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Arbitration Cases Weekly Round-Up: 28 August To 3 September, 2022
Parina Katyal
4 Sept 2022 1:30 PM IST
Bombay High Court: Notice Under Section 21 Of A&C Act Issued; Court Not Barred From Exercising Jurisdiction Under Section 9: Bombay High Court Case Title: Relcon Infroprojects Ltd. & Anr. versus Ridhi Sidhi Sadan, Unit of Shree Ridhi Co.op. Housing Society Ltd. & Ors The Bombay High Court has ruled that merely because a notice under Section 21 of the...
Bombay High Court:
Case Title: Relcon Infroprojects Ltd. & Anr. versus Ridhi Sidhi Sadan, Unit of Shree Ridhi Co.op. Housing Society Ltd. & Ors
The Bombay High Court has ruled that merely because a notice under Section 21 of the Arbitration and Conciliation Act, 1996 (A&C Act) to refer the disputes to arbitration is issued by a party, the Court is not barred from exercising jurisdiction under Section 9 of the A&C Act for interim measures.
The Court added that it is not constrained to refer the parties to arbitration and convert the proceedings under Section 9 into an application under Section 17 of the A&C Act, to be adjudicated by the arbitral tribunal.
Case Title : USP Studios Pvt. Ltd. versus Ganpati Enterprises & Ors
Observing that a judicial authority must make a reference to arbitration if even a semblance of dispute exists between two parties who have an arbitration agreement, the Bombay High Court has held that impliedly admitted liability cannot prevent reference of dispute to arbitration.
Calcutta High Court:
Arbitral Award With Contradictory Findings Is Liable To Be Set Aside: Calcutta High Court
Case Title: State of West Bengal versus Tapas Kumar Hazra
The High Court of Calcutta has held that an arbitral award wherein the arbitrator has given contradictory findings is liable to be set aside.
The Bench of Justice Krishna Rao reiterated that an arbitral award wherein no reasons are given for arriving at a particular finding is also liable to be set aside.
Delhi High Court:
Case Title: Geeta Poddar versus Satya Developers Pvt. Ltd.
The High Court of Delhi has held that an award passed by a unilaterally appointed arbitrator is non-est, therefore, it cannot be a bar to the maintainability of a petition under Section 11 of the A&C Act.
The bench of Justice Sanjeev Narula held that passing of an award would not give sanctity to the non-est proceedings and the mere fact that the petitioner did not challenge the unilateral appointment under Section 14 of the Act cannot deprive it of the right to approach the court for appointment of independent arbitrator.
Case Title: BOLT Technology OU versus Ujoy Technology Pvt. Ltd.
The High Court of Delhi has held that when the plaintiff makes an offer to the defendant to amicably settle the dispute and the defendant refuses the offer then in that circumstance, the requirement of pre-litigation meditation stands satisfied.
The Bench of Justice Prathiba M. Singh while reiterating that pre-litigation mediation as provided under Section 12-A of the CCA is a mandatory provision, held that the conduct of the defendant in refusing to amicably settle the dispute violates the spirit of Section 12A of CCA, therefore, he cannot turn around and object on the ground of non-compliance with the requirement.
Case Title: Royal Orchids versus Kulbir Singh Kohli & Anr.
The Delhi High Court has ruled that a MOU which is in the nature of a commercial transaction between two private parties is by its very nature determinable and hence, the said MOU can be terminated even in the absence of any termination clause contained in it.
The Single Bench of Justice Mini Pushkarna held that since the MOU was not capable of specific performance due to the statutory bar contained in Section 14 (d) of the Specific Relief Act, 1963, the party was not entitled to any interim relief under Section 9 of the Arbitration and Conciliation Act, 1996 (A&C Act).
Case Title: Antrix Corporation Ltd. versus Devas Multimedia Private Limited
Citation: 2022 LiveLaw (Del) 812
The Delhi High Court has set aside a 2015 arbitral award directing Antrix Corporation Limited, commercial and marketing arm of ISRO, to pay US$ 562.2 million to Devas Multimedia Private Limited over wrongful repudiation of contract.
Justice Sanjeev Sachdeva held that the arbitral award dated September 14, 2015 suffered from patent illegalities and fraud and was also in conflict with the Public Policy of India.
Jammu and Kashmir High Court:
Case Title: Anita Mehta versus Gulkand Hues Pvt. Ltd.
The Jammu and Kashmir and Ladakh High Court has held that an application for rejection of a plaint cannot be considered to be the first statement on the substance of the dispute as it is merely an incidental procedural proceeding.
The Bench of Chief Justice Pankaj Mithal held that mere filing of an application for rejection of plaint would not debar a party from subsequently filing an application under Section 8 of the A&C Act as the party cannot be presumed to have given up on its right to arbitration. Similarly, it cannot preclude the party from filing an application for appointment of arbitrator.
Madras High Court:
Case Title: M/s. Sunwin Papers versus M/s. Sivadarshini Papers Pvt. Ltd.
Citation: 2022 LiveLaw (Mad) 383
The Madras High Court has ruled that if an order passed by the Arbitral Tribunal under Section 16 of the Arbitration and Conciliation Act, 1996 (A&C Act), of ruling on its own jurisdiction, has the effect of concluding the arbitral proceedings, the same would be challengeable under Section 34 of the A&C Act.
The Single Bench of Justice M. Sundar held that since registration under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act) is not compulsory, the order passed by the Arbitral Tribunal accepting the plea of lack of jurisdiction due to the non-registration of the claimant under the MSMED Act, is patently illegal and in conflict with the public policy of India.
Section8 Of A&C Act Falls Outside The Scope Of Section 42: Madras High Court Reiterates
Case Title: K. Samad & Anr. versus Reliance Capital Limited
The Madras High Court has reiterated that Section 8 of the Arbitration and Conciliation Act, 1996 (A&C Act) is an exception to Section 42 of the A&C Act. The Court added that if Section 8 is also brought within the ambit of Section 42, it would defeat the sublime philosophy underlining arbitration i.e., party autonomy.
The Single Bench of Justice M. Sundar ruled that a party has no choice of jurisdiction while filing a Section 8 application, and that it is a Hobson's choice for it since it is constrained to file an application under Section 8 in the Civil Court where the civil suit has been filed by the opposite party.
Patna High Court:
Case Title: The Bihar State Text Book Publishing Corporation Ltd. versus M/s Patna Offset Press
The Patna High Court has ruled that the order passed by the High Court in a writ petition, recording the consent of the parties to appoint a specified Arbitrator while referring them to arbitration under Section 8 of the Arbitration and Conciliation Act, 1996 (A&C Act), cannot be said to be an order appointing an Arbitrator.
The Single Bench of Chief Justice Sanjay Karol held that once the party has filed an application under Section 14 of the A&C Act, to decide on the termination of the mandate of the arbitrator, the only remedy available to the party was to assail the order passed on the said application and thus, the petition under Section 11(6) of the A&C Act seeking appointment of an arbitrator would be barred by res judicata.
