Pending Suit Dispute Could Be Referred To Arbitration Only Through Court Under 1940 Act: Supreme Court

The Supreme Court on Friday held that under the now-repealed Arbitration Act, 1940, parties to a pending civil suit could not validly refer their dispute to arbitration without jointly approaching the court where the suit was pending for a reference. The court consequently decreed a suit for possession and mesne profits concerning a property in Gwalior and set aside a Madhya Pradesh High Court judgment that had upheld dismissal of the suit. A bench of Justices J.K. Maheshwari and Atul...

J&K and Ladakh High Court Dismisses Union's Challenge to Award In Army Northern Command Accommodation Project Dispute

The Jammu & Kashmir and Ladakh High Court has dismissed the Union of India's appeal against an order refusing to set aside an arbitral award after finding that it had failed to plead, point out or prove any perversity in the award. A Division Bench of Justice Rajnesh Oswal and Justice Rahul Bharti observed: "We find ourselves in cordial and in complete agreement with the court of learned Principal District Judge, Udhampur that the appellant failed to plead and point much less prove any...

Arbitration Clause in Tax Invoices Can Bind Parties if Accepted Through Conduct: Allahabad High Court

The Allahabad High Court has reiterated that an arbitration clause contained in tax invoices can constitute a binding arbitration agreement where the parties intended to be governed by it, while appointing a sole arbitrator to resolve a payment dispute arising from the supply of recycled polyester staple fiber. Justice Piyush Agrawal passed the order on an application filed by Ganesha Ecosphere seeking appointment of an arbitrator in a dispute arising from the supply of recycled polyester...

After Corporate Veil Was Lifted, Delhi HC Lets Directors Raise Company's Objections To Arbitral Award

The Delhi High Court has held that directors of International Print O Pac Ltd., against whom execution proceedings were initiated after the corporate veil of the company was lifted, can raise all objections available to the company, including a plea that the arbitral award sought to be enforced is a nullity. A Division Bench of Justice Dinesh Mehta and Justice Vinod Kumar set aside a Saket Commercial Court order rejecting objections filed by directors Amila Singhvi and another against...

Rajasthan HC Slams “Lethargic” Arbitration In ₹528 HCL–DISCOMs Dispute, Orders Fast-Track Completion

The Rajasthan High Court on 27 May held that arbitral proceedings must remain aligned with the statutory objective of expedition, efficiency, and cost-effectiveness under the Arbitration and Conciliation Act, 1996, and that procedural delay cannot justify repeated extensions of an arbitral tribunal's mandate under Section 29A. Justice Sameer Jain, invoking former Chief Justice of India Justice P.N. Bhagwati's observation that “Procedure is but a means to an end, not an end in itself”, partly...

Himachal Pradesh HC Directs Mahindra To Restore DMS Access Of Ex- Authorised Service Centre Pending Arbitration

The Himachal Pradesh High Court has granted interim relief to Naveen Auto Store Sole Proprietary, a Mahindra-authorised service centre operator, and directed Mahindra & Mahindra Ltd. to restore the dealer management system (DMS) access of its workshop. The Court held that the petitioner had made out a prima facie case for interim protection pending arbitration proceedings. Justice Romesh Verma observed, “The petitioner has been able to demonstrate on record that huge investment including...

Remedy Against Refusal To Recall Arbitral Termination Lies Under Section 14(2), Not Section 34: Delhi HC

The Delhi High Court has held that a party cannot invoke Section 34 of the Arbitration and Conciliation Act, 1996 to challenge an order refusing to recall termination of arbitral proceedings passed under Section 25, and that the only remedy lies under Section 14(2) of the Act. A Bench of Justices C. Hari Shankar and Om Prakash dismissed the appeal filed by U.P. Infraestate Pvt. Ltd. against Rivaj Infratech Pvt. Ltd., holding that the Section 34 petition itself was not maintainable. The judges...

Section 9 Of Arbitration Act Limited To Interim Protection, Not Merits: Kerala High Court

The Kerala High Court on 26 May held that courts exercising jurisdiction under Section 9 of the Arbitration and Conciliation Act, 1996 cannot adjudicate the merits of the underlying dispute while granting interim protection pending arbitration, as their power is confined to preserving the subject matter and granting protective relief. Justice S. Manu allowed the appeal and set aside the order passed by the Vacation Court, holding that it had exceeded the limits of Section 9 jurisdiction by...

“Every Day's Delay” Rule Not Pedantic, Bureaucratic Delay May Be Condoned: Himachal Pradesh High Court

The Himachal Pradesh High Court on 22 May held that Courts must adopt a common-sense approach while considering delay condonation applications filed by government authorities under Section 34 of the Arbitration and Conciliation Act, 1996, and that bureaucratic decision-making processes may constitute sufficient cause where the explanation is bona fide. A Division Bench comprising Chief Justice Gurmeet Singh Sandhawalia and Justice Bipin Chander Negi allowed the appeal filed by the State of...

Delhi High Court Refers 'Intertwined' Builder JV, Settlement And Mortgage Deed Disputes To Arbitration Without Fresh Notice

The Delhi High Court has referred to arbitration a fresh round of disputes between Jiangxi Construction Engineering Group Co. Ltd. and Varaha Infra Ltd., holding that claims arising from their joint venture agreements, settlement arrangement, consent arbitral award and mortgage deeds were too closely connected to be separated. Justice Mini Pushkarna appointed former Delhi High Court judge Justice (Retd.) Jayant Nath as sole arbitrator to adjudicate the disputes between the parties. The court...

Courts Must Call For Arbitral Records Before Deciding Challenge To Arbitral Award: Sikkim High Court

The Sikkim High Court has reiterated that a court hearing a challenge to an arbitral award cannot decide the matter without first calling for the records of the arbitral tribunal. A Division Bench of Chief Justice A. Muhamed Mustaque and Justice Bhaskar Raj Pradhan observed: “The Court entertaining the application under Section 34 is required, imperatively, to look into the records of the Arbitral Tribunal to satisfy whether any grounds under Section 34 have been made out or not. Without...

Winding Up Of Company Will Not Automatically Stay Arbitral Proceedings Against Promoters: Kerala High Court

The Kerala High Court has held that a company's winding up does not automatically halt arbitral proceedings or shield its promoters from contractual obligations undertaken in their personal capacity. Justice T.R. Ravi held, “Sections 278 and 279 of the Companies Act can have operation only with regard to claims against the Company and a winding up order will not automatically operate as a stay of further proceedings before the Arbitrator. ” It added, "The petitioner sought to place reliance on...