All Unilateral Appointments Are Not Invalid Unless The Appointed Arbitrator Falls Within 7th Schedule: Calcutta High Court

The High Court of Calcutta has held that all unilateral appointment of arbitrator are not invalid per se unless the arbitrator’s relationship falls within the Seventh Schedule to the A&C Act. The bench of Justice Moushumi Bhattacharya distinguished between an arbitration clause that permits unilateral appointment of arbitrator and a clause that provides for arbitration before some person in charge of one of the parties or right of that person to delegate his function to a third...

Arbitrator Who Accepted Brief Of Party’s Lawyer In An Unrelated Matter, No Clash of Interest Involved: Bombay High Court

The Bombay High Court has ruled that there is no clash of interest involved where the Arbitrator had acted as a counsel and represented the Advocate representing the opposite party, in another unrelated matter for some other client. The bench of Justice Bharati Dangre concluded that the disqualification connection, contemplated under Item 3 of Schedule VII of the Arbitration and Conciliation Act, 1996 (A&C Act), must be between the Arbitrator and the litigant. Thus, where the...

Clarification Sought By Arbitrator On Other Matters, Won’t Make Them Subject Of Arbitral Proceedings: Delhi High Court

The Delhi High Court has ruled that information and clarification sought by the Arbitral Tribunal on matters and dispute arising under other contracts, which do not form a part of the arbitral reference, will not alone make them the subject of arbitral proceedings. The bench of Justice Anup Jairam Bhambhani remarked that the letter issued by the Arbitrator, seeking information and clarification as to whether payments were released to the claimant under other contracts, which were not...

Arbitration Cases Weekly Round-Up: 5 February To 11 February, 2023

Bombay High Court: SPA Which Gives Option To Resell Shares To Vendor, Not A ‘Forward Contract’: Bombay High Court Case Title: Percept Finserve Pvt Ltd & Anr. versus Edelweiss Financial Services Ltd The Bombay High Court has ruled that a Share Purchase Agreement (SPA), which gives an option to the purchaser to require the seller/vendor to repurchase the shares on the occurrence of a contingency, does not constitute a ‘forward contract’ and thus, the same is enforceable. ...

Agreement To Explore Conciliation Before Arbitration, Only Directory In Nature: Delhi High Court

The Delhi High Court has ruled that the agreement between the parties to explore conciliation before resorting to arbitration, is not mandatory in nature. The Court took note that as per Section 77 of the Arbitration and Conciliation Act, 1996 (A&C Act), in cases of urgency, arbitral proceedings can be initiated even when conciliation proceedings are pending for preserving the party’s rights. The bench of Justice Navin Chawla remarked that in order to determine whether it is...

SPA Which Gives Option To Resell Shares To Vendor, Not A ‘Forward Contract’: Bombay High Court

The Bombay High Court has ruled that a Share Purchase Agreement (SPA), which gives an option to the purchaser to require the seller/vendor to repurchase the shares on the occurrence of a contingency, does not constitute a ‘forward contract’ and thus, the same is enforceable. The bench of Justices K. R. Shriram and Rajesh S. Patil, were dealing with an arbitral award, where the Arbitral Tribunal had ruled that the option contained in the SPA was unenforceable since it constituted a...

Arbitral Tribunal Not Justified In Dismissing Claim Petition For Not Being Verified As Per CPC: Gujarat High Court

The Gujarat High Court has ruled that failure to abide by the procedural laws would not be fatal to the arbitral proceedings and thus, the Arbitral Tribunal was not justified in dismissing the claim petition/ statement of claims solely on the ground that it was not verified as contemplated under Order VI Rule 15 of the Code of Civil Procedure, 1908 (CPC). The bench of Chief Justice Aravind Kumar and Justice Ashutosh Shastri held that in view of the High Court’s power of superintendence...

Delay In Approaching Appointing Authority For Constitution Of Tribunal, Won’t Render Claims Time Barred: Delhi High Court

The Delhi High Court has ruled that the limitation period within which a party is required to approach the court for seeking constitution of the arbitral tribunal, cannot be conflated with the limitation period for invoking the arbitration agreement. Thus, any delay by the party in taking further steps for constitution of an arbitral tribunal, will not render the party’s substantive claims as barred by limitation. The bench of Justices Vibhu Bakhru and Amit Mahajan also remarked that...

Sec 34 Petition Is Not Non-Est, Even If Award Is Not Filed In A Separate Folder: Delhi High Court

The Delhi High Court has ruled that the error committed by the petitioner/award debtor in not filing the documents, including the copy of the Arbitral Award challenged by it, in a separate e-folder, as prescribed in the Delhi High Court (Original Side) Rules, 2018, would not render the petition filed by it under Section 34 of the Arbitration and Conciliation Act, 1996 (A&C Act) as non-est. The bench of Justice Navin Chawla remarked that a more liberal approach must be adopted by the...

Order Passed Under S. 36 Of Arbitration Act Not Appealable Under S. 13 Of Commercial Courts Act: Delhi High Court

The Delhi High Court has ruled that appeal against the order of the High Court, passed under Section 36 of the Arbitration and Conciliation Act, 1996 (A&C Act), is not maintainable under Section 13(1A) of the Commercial Courts Act, 2015, since it is not one of the orders enumerated under Order XLIII of the Code of Civil Procedure, 1908 (CPC), from which an appeal would lie. The bench of Justices Vibhu Bakhru and Amit Mahajan observed that in view of the proviso to Section 13(1A),...

Arbitration Cases Weekly Round-Up: 29 January To 4 February, 2023

Bombay High Court: Court Not Powerless To Appoint Appropriate Arbitral Tribunal, Even If Party Forfeits Its Right Under Arbitration Clause: Bombay High Court Case Title: PSP Projects Limited versus Bhiwandi Nizampur City Municipal Corp The Bombay High Court has ruled that even if a party’s right to appoint its nominee in the Arbitral Tribunal as per the arbitration clause, is forfeited because it failed to exercise its right within the statutory period after receiving the notice ...

Arbitration Cases Monthly Round-Up: January 2023

Supreme Court: Starting Point Of Limitation U/ Section 34(3) Arbitration Act In Cases Of Suo Motu Correction Of Award: Supreme Court Explains Case Title: USS Alliance versus State of Uttar Pradesh The Supreme Court has observed that the starting point for the limitation under Section 34(3) Arbitration and Conciliation Act, in case of suo moto correction of the award, would be the date on which the correction was made and the corrected award is received by the party. Once the...