Arbitrator Can Award Escalation For Employer-Caused Delay Without Contractual Clause: J&K High Court

On 29 August, the High Court of Jammu & Kashmir and Ladakh held that an Arbitrator can award escalation for delay attributable to the employer even when the contract does not contain a 'Price Escalation Clause'. Justice Shahzad Azeem upheld an arbitral award of Rs. 21.19 lakh in favour of a contractor, finding that the Arbitrator had based the escalation award on the Department's default in supplying construction material and supported the finding with evidence. The Bench held: “The...

Section 269SS Income Tax Act Breach Does Not Bar Section 138 NI Act Case: J&K High Court

The High Court of Jammu & Kashmir and Ladakh on 18 August held that violation of Section 269SS of the Income Tax Act does not render a transaction unenforceable under Section 138 of the Negotiable Instruments Act (NI Act), and attracts only the penalty prescribed under the Income Tax Act. Section 269SS of the Income Tax Act restricts the acceptance of certain loans, deposits and specified sums in cash. A Bench of Justice Shahzad Azeem dismissed two petitions filed by Manzoor Ahmad Khan...

J&K And Ladakh High Court Holds SIDCO MD Ineligible To Act As Arbitrator In Contract Dispute With UT

The High Court of Jammu & Kashmir and Ladakh on 21 August held that the Managing Director of J&K State Industrial Development Corporation (SIDCO) was ineligible to act as an arbitrator in a dispute between Abraq Infrastructures LLP and the Union Territory, as he was an employee of one of the respondents. Acting Chief Justice Sanjeev Kumar allowed Abraq Infrastructures LLP's petition under Section 11(6) of the Arbitration and Conciliation Act, 1996, and appointed a Retired District and...

Exercise Of Writ Jurisdiction Against Interlocutory Arbitral Orders Only In Exceptional Cases: J&K And Ladakh High Court

The High Court of Jammu & Kashmir and Ladakh has ruled that its writ jurisdiction should be exercised with exceptional restraint against interlocutory orders passed by an Arbitrator during ongoing proceedings.Explaining the limits on judicial intervention, Justice Sanjay Parihar observed, “The jurisdiction of this Court under Articles 226 and 227 undoubtedly survives, but its exercise against interlocutory arbitral orders is subject to exceptional restraint. Mere error of fact or law, or the...

J&K And Ladakh HC Holds Past Arbitration No Bar In Refund Claim, Directs SKUAST-J To Release Deposit

On 3 August, the Jammu & Kashmir and Ladakh High Court held that a contractor's claim for refund of earnest money and performance security cannot be rejected merely because it was not raised in earlier arbitration proceedings over delayed payments. A Bench of Justice Sanjay Parihar directed Sher-e-Kashmir University of Agricultural Sciences and Technology, Jammu to refund Rs. 29 lakh deposited by Construction Engineer for a boys' hostel project and held that the refund claim was not barred...

Jammu & Kashmir and Ladakh High Court Dismisses MSME Supplier's Writ, Cites MSMED Act Remedy

The Jammu & Kashmir and Ladakh High Court has ruled that it would ordinarily not exercise its writ jurisdiction under Article 226 where an MSME supplier has an equally efficacious statutory remedy under the Micro, Small, and Medium Enterprises Development Act, 2006 (MSMED Act). Dismissing a petition filed by a registered micro enterprise seeking recovery of alleged outstanding dues, the court held that no exceptional circumstances had been made out to justify bypassing the statutory...

GST Penalty Order Passed Beyond 7 Days Of Show Cause Notice Is Invalid: Jammu & Kashmir and Ladakh High Court

The Jammu & Kashmir and Ladakh High court has held that the seven-day timeline prescribed under Section 129(3) of the Jammu & Kashmir Goods and Services Tax Act, 2017 for passing a penalty order is mandatory. It ruled that a penalty order passed even a day beyond the statutory period cannot be sustained. A Division Bench of Acting Chief Justice Sanjeev Kumar and Justice Mohd Yousuf Wani observed that where the legislature has used the word "shall" while prescribing timelines for the...

Arbitration Can Be Revived Even After Arbitrator's Mandate Ends: Jammu & Kashmir & Ladakh High Court

The Jammu & Kashmir and Ladakh High Court has reiterated that even after an arbitrator's mandate terminates for failure to make an award within the statutory period, a court can revive the arbitral proceedings by extending the time, and such an application is maintainable even after the mandate has expired.Justice Sanjay Dhar made the observation while extending by two months the time for a sole arbitrator to make an award in a contractual dispute arising out of a street-lighting project on...

J&K High Court Quashes Coca-Cola Beverages Prosecution Over Pre-2018 Differential MRPs

On 3 July, the Jammu & Kashmir and Ladakh High Court held that manufacturers could lawfully declare different Maximum Retail Prices (MRPs) for identical packaged products before the 2017 amendment to the Legal Metrology (Packaged Commodities) Rules came into force. Justice Rajnesh Oswal allowed Hindustan Coca Cola Beverages Pvt. Ltd.'s petition and quashed a criminal complaint, the Magistrate's cognizance order and all consequential proceedings, holding that no offence arose because neither...

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...

J&K High Court Refers ₹34.88 Crore HRCC–ERA Dispute To Arbitration, Holds Non-Operational DRE No Bar

The Jammu & Kashmir and Ladakh High Court on 22 May held that the existence of a contractual pre-arbitration dispute resolution mechanism cannot defeat a party's right to invoke arbitration under Section 11(6) of the Arbitration and Conciliation Act, 1996, where such mechanism has not been operationalised. A Single-Judge Bench of Justice Sanjay Dhar appointed former Chief Justice of the High Court, Justice Ali Mohammad Magrey, as sole arbitrator to adjudicate disputes between Hassan Roads...

J&K and Ladakh High Court Rejects Arbitration Plea Against HPCL, Finds No Agreement In Ad Hoc Dealership

The Jammu & Kashmir and Ladakh High Court on 12 May dismissed a petition by Kanta Devi under Section 11(6) of the Arbitration and Conciliation Act, 1996, holding that no valid arbitration agreement existed in relation to an ad hoc petrol pump dealership governed through a temporary arrangement with Hindustan Petroleum Corporation Limited (HPCL).Justice Rajnesh Oswal held that applying operational terms of HPCL's Standard Dealership Agreement to a temporary arrangement did not amount to...