Delhi High Court Refuses To Recall Arbitrator Appointment In Vedanta–Gujarat State Petroleum Corporation Dispute

The Delhi High Court has rejected Gujarat State Petroleum Corporation Ltd.'s claim that it lacked jurisdiction to appoint an arbitrator in its dispute with Vedanta Limited, after GSPC argued that a foreign joint venture partner had been deliberately left out of the proceedings.

Justice Subramonium Prasad held that the jurisdictional objection, which was raised through a recall application, could not be examined at this stage because the arbitral tribunal is still considering whether Vedanta's joint venture partners, including Cairn Energy Hydrocarbons Limited and ONGC, are necessary parties to the arbitration.

“In case the learned Arbitral Tribunal rejects the said Application, then the entire issue that is now sought to be raised before this Court becomes redundant. Therefore, the present Application, at this juncture, seems to be premature.”

The dispute relates to gas sales from an oil and gas block in Rajasthan, which was awarded to a joint venture comprising Vedanta, ONGC and CEHL. Vedanta, as operator of the block, issued a notice inviting offers for the sale of gas. GSPC emerged as the largest buyer but later disputed the existence of a binding gas sales agreement. After settlement talks failed, Vedanta invoked arbitration. When GSPC did not nominate an arbitrator, Vedanta approached the High Court under Section 11 of the Arbitration and Conciliation Act.

In July 2025, the court appointed former Supreme Court judge Justice Ravinder P. Bhatt as GSPC's nominee arbitrator.

GSPC sought recall of that order, contending that Vedanta had failed to implead ONGC and CEHL despite them being joint venture partners. It argued that since CEHL is a foreign entity, the dispute would amount to an international commercial arbitration.

On that basis, GSPC said only the Supreme Court had jurisdiction to appoint an arbitrator and that the High Court's July 2025 order was a nullity.

The Court noted that GSPC had already challenged the appointment before the Supreme Court. The apex court declined to interfere and held that at the stage of appointing an arbitrator, the court is required only to examine, on a prima facie basis, whether an arbitration agreement exists. It expressly left all questions relating to arbitrability and jurisdiction open.

“All these questions can be raised by the Respondent before the learned Arbitral Tribunal by filing an application under Section 16(1) of the Arbitration Act,” the High Court said, adding that it would be for the tribunal to decide whether the arbitration qualifies as an international commercial arbitration.

The Court also dismissed a separate application seeking modification of its direction on arbitrators' fees. While the arbitral tribunal proposed adoption of the Delhi International Arbitration Centre's fee schedule, GSPC declined to consent.

The court said it lacked jurisdiction to alter the fee structure fixed in its earlier order without mutual consent.

“Without the consent of the Respondent, this Court will not have the jurisdiction to alter Paragraph No.33 of the Judgment dated 28.07.2025. The Respondent is correct in stating that it cannot be said that there is any error apparent on the face of the record in the Judgment dated 28.07.2025,” Justice Prasad held.

The court concluded that GSPC had failed to show any error apparent on the face of the record warranting recall or modification of the July 2025 order.