Arbitration Weekly Round-Up: 25th March to 31st March 2024
ausaf ayyub
31 March 2024 9:15 PM IST
Supreme Court Enforcement Of Foreign Award Must Be Refused Only Rarely, International Standards To Be Applied To Determine Bias : Supreme Court Case Title: AVITEL POST STUDIOZ LIMITED & ORS. v. HSBC PI HOLDINGS (MAURITIUS) LIMITED., Citation: 2024 LiveLaw (SC )267 In a crucial judgment, while allowing the enforcement of a foreign arbitral award, the Supreme Court...
Supreme Court
Case Title: AVITEL POST STUDIOZ LIMITED & ORS. v. HSBC PI HOLDINGS (MAURITIUS) LIMITED.,
Citation: 2024 LiveLaw (SC )267
In a crucial judgment, while allowing the enforcement of a foreign arbitral award, the Supreme Court (on March 04), held that to determine the factor of arbitral bias, Court must endeavour to follow international standards than domestic ones. It is only in exceptional circumstances that enforcement of a foreign should be refused on the ground of bias the Court said.
"Embracing international standards in arbitration would foster trust, certainty, and effectiveness in the resolution of disputes on a global scale. The above discussion would persuade us to say that in India, we must adopt an internationally recognized narrow standard of public policy, when dealing with the aspect of bias"
High Courts
Allahabad High Court
Case Title: The Public Works Department Thru. Chief Engineer vs Pnc Infratech Limited Thru. Authorized Signatory.
Case Number: Civil Misc. Review Application Defective No. 16 of 2024
The Allahabad High Court single bench of Justice Jaspreet Singh held that questions of implications of agreements, Section 64 of the Contract Act, whether the disputes relate to the construction stage or implications of legal provisions of National Highways Act, 1956 need to be decided by the arbitral tribunal. It held that the scope of the review jurisdiction is narrow and limited to ascertain an error apparent on the face of the record.
Bombay High Court
The Bombay High Court single bench of Justice R.I. Chagla stayed an arbitral award noting that the Arbitrator contravened the settled law that for a claim for damages, there must be proof of actual loss which is sine qua non for such claim. It held that the Arbitrator failed to consider the proof of loss while awarding damages to the Claimant.
Calcutta High Court
Case Title: Tree House Education And Accessories Ltd. Versus Holy Trust School
Case Number: AP/24/2024
The Calcutta High Court single bench of Justice Moushumi Bhattacharya held that it would be an unnatural construction of Section 11 of the Arbitration and Conciliation Act, 1996 where a party with a bona fide and a genuine claim is left in the lurch on the defence of the claim being barred by limitation. It held that when parties engage in constant communication for the settlement of claims, it would be unjust to dismiss a claim solely on the grounds of being time-barred.
Delhi High Court
Case Title: Techno Compact Builders v. Railtel Corporation of India Limited
Citation: 2024 LiveLaw (Del) 360
The High Cout of Delhi has held that a panel consisting of 23 names cannot be considered broad-based if lacks arbitrators from different backgrounds.
The bench of Justice Dinesh Kumar Sharma held that a panel must not only be broad in terms of numbers but should also reflect diversity by having arbitrators from diverse backgrounds.
Case Title: Rani Construction v. Union of India
Citation: 2024 LiveLaw (Del) 361
The High Court of Delhi has held the membership of an arbitral institution cannot be insisted upon as a pre-requisite for invoking arbitration.
The bench of Justice Sachin Datta held that when parties agree to resolve their dispute through an arbitral institution, such an agreement cannot be construed to mean that they have agreed to take its membership.
The Court held that insistence by an arbitral institution for such membership impinges on the validity of the appointment procedure and amounts to failure to perform the function entrusted to such institution. It held that in such a situation the appointment would be made by the Court under Section 11(6) of the A&C Act.
Case Title: Dharamvir & Company v. DDA
Citation: 2024 LiveLaw (Del) 362
The High Court of Delhi has held that merely because the delay in the execution of the work is attributable to the employer, the same would not entitle the contractor to claim damages unless it pleads and proves that such delay resulted in loss to it.
The bench of Justices Vibhu Bakhru and Tara Vitasta Ganju held that a procedural order passed by the earlier arbitrator, not being a final decision on the merits, does not preclude the substitute arbitrator from deciding the claims on their merits. It held that an order cannot be treated as an interim award when the issue was left to be decided on the merits at a later stage.
Delhi High Court Directs Arbitrator To Refund 6 Lakh Of 14.5 Lakh Fee Paid By Parties
Case Title: Smt. Manju Gupta & Ors. Vs Shri Vilas Gupta & Ors
Citation: 2024 LiveLaw (Del) 383
The Delhi High Court single bench of Justice Prathiba M. Singh directed the arbitrator to refund Rs.6,00,000- of the fees of Rs.14,50,000/- paid by the parties to the arbitrator noting the arbitrator had conducted a total of twelve hearings, of which only three resulted in substantive orders. Moreover, the bench noted that the issues in the arbitral proceedings had not yet been framed, and the arbitral proceedings had been on hold for over a year.
Case Title: Department Of Transport Govt Of Nct Of Delhi Vs Green City Transport Corporation Pvt Ltd
Citation: 2024 LiveLaw (Del) 376
The Delhi High Court single bench of Justice Dinesh Kumar Sharma held that not every defect leads to the dismissal of a petition under Section 34 of the Arbitration and Conciliation Act, 1996 and took a liberal approach for condonation of delay. It held that defects were not fundamental in nature and could be termed as curable or procedural.
Case Title: M/S Delhi Msw Solutions Limited vs Amity Software Systems Limited
Citation: 2024 LiveLaw (Del) 382
The Delhi High Court division bench of Justice Vibhu Bakhru and Justice Tara Vitasta Ganju rejected an application for condonation of delay of 191 days for petition filed under Section 37 of the Arbitration and Conciliation Act, 1996. It held that explanation provided for the delay was sketchy and did not corelate any event to specific dates or time period.
Case Title: Fusionnet Web Services v. Yash Fiber Network
Citation: 2024 LiveLaw (Del) 381
The Delhi High Court single bench of Justice Jasmeet Singh held that a mere franchisee responsible for promotion of services provided by the petitioner, ergo, it does not fall under the definitions of licensee, licensor, service provider, or group of consumers as per the TRAI Act. It held that bar under Section 14 only applies in relation to telecommunication services and not to every agreement involving a service provider.
Case Title: Oriel Financial Solutions v. Bestech Advisors Pvt Ltd
Citation: 2024 LiveLaw (Del) 380
The High Court of Delhi has held that an order of the arbitral tribunal rejecting an application challenging its jurisdiction under Section 16 of the A&C Act cannot be challenged in a writ petition unless the order is so perverse that it shocks the conscience of the Court.
The bench of Justice Subramonium Prasad reiterated that to protect the sanctity of the arbitral process, the Courts would not ordinarily interfere with an order of the arbitral tribunal in exercise of their writ jurisdiction.
Case Title: Nbcc India Ltd Vs Micro Small And Medium Enterprises Facilitation Council & Anr.
Citation: 2024 LiveLaw (Del) 379
The Delhi High Court single bench of Justice Subramonium Prasad held that a service supplier, upon registering during an ongoing contract, is eligible to avail benefits under the MSMED Act for services provided after registration. It held that it is always open to the arbitrator to decide this issue even as a preliminary issue.
Case Title: Vijay Kumar Mishra Construction Pvt. Ltd. Through Its Director Vijay Kumar Mishra vs The Oriental Insurance Co. Ltd
Citation: 2024 LiveLaw (Del) 378
The Delhi High Court single bench of Justice Jasmeet Singh dismissed the application filed under Section 11 of the Arbitration and Conciliation Act, 1996 and held that such a petition should be filed at the place of the subordinate office of the corporation.
“In the present case as well, the subordinate office of the respondent is situated at Satna, Madhya Pradesh and for the said reason, the State of Madhya Pradesh will have the jurisdiction to entertain and try the present petition under Section 11 of the Arbitration and Conciliation Act, 1996.”
Case Title: Psa Protech And Infralogistics Pvt. Ltd. Vs Food Corporation Of India
Citation: 2024 LiveLaw (Del) 377
The Delhi High Court single bench of Justice Jasmeet Singh held that the application under Section 29A of the Arbitration and Conciliation Act, 1996 can be allowed even after the expiry of the mandate of the Arbitral Tribunal.
Section 29A deals with the time limit for arbitral award. It specifies that the award shall be made within a period of twelve months from the date the arbitral tribunal enters upon the reference. However, parties may extend this period by mutual consent for up to six months. If the award is not made within this time frame, the mandate of the arbitral tribunal shall terminate unless the Court has extended the time period.
Gauhati High Court
Case Title: Bhartia Dooars (JV) And 2 Ors Vs Union Of India And 3 Ors.
Case Number: Arb.P./5/2023
The Gauhati High Court single bench of Justice Michael Zothankhuma held the personnel who is the employee of the Indian Railways cannot be appointed as an arbitrator as it would violate Section 12(1) of the Arbitration and Conciliation Act, 1996 and the law laid down in Perkins Eastman Architects DPC & Anr. Vs. HSCC (India) Ltd.
Gujarat High Court
The Gujarat High Court division bench of Chief Justice Sunita Agarwal and Justice Aniruddha P Mayee dismissed appeal under Section 37 of the Arbitration and Conciliation Act, 1996 noting that arbitrator's finding was based upon the proper appreciation and interpretation of the prevalent conditions and the site inspection along with the documents on record.
Karnataka High Court
Case Title: M/S. Mvr Constructions Vs M/S. V.M.R Constructions And Others.
Case Number: WRIT PETITION NO. 4604 OF 2018 (GM-CPC)
The Karnataka High Court single bench of Justice M G Uma held that the parties not signatories to the Joint Venture Agreement, stipulating the arbitration clause, cannot be forced to arbitration proceedings.
Case Title: M/s Bellary Nirmithi Kendra v. M/s Capital Metal Industries, CRP No. 100067 of 2022
The High Court of Karnataka has held that Section 47 of the CPC does not apply to proceedings for enforcement of arbitral award.
The bench of Justice C.M. Poonacha held that an arbitral award can only be challenged on the grounds mentioned under Section 34 of the Act and not otherwise. It held that the award is deemed to be a decree for the purpose of the enforcement, however, this deeming fiction is limited to its enforcement only.
Case Title: M/S Durga Projects Inc Vs Sri. B.G. Babu Reddy
Case Number: Criminal Appeal No.434 Of 2014 (A) C/W Criminal Appeal No.433 Of 2014 (A)
The Karnataka High Court single bench of Justice Anil B Katti held that simultaneous proceedings can be carried on under the Arbitration and Conciliation Act, 1996 and Section 138 of the Negotiable Instruments Act. The bench further held that a party cannot be acquitted solely on the basis of presence of an arbitration agreement.
Kerala High Court
Case Title: Rkec Projects Limited Vs The Cochin Port Trust, The Office Of Chief Engineer And Another.
Case Number: IA.NO.1/2023 IN AR NO. 53 OF 2019
The Kerala High Court single bench of Justice Anu Sivaraman held that the Court would be empowered to extend the time for passing the award under Section 29A of the Arbitration and Conciliation Act, 1996 even in a case where the arbitral award has already been passed if there exit sufficient grounds for such an extension.
Punjab & Haryana High Court
Case Title: M/S Dharam Pal Maddar And Sons Vs Union Of India Through Senior D.E.N. Iii Drm Office Northern Railway, Ferozepur.
Case Number: RA-CR-204-CII-2018 IN/AND ARB-222-2016 (O&M).
The Punjab and Haryana High Court single bench of Justice Vinod S. Bhardwaj held that notice for appointment of an Arbitrator was not necessarily required to be addressed to the General Manager of the Railways. Notice to invoke arbitration was said to be fulfilled as it was sent by a registered post to the Railways.
