. The court also held that this ruling of the Supreme Court shall apply to all pending cases.
Allahabad High Court Sets Aside Part Of Award Dealing With Non-Arbitrable Dispute
Case Title: M/S Shyam Lalit Dubey And Another vs. Union Of India Thru. Ganeral Manager Northern Railway Baroda House, New Delhi And Another
Case citation: 2024 LiveLaw (AB) 446
The Allahabad High Court has held that disputes regarding works undertaken by party independent of the contract which contains the arbitration agreement cannot be determined under such arbitration agreement.
The bench comprising Chief Justice Arun Bhansali and Justice Vikas Budhwar held, “wherein some extra work etc. pertaining to the same contract has been undertaken may form part of the arbitrable dispute, however, in an arbitral dispute with reference to quantum meruit or Section 70 of the Act, 1872, for a work undertaken which is wholly independent of the contract containing the arbitration clause, the same cannot become an arbitral dispute.”
Bombay High Court
Case title: Ivory Properties & Hotels Private Limited vs. Vasantben Ramniklal Bhuta & Ors. (OS-COMAP-90-2020 and COMAP-91-2020)
Citation: 2024 LiveLaw (Bom) 342
The Bombay High Court set-aside an Arbitral Award under Section 34 of the Arbitration and Conciliation Act, 1996 (A&C Act) as the Arbitrator relied on a non-executed agreement for arriving at the decision. The Court stated that it can annul an arbitral award under Section 34 if the arbitrator adopted a non-judicial approach. The Division Bench of B.P. Colabawalla and Somasekhar Sundaresa were considering a commercial appeal filed by the appellant against Bottom of Forma Single Judge Bench's decision to set aside the Arbitral Award under Section 34 of A&C Act.
Individual Members Of Society Can't Be Considered Signatories To The Arbitration Agreement: Bombay High Court
Case Title: Shankar Vithoba Desai And Ors Vs Gauri Associates And Anr
Case Number: COMM. ARBITRATION APPLICATION (L.) NO. 21070 OF 2023
The Bombay High Court bench of Justice Somasekhar Sundaresan has held that individual members of the Society cannot be considered signatories to the arbitration agreement under Section 7 of the Arbitration Act, as they do not individually participate in its formation or execution of arbitration clause.
Courts Can't Constantly Interfere And Micro-Manage Arbitral Proceedings: Bombay High Court
Case Title: Ambrish H. Soni vs Mr Chetan Narendra Dhakan & Ors.
Case Number: ARBITRATION PETITION NO. 100 OF 2024 with COMMERCIAL ARBITRATION PETITION (L) NO. 33385 OF 2023
The Bombay High Court bench of Justice Arif S. Doctor has held that the court cannot constantly interfere with and micromanage proceedings which are pending before Arbitral Tribunals. The bench held that the scope of judicial interference under Section 37(2)(b) of the Arbitration Act is limited in nature.
Doctrine Of Separability; Arbitration Agreement Survives Termination Of Main Contract: Bombay High Court
Case Title: EBIX Cash Pvt. Ltd vs State of Maharashtra and ors.
Case Number: WRIT PETITION NO.6707 OF 2024
The Bombay High Court bench of Justice R. G. Avachat and Justice Neeraj P. Dhote has held that an arbitration agreement survives the termination of the main contract facilitating the resolution of disputes arising under or in connection with the contract. Therefore, the bench dismissed a writ petition noting that the dispute was arbitral and fell within the ambit of the arbitration clause.
Calcutta High Court
Case Title: M/S. B.B.M. Enterprises Vs State Of West Bengal And Ors.
Case Number: AP/535/2022
The Calcutta High Court bench of Justice Sabyasachi Bhattacharyya has held that it is completely beyond the domain of the Chief Justice and/or his designate, sitting in jurisdiction under Section 11 of the Arbitration and Conciliation Act, 1996, to adjudicate even prima facie on the merits of an arguable issue involved in the matter, which would fall categorically within the domain of adjudication by the Arbitrator.
Case Title: Kotak Mahindra Bank Limited Vs Shalibhadra Cottrade Pvt. Ltd. And Ors.
Case Number: Execution Case No. 193 2019
The Calcutta High Court bench of Justice Sabyasachi Bhattacharyya has held that even a unilateral appointment of the arbitrator, without any further allegation of bias under Section 12(5) of the Arbitration and Conciliation Act, 1996, renders the Arbitrator ineligible. The bench held that in addition to the grounds specifically mentioned in Section 12(5) read with the Seventh Schedule unilateral appointment of Arbitrator by one of the parties itself has also been brought under the purview of diqualification by ineligibility.
Case Title: M/s Zillion Infraprojects Pvt Ltd Vs Bridge and Roof Co India Ltd
Case Number: AP-COM No. 77 of 2024 and AP No. 407 of 2022
The Calcutta High Court bench of Justice Sabyasachi Bhattacharyya has struck part of the arbitration clause as being violative of Article 14 of the Constitution. The clause prevented the subcontractor from participating in arbitration proceedings despite having to bear the expenses for its claims. Further, it allowed the Indian Oil Corporation (IOCL) to unilaterally decide whether a dispute could be referred to arbitration, thus depriving the subcontractor of an independent right to raise disputes.
2063 Crore Arbitral Award: Calcutta High Court Directs West Bengal Government, WBIDC To Pay Amount
Case Title: Government of West Bengal & Anr. Versus Essex Development Investments (Mauritius) Ltd.
Case Number: A.P. (COM) 28 of 2023 with IA No. G.A. (COM) 1 of 2024
The Calcutta High Court bench of Justice Krishna Rao has rejected the petition made under Section 36 of the Arbitration and Conciliation Act, 1996 by the West Bengal Government and West Bengal Industrial Development Corporation claiming fraud in making of the arbitral award. The bench noted that the arbitral tribunal arrived upon the findings after considering the materials placed before it and the submissions made by the respective parties.
Case Title: K2V2 Hospitality Llp Vs Limton Electro Optics Pvt. Ltd. And Ors.
Case Number: AP/472/2023
The Calcutta High Court bench of Justice Sabyasachi Bhattacharyya has held allowed composite reference of two companies to arbitration noting that the two arbitration agreement refer to the self-same demised property. Moreover, it noted that both the agreements were entered into by the same proposed lessee with two co-owners of the self-same property. The bench held that: “if two different references were to be made, there would be ample scope of conflict of decision pertaining to the self-same subject matter between the co-owners of the self-same property.”
Case Title: Future Market Networks Ltd. Vs Laxmi Pat Surana & Anr
Case Number: AP-COM/135/2024 (Old Case No. AP/698/2016)
The Calcutta High Court bench of Justice Subhendu Samanta has held that the Supreme Court's observations regarding the interpretation of "three months" in Section 34(3) of the Arbitration and Conciliation Act, 1996 as 90 days in various cases were not the ratio decidendi but obiter dicta. The bench held that the period of limitation must be computed based on calendar months, therefore, the period of limitation in Section 34(3) would be three months excluding the date of receipt of the arbitral award.Invocation of Arbitration Beyond Stipulated Period In Clause Does Not Frustrate Parties' Intent To Arbitrate: Calcutta High Court
Case Title: The Incoda Vs The General Manager, Metro Railway And Anr.
Case Number: AP/611/2022
The Calcutta High Court bench of Justice Sabyasachi Bhattacharyya has held that the invocation of arbitration after the period defined in the arbitration clause doesn't frustrate the intention of the parties to refer disputes to arbitration.
The bench held that the outer limit stipulated in the arbitration clause for invocation of arbitration if failed by the claimant, does not constitute a waiver or a deliberate relinquishment of the claim by the claimant.
Arbitral Award In Violation Of Contractual Bar Is Patently Illegal: Calcutta High Court
Case Title: Union Of India Vs M/S J K Enterprise
Case Number: AP/105/2021 IA NO: GA/1/2021, GA/2/2021
The Calcutta High Court bench of Justice Sabyasachi Bhattacharyya has held that an arbitral award in violation of a bar contained in the contract is beyond the arbitrator's jurisdiction. The bench held that such an award categorically vitiated under Section 34(2)(a)(iv) of the Arbitration and Conciliation Act, 1996, as well as by patent illegality as envisaged in Sub-section (2-A) of Section 34.
Single Judge Of Commercial Division Has Jurisdiction Over Original Applications In International Commercial Arbitration: Calcutta High Court
Case Title: Uphealth Holdings Inc Vs Glocal Healthcare Systems Pvt Ltd And Ors and Connected Matters
Case Number: AP-COM/490/2024 IA NO: GA-COM/1/2024, GA-COM /8/2024 and Connected Matters
The Calcutta High Court bench of Justice Sabyasachi Bhattacharyya has held that original applications related to International Commercial Arbitration are to be entertained by the Single Judge of the Commercial Division.
The High Court held that the Commercial Courts Act, 2015 defines the Commercial Division and the Commercial Appellate Division distinctly. The Commercial Division, comprised of a Single Judge as per Section 4(1), handles original applications and appeals arising from International Commercial Arbitration. In contrast, the Commercial Appellate Division, as defined in Section 5(1), consists of one or more Division Benches and deals with appeals arising from decisions made by the Commercial Division.
LLP And Its Individual Partners Can't Raise Same Issue By Separate Appeals U/s 37 Of Arbitration Act: Calcutta High Court
Case Title: Gaurav Churiwal vs Concrete Developers LLP and Ors.
Case No.: EC/283/2023
The Calcutta High Court single bench of Justice Sabyasachi Battacharyya held that an LLP and its partners cannot file separate appeals under Section 37 of the Arbitration and Conciliation Act by citing the principle of 'separate legal entity'. It was held that the principle of res judicata would apply to prevent the individual partners from raising the same issue under Section 37, if the previous appeal filed in the name of the LLP was dismissed.
'Rohan Builders' Not Binding Precedent, Court Empowered To Extend Arbitrator's Mandate Even If Section 29-A Petition Filed After Termination: Calcutta High Court
Case Title: Ashok Kumar Gupta Vs M.D. Creations And Ors.
Case Number: AP/37/2024
The Calcutta High Court bench of Justice Sabyasachi Bhattacharyya has held that the court is empowered the court is empowered to extend an arbitrator's mandate even if a petition under Section 29-A of the Arbitration and Conciliation Act, 1996, is filed after the termination of the mandate. Justice Bhattacharyya clarified that the absence of negative expressions in Section 29-A, which are present in other statutes to enforce strict timelines, indicates legislative intent to allow judicial discretion in extending mandates.
Dismissal Of First Execution Application On Default Ground Does Not Bar Fresh Petition: Calcutta High Court
Case Title: Kotak Mahindra Bank Ltd. Vs Jaymony Debnath And Ors.
Case Number: EC/8/2022
The Calcutta High Court bench of Justice Sabyasachi Bhattacharyya has held mere dismissal of the first execution application on the ground of default does not prevent the award-holder/decree-holder from filing a fresh execution petition.
The High Court held that the provisions of Rules 105 and 106 of Order 21 of the Code of Civil Procedure do not preclude the award-holder/decree-holder from filing a fresh execution case on the same cause of action after a dismissal for default. Unlike Order 9, there is no specific bar in Order 21 regarding execution cases. The bench noted that even Rule 4 of Order 9 allows for a fresh suit on the same cause of action if the previous suit was dismissed for default without the parties' presence.
Arbitrator's Reliance On Unverified Evidence Violates Fundamental Policy Of India: Calcutta High Court
Case Title: Oriental Insurance Company Limited Vs M/S. Sarada Rani Enterprises
Case Number: A.P. No. 392 of 2012
The Calcutta High Court bench of Justice Sabyasachi Bhattacharyya has held that evidence which does not qualify as pleadings supported by due verification or affidavit cannot be equated with proof of a claim. It held that the arbitrator's reliance on such evidence was contrary to the fundamental policy of Indian law.
The bench further held that the arbitrator was not in a situation where an exact figure cannot be determined, and which would require a reasonable guesswork by the tribunal.
Arbitrator's Award For Compensation For Excess Work And Business Loss Without Sufficient Evidence Is Perverse, Contrary To Fundamental Policy: Calcutta High Court
Case Title: The State Of West Bengal Vs Bijan Behari Chowdhury
Case Number: AP/224/2009
The Calcutta High Court bench of Justice Sabyasachi Bhattacharyya has held that the arbitrator's decision to award compensation to the claimant for excess work and business loss, without sufficient evidence to support these claims, is perverse and contrary to the fundamental policy of Indian law.
Delhi High Court
Case Title: Growth Techno Projects Limited Vs Ishwar Industries Limited
Citation: 2024 LiveLaw (Del) 764
The Delhi High Court bench of Justice Jasmeet Singh has held the time period starting from the filing of the petition under Section 34 of the Arbitration Act till the amendment to the Arbitration Act in 2015, stands excluded from the counting of the limitation period for the enforcement of the arbitral award.
Arbitration Clauses Require Explicit Reference In Subsequent Agreements: Delhi High Court
Case Title: Deepa Chawla Vs Raheja Developers Ltd
Citation: 2024 LiveLaw (Del) 772
The Delhi High Court bench of Justice Jasmeet Singh has held that for an arbitration clause to be enforceable in subsequent agreements, it must be explicitly referenced within those agreements. The bench noted that the subsequent agreement in the dispute contained a specific exclusion of the arbitration clause.
Arbitration Clause In Lease Agreement Invalidated By Subsequent Verbal Agreement: Delhi High Court
Case Title: Mukesh Khurana Vs Rahul Chaudhary
Citation: 2024 LiveLaw (Del) 773
The Delhi High Court bench of Justice Manoj Jain has held that the arbitration clause in a lease agreement ceases to exist if the lease terminates and a new verbal tenancy agreement is established.
Disputes Related To Lock-In Periods In Employment Contracts Are Arbitrable: Delhi High Court
Case Title: Lily Packers Private Limited Vs Vaishnavi Vijay Umak and connected matters
Citation: 2024 LiveLaw (Del) 777
The Delhi High Court bench of Justice Prathiba M. Singh has held that disputes relating to lock-in periods that apply during the subsistence of employment contracts are arbitrable under the Arbitration and Conciliation Act, 1996. The High Court held that the three-year lock-in period did not constitute an unreasonable curtailment of the employees' right to employment and did not violate any fundamental rights. It noted that such clauses are typically negotiated voluntarily and entered into with mutual consent.
Case Title: GJ (JV) Comprising of M/S Godara Construction Company M/S Jandu Construction India Pvt. Ltd. Vs Union Of India
Citation: 2024 LiveLaw (Del) 778
The Delhi High Court bench of Justice Prateek Jalan has held that panel comprising of serving or retired officers of Railways not only restricted the party's choice but also compelled it to choose its nominee from amongst four names suggested by the Railways.
The bench noted that such a panel is not in consonance with the judgment of the Supreme Court in Central Organisation for Railway Electrification v. ECI-SPIC-SMO-MCML (JV).
Case Title: Murari Lal Agarwal Vs Kmc Construction Limited & Ors.
Citation: 2024 LiveLaw (Del) 780
The Delhi High Court bench of Justice Prateek Jalan has held that in a 'two-contract case', a specific reference to the arbitration clause in an earlier contract is necessary for its incorporation into the main contract between the parties.
A 'two-contract case' refers to a situation where there are two separate contracts involved and the parties seek to incorporate terms, including an arbitration clause, from one contract into another.
Case Title: M/S Dhawan Box Sheet Containers Pvt Ltd Vs M/S Sel Manufacturing Co Ltd
Citation: 2024 LiveLaw (Del) 781
The Delhi High Court bench of Justice Prateek Jalan has held that when parties engage in actions based on invoices containing arbitration clauses, demonstrating mutual acceptance, an arbitration agreement may be inferred directly from those invoices.
Case Title: Nafees Ahmed Vs Delhi Tourism And Transportation Development Corporation Ltd
Citation: 2024 LiveLaw (Del) 782
The Delhi High Court bench of Justice C. Hari Shankar has held that coercion, or its absence in a dispute is a complex question, purely of fact, which has necessarily to be examined by the arbitral tribunal. The bench held that with the introduction of sub-Section 6(A) in Section 11, the jurisdiction of the referral court is now circumscribed.
Case Title: Reliance Communications Limited Vs Unique Identification Authority Of India
Citation: 2024 LiveLaw (Del) 784
The Delhi High Court bench of Justice C. Hari Shankar has dismissed a petition filed by Reliance Communications under Section 34 of the Arbitration and Conciliation Act, 1996 noting that the arbitrator correctly divided the total number of call seconds by 60 to determine the number of call minutes. The bench noted that the company is not entitled to a whole minute if the call lasted only part of a minute.
Case Title: Mukesh Udeshi vs Jindal Steel Power Ltd. and Anr.
Citation: 2024 LiveLaw (Del) 788
The Delhi High Court bench of Justice Pratibha M. Singh held that only parties to an arbitration agreement can challenge the award under Section 34 of the Arbitration and Conciliation Act, 1996. It was further held that 3rd-party beneficiaries of domain names in India, who are impacted by the arbitral award, lack the standing to challenge the award.
Case Title: The Deputy Commissioner Of Police Vs Score Information Technologies Ltd
Citation: 2024 LiveLaw (Del) 789
The Delhi High Court bench of Justice Vibhu Bakhru and Justice Tara Vitasta Ganju has held that the arbitral tribunal may exercise its power to award compensation for breach if a Contract has become incapable of specific performance. Further, the bench held that the interpretation of a contract is a matter for an arbitrator to determine. It held that even if such interpretation gives rise to an erroneous application of the law, the courts will generally not interfere unless the error is palpably perverse or illegal and goes to the root of the matter.
Disobedience Of Interim Measures Due To Insolvency Proceedings Is Not Contempt: Delhi High Court
Case Title: Mr.Rajan Chadha & Anr Vs Mr.Sanjay Arora & Anr.
Citation: 2024 LiveLaw (Del) 790
The Delhi High Court bench of Justice Mini Pushkarna has held that disobedience of interim measures granted under Section 9 of the Arbitration and Conciliation Act, 1996 due to insolvency proceedings does not warrant contempt charges.
The bench held that if the disobedience results from circumstances beyond the contemnor's control, such as financial constraints or ongoing disputes that impact compliance, contempt charges are not justified.
Case Title: Welspun Enterprises Ltd Vs Kasthuri Infra Projects Pvt Ltd
Citation: 2024 LiveLaw (Del) 79
The Delhi High Court bench of Justice C. Hari Shankar has held that once an Arbitral Tribunal is in place, ordinarily a court should refrain from dealing with the matter even for the purposes of passing interlocutory orders unless the order is demonstrably one which cannot await the application of mind by the Arbitral Tribunal. The bench held that: “. If party is able to convince the Court that by the time the application is taken up by the Arbitral Tribunal, the prejudice that may result would be irreparable, it may be justified for the Court to take up the matter even when the Arbitral Tribunal is in seisin of the disputes.”
Case Title: Indian Railway Catering And Tourism Corporation Ltd. Vs M/S Deepak And Co
Citation: 2024 LiveLaw (Del) 799
The Delhi High Court bench of Justice Jasmeet Singh has held that findings made by an arbitrator which are consistent with the documentary evidence and admissions made during cross-examination are reasonable and not perverse.
The High Court referred to the decision of the Supreme Court in Associate Builders v. DDA where the Supreme Court held that the grounds for setting aside an arbitral award under Section 34(2)(a) of the Arbitration Act do not encompass the merits of the award. Instead, they are limited to issues such as public policy and procedural fairness. The Supreme Court highlighted that the principle of judicial approach requires decisions to be fair, reasonable, and objective. Arbitrary or whimsical decisions are not fair or reasonable.
Case Title: Assets Care And Reconstruction Enterprise Limited Vs Domus Greens Private Limited & Ors.
Citation: 2024 LiveLaw (Del) 803
The Delhi High Court bench of Justice Jasmeet Singh has held that a third party, whose rights for a registered charge are affected by an arbitral award, can challenge such award under Section 37 of the Arbitration and Conciliation Act, 1996.
Section 11(6) Petition Not Maintainable Without Prior Section 21 Notice In Arbitration Proceedings: Delhi High Court
Case Title: M/S Kotak Mahindra Prime Ltd Vs Manav Sethi & Anr.
Citation: 2024 LiveLaw (Del) 805
The Delhi High Court bench of Justice C. Hari Shankar has held that a Section 11(6) petition under Arbitration and Conciliation Act, 1996 is not maintainable unless it is preceded in the first instance by a Section 21 notice.
The bench noted that the notice serves the crucial purpose of informing the opposing party about the claims asserted, allowing for potential acceptance, clarification of claims, assertion of defenses, or identification of counter-claims.
Intention To Arbitrate Must Be Assessed Holistically In Transactions Involving Interlinked Agreements, Even If Some Agreements Lack Explicit Arbitration Clauses: Delhi High Court
Case Title: Nishesh Ranjan and Anr. vs Indiabulls Housing Finance Ltd. and Anr.
Citation: 2024 LiveLaw (Del) 807
The Delhi High Court single bench of Justice Pratibha M. Singh held that in a composite transaction involving multiple interlinked agreements, courts should assess the intention to arbitrate holistically and refer disputes to arbitration even if some agreements lack explicit arbitration clauses.
Decree Holder Not Entitled To Interest For Period Between Deposit of amount and its Release : Delhi High Court
Case Title: M/S Ramacivil India Constructions Pvt. Ltd. Vs Union Of India
Citation: 2024 LiveLaw (Del) 808
The Delhi High Court bench of Justice C. Hari Shankar has held that the Decree Holder is not entitled to interest on the amount deposited by the Judgment Debtor for the period between the date of deposit and the date of release permitted by the court.
The bench held that the entitlement to interest does not extend to the period between the deposit and the withdrawal application if the deposit was unconditional and available for withdrawal without any impediment.
'Subsequent Shareholders' Do Not Qualify As 'Association Or Body of Individuals' Under Section 2(1)(f)(iii) Of Arbitration Act: Delhi High Court
Case Title: M/S Ktc India Pvt. Ltd Vs Randhir Brar & Ors
Citation: 2024 LiveLaw (Del) 809
The Delhi High Court bench of Justice Prateek Jalan has held that “subsequent shareholders,” each holding a specific number of shares and having the right to exit the company under defined conditions while undertaking individual rights and obligations, do not qualify as an "association or body of individuals" under Section 2(1)(f)(iii) of the Arbitration and Conciliation Act, 1996. Therefore, the High Court classified the arbitration as “international commercial arbitration” because one of the shareholders was a national and habitual resident of a country outside India.
Arbitrator Must Determine Validity Of Coercion Claims In Settlement Agreements, Termination Of Arbitration Improper: Delhi High Court
Case Title: Gae Projects (P) Ltd. Vs Ge T&D India Ltd. (Formerly Alstom T&D India Ltd.)
Citation: 2024 LiveLaw (Del) 810
The Delhi High Court bench of Justice Neena Bansal Krishna has held that claims of coercion or economic duress in a settlement agreement require examination by an arbitrator to determine their validity. The bench held that the Arbitrator's summary dismissal of the claimant's plea and the termination of arbitration proceedings without a trial were improper.
Act of God Does Not Justify Retention Of Performance Bank Guarantee Without Suffering Legal Injury: Delhi High Court
Case Title: M/s Ntpc Vidyut Vyapar Nigam Ltd Vs Oswal Woolen Mills Ltd
Citation: 2024 LiveLaw (Del) 818
The Delhi High Court bench of Justice Rajiv Shakdher and Justice Amit Bansal has held that a force majeure event specifically an Act of God beyond the control of the concerned party doesn't require retention of performance bank guarantee. The bench held that a party cannot retain monies recovered through encashment of Performance Bank Guarantee on account of liquidated damages without having averred that it had suffered a legal injury on account of the delay in commissioning, which was only a couple of hours.
Disputed Contract, Can't Be Challenged U/s 34 Of Arbitration Act Unless finding are Unreasonable: Delhi High Court
Case Title: Noble Chartering Inc. vs Steel Authority of India Ltd.
Citation: 2024 LiveLaw (Del) 819
The Delhi High Court division bench of Justice Vibhu Bakhru and Justice Tara Vitasta Ganju held that the interpretation of a disputed contract falls within the arbitral tribunal's domain and is not subject to challenge under Section 34 of the Arbitration and Conciliation Act, 1996 unless the interpretation is unreasonable.
Courts Can't Undertake Independent Assessment Of Award In Appeal U/s 37 Of Arbitration Act: Delhi High Court
Case Title: M/s BPL Limited vs M/s Morgan Securities & Credits Pvt. Ltd.
Citation: 2024 LiveLaw (Del) 820
The Delhi High Court division bench of Justice Yashwant Varma and Justice Dharmesh Sharma reiterated that while entertaining an arbitration appeal under Section 37 of the Arbitration Act, the role of a court is limited to ascertaining whether the exercise of power under Section 34 has exceeded the scope of the provision. In such cases, the High Court held that courts cannot undertake an independent assessment of the merits of the award.
Misunderstanding Of Basic Contractual Framework Vitiates Arbitral Award: Delhi High Court
Case Title:Trans Engineers India Private Limited Vs Otsuka Chemicals (India) Private Limited
Citation: 2024 LiveLaw (Del) 830
The Delhi High Court bench of Justice Sachin Datta has held that an award with misreading/misunderstanding of the basic contractual framework vitiates it at its root and makes it vulnerable to challenge under Section 34(2)(b)(ii) and 34(2A) of the Arbitration and Conciliation Act, 1996.
Non-Signatories Can Be Included In Arbitration Beyond Group Company Ties: Delhi High Court
Case Title: Rbcl Piletech Infra Vs Bholasingh Jaiprakash Construction Limited & Ors.
Citation: 2024 LiveLaw (Del) 834
The Delhi High Court bench of Justice C. Hari Shankar has held the inclusion of a non-signatory in arbitral proceedings is not solely dependent on the non-signatory being part of the same group of companies as the signatory.
The bench further clarified that a non-signatory can be included in arbitration if there is a contractual relationship that makes the non-signatory partially or wholly responsible for obligations towards the claimants.
Section 34 Of Arbitration Act Can't Be Used To Seek Re-Litigation: Delhi High Court
Case Title: Krishan Kumar & Anr Vs Shakuntla Agency Pvt Ltd
Citation: 2024 LiveLaw (Del) 854
The Delhi High Court bench of Justice C. Hari Shankar has held that that Section 34 of the Arbitration and Conciliation Act, 1996 cannot be used as a tool for a litigant to desist from participating in the arbitral proceedings, despite being fully aware thereof, and, thereafter, seek a “second bite at the arbitral cherry”. The bench further held that under Section 34 the court cannot enter into a re-appreciation of facts.
Case Title: Sharad Bhansali & Anr. Vs Mukesh Aggarwal & Anr.
Citation: 2024 LiveLaw (Del) 855
The Delhi High Court bench of Justice C.Hari Shankar has held that Article 23A of Schedule I-A of the Stamp Act applicable in Delhi covers Agreement to Sell to which Section 53A of the Transfer of Property Act (TPA) applies.
Section 53A of the TPA is designed to protect a transferee who has part performed a contract for the transfer of immovable property. To avail of this protection, the transferee must demonstrate that the contract was in writing, signed by or on behalf of the transferor, that possession of the property was taken by the transferee, that some act was done in furtherance of the contract, and that the transferee has either performed or is willing to perform their part of the contract.
Arbitrators Must Separately Calculate Fees For Claims And Counterclaims In Ad Hoc Arbitration: Delhi High Court
Case Title: Ahluwalia Contracts India Limited Vs Union Of India Through Executive Engineer Cpwd & Anr.
Citation: 2024 LiveLaw (Del) 858
The Delhi High Court bench of Justice Jasmeet Singh has set aside computration of fee by an arbitration on the basis decision in Rail Vikas Nigam Ltd. vs. Simplex Infrastructures Ltd which was later set aside in ONGC Ltd. v. Afcons Gunanusa JV, 2022 LiveLaw (SC) 723.
The bench held that in ad hoc arbitration, the arbitrator must calculate fees separately for claims and counterclaims, with the ceiling limit in the Fourth Schedule applied separately to each.
Gauhati High Court
Writ Jurisdiction Can't Be Invoked In View Of Arbitration Clause Except For Specific Circumstances: Gauhati High Court
Case Title: Anupam Saikia vs The State Of Assam And 6 Ors
Case Number: WP(C)/3688/2024
The Gauhati High Court bench of Justice Michael Zothankhuma has held that writ jurisdiction cannot be invoked in the presence of an arbitration clause, except under specific circumstances. The bench observed that the Petitioner did not demonstrate a violation of fundamental rights, principles of natural justice, or that the proceedings were without jurisdiction.
Gujarat High Court
Petition Under Section 34 Not Maintainable Against Rejection Of Application Under Section 16 By Arbitrator: Gujarat High Court
Case Title: Babasaheb Ambedkar Open University Versus Abhinav Knowledge Services Private Limited
LL Citation: 2024 LiveLaw (Guj) 97
The Gujarat High Court bench of Chief Justice Sunita Agarwal and Justice Aniruddha P. Mayee has held a petition under Section 34 of the Arbitration and Conciliation Act, 1996 is not maintainable against the order of rejection of the application under Section 16 challenging challenging the jurisdiction of an arbitrator on the plea of res judicata and bar under Order 2 Rule 2 CPC.
Himachal Pradesh High Court
Case Title: Kamla Devi vs Land Acquisition Officer-cum-Competent Authority and another
Case Number: Arbitration Case No.573 of 2024
The Himachal Pradesh High Court bench of Justice Bipin Chander Negi onus is upon the arbitrator to perform the task entrusted to them within the time schedule prescribed in Section 29A of the Arbitration and Conciliation Act, 1996. The bench noted that criticized an arbitrator appointed by Central Government under the National Highways Act for his callous attitude. The court noted that the arbitrator took upon the task of deciding the arbitration proceedings knowing fully well that if the proceedings are not completed within the time schedule, then unless the same is extended by a Court of Law, the mandate of the Arbitrator shall stands terminated.
Jammu And Kashmir High Court
Case Title: Ramtech Software Private Limited Vs Ut Of J&K And Another
Case Number: Arb P. No.41/2023
The Jammu and Kashmir High Court bench of Chief Justice N. Kotiswar Singh held that if a party didn't respond to the demands and requests made by the other party, it can't invoke the part of the arbitration clause that such disputes and differences shall be an endeavoured to be resolved by mutual negotiations as a condition precedent for invoking the arbitration clause.
Disputes Predominantly Civil But Involving Elements Of Criminality Not Automatically Excluded From Arbitration: Jammu and Kashmir High Court
Case Title: M/s Tata Power Solar vs UT of J&K and Ors.
Case Number: Arb P No. 36/2023
The Jammu and Kashmir High Court bench of Chief Justice N. Kotiswar Singh has held that a dispute predominantly civil but involving elements of criminality is not automatically excluded from arbitration.
The bench noted that unless there is a specific allegation of the parties engaging in an agreement amounting to criminal conspiracy, there should be no blanket prohibition on referring such disputes to arbitration.
Any attempt To Modify Award Under Section 34 is not permissible: J&K High Court
Case Title: UT of J&K Vs M/s Hindustan Constructions Co. Limited and others
Citation: 2024 LiveLaw (JKL) 203
The Jammu & Kashmir and Ladakh High Court has set aside a judgment from a subordinate court modifying an arbitral award while underscoring that under Section 34 of the J&K Arbitration and Conciliation Act, 1997, courts lack the authority to modify arbitral awards and can only either uphold or set aside the awards.
Jharkhand High Court:
Case Title: Tata Steel Utilities and Infrastructure Services Limited vs Jharkhand Urban Infrastructure Development Company Limited
LL Citation: 2024 LiveLaw (Jha) 106
The Jharkhand High Court bench of Acting Chief Justice Shree Chandrashekhar has held that in Section 11(6) of the Arbitration and Conciliation Act, 1996, the Court is required to see whether there is an arbitration clause which as per section 7 should be a document in writing signed by the parties. Furthermore, where the existence of the arbitration agreement is undisputed by the parties involved, the dispute should accordingly be referred to arbitration.
Karnataka High Court
Case Title: Mr. Shyamal Mukherjee Vs Pricewaterhousecoopers Services LLP
Citation No: 2024 LiveLaw (Kar) 303
The Karnataka High Court bench of Justice R. Devdas has held that prior involvement as an arbitrator in a dispute or multiple appointments by one of the parties or its affiliate does not automatically disqualify an individual from serving as an arbitrator in subsequent cases. The crucial factor lies in the arbitrator's ability to demonstrate independence and impartiality in past proceedings.
Ex-Parte Interim Measures Appealable Under Section 37 Of Arbitration Act, Courts Must Allow Appeal In Exceptional Cases: Karnataka High Court
Case Title: M/s KLR Group Enterprises vs Madhu HV and Ors.
Case No.: Commercial Appeal No. 56 OF 2024
The Karnataka High Court division bench of Justice Anu Sivaraman and Justice Anant Ramanath Hegde has held that ex-parte interim measures granted under Section 9 are appealable under Section 37 of the Arbitration and Conciliation Act, 1986. The High Court held that the nature of ex-parte interim measures is similar to final orders since they conclusively deny the relief sought. However, it held that the interference should be in exceptional cases since the aggrieved party can move to vacate the ex-parte order.
Lis Pendens Principle Applies To Property Acquired During Section 9 Arbitration Proceedings: Karnataka High Court
Case Title: M/s Devtree Corp. Llp. Vs M/s Bhumika North Gardenia
Case Number: MISCELLANEOUS FIRST APPEAL NO. 2978 OF 2024 (AA)
The Karnataka High Court bench of Justice Anu Sivaraman and Justice Anant Ramanath Hegde has held that an individual who acquires property that is the subject of a proceeding under Section 9 of the Arbitration and Conciliation Act, 1996, is subject to the principle of lis pendens.
The issue before the High Court was whether the transaction was affected by the principle of lis pendens as outlined in Section 52 of the Transfer of Property Act, 1882.
Non-Signatories Bound By Arbitration Clause When Purchasing Property From Agreement Parties: Karnataka High Court
Case Title: M/s Devtree Corp. Llp. Vs M/s Bhumika North Gardenia
Case Number: MISCELLANEOUS FIRST APPEAL NO. 2978 OF 2024 (AA)
The Karnataka High Court bench of Justice Anu Sivaraman and Justice Anant Ramanath Hegde has held that a person who is not a party to the arbitration agreement but buys property from someone who is a party to the agreement is still bound by the arbitration clause that applies to their vendors.
The High Court noted that the Constitution Bench of the Supreme Court decision in Cox and Kings Limited v. SAP India Private Limited and Another was primarily concerned with whether the phrase "claiming through or under" in Section 8 of the Arbitration Act includes the "Group of Companies" doctrine and whether this doctrine, as previously outlined in Chloro Controls India (P) Ltd. v. Severn Trent Water Purification Inc., constitutes valid law.
Settlement Arising From Contract Containing Arbitration Clause Must Be Resolved Through Arbitration: Karnataka High Court
Case Title: M/S Akshaya Private Limited Vs M/S S P Sai Technologies
Citation No: 2024 LiveLaw (Kar) 347
The Karnataka High Court division bench of Justice Anu Sivaraman and Justice Anant Ramanath Hegde has held that the right to enforce the settlement has to be through arbitration as the alleged settlement is in respect of a transaction arising from the contract which contained an arbitration clause.
Madras High Court
Unilateral Appointment Of Arbitrator & Non Service Of Notice : Madras High Court Sets Aside Arbitral Award
Case Title: Vipul Kumar Tulsian and anr vs M/s.Sundaram Finance Ltd
Citation: 2024 LiveLaw (Mad) 292
The Madras High Court bench of Justice Krishnan Ramasamy has set aside an arbitral award where the opposite party proceeded with arbitration unilaterally and appointed the Arbitrator without any intimation to the claimants. Further, the claimants neither received notices of hearing nor appeared before the Tribunal, and consequently, the Arbitrator did not afford any opportunity to claimants to contest the matter.
Formal Contract Signature Not Required To Enforce Arbitration Clause If Parties Are Ad Idem: Madras High Court
Case Title: Larsen & Toubro Limited vs M/s.Texmo Pipes and Products Limited
Citation: 2024 LiveLaw (Mad) 293
The Madras High Court division bench of Justice Krishnan Ramasamy has held that if it is proved that if it is established that the parties are ad idem, a formal contract signature by the other party is not necessary to enforce the arbitration agreement.
Further, the bench held that by acting upon the Purchase Orders, the party implicitly accepted the terms, including the arbitration clause contained in the GCC.
Telangana High Court
Case Title: M/S. Lignite Power Pvt. Ltd. vs M/S Totale Global Private Ltd
Case Number: ARBITRATION APPLICATION No.205 of 2023
The Telangana High Court bench of Justice B. Vijaysen Reddy held that the provisions of the MSMED Act, 2006 will prevail over the Arbitration and Conciliation Act, 1996. The bench held that even if parties have an arbitration agreement, if the seller falls under the purview of the MSMED, it has the right to seek resolution through the designated authority for its claims.
Telangana HC Explains Section 31(7)(A) And (B) Of The A&C Act,1996 In Terms Of Timeframes, Embargo & Discretion
Case Title: The Union Of India, Secbad And 3 Others vs M/S. Suntechno Constructions
Case Number: C.M.A.No.857 OF 2016
The Telangana High Court division bench of Justice Moushumi Bhattacharya and Justice M. G. Priyadarsini has held the arbitral tribunal has full authority to award interest from the date of the award until the date of payment, regardless of any contrary decision by the parties. If the award is silent on the rate of interest, the award holder is entitled to an interest rate 2% higher than the market rate.
Case Title: Sri Parvez Adi Debara vs M/s. Innovation Builders
Case Number: CIVIL MISCELLANEOUS APPEAL No.289 of 2023
The Telangana High Court bench of Justice P.Sam Koshy and Justice Sambasivarao Naidu has held the legal heirs of a deceased person who was a party to an arbitration agreement fall under the definition of "legal representative" as specified in Section 2(1)(g) of the Arbitration and Conciliation Act, 1996.
The bench held that it encompasses persons who manage or claim to inherit the deceased's estate.
Invoking Section 8(1) Of Arbitration And Conciliation Act, 1996, Formal Application Is Required, Averment In Written Statement Not Enough
Case Title: Yakkanti Adinarayana Reddy vs. Yakkanti Adinarayana Reddy
Case Number:C.R.P.NO.1516 OF 2024
The Telangana High Court has clarified the procedural requirements for invoking arbitration under Section 8(1) of the Arbitration and Conciliation Act, 1996. The court held that a formal application for referring parties to arbitration must be filed before submitting the first statement on the substance of the dispute, typically the written statement in a suit.
