Supreme Court Refuses To Interfere With Arbitrator Appointment In Nissan Dealership Dispute
Kirit Singhania
8 Jun 2026 11:35 AM IST
The Supreme Court on Monday refused to interfere with a Punjab and Haryana High Court order appointing an arbitrator to resolve disputes between Vision Plus Financial Services (Vision Datsun) and Nissan Motor India Pvt Ltd arising out of a dealership agreement.
A bench of Justices Manmohan and Vijay Bishnoi declined to entertain Nissan Motor India's challenge to the March 9, 2026, order by which the High Court appointed former Punjab and Haryana High Court judge Justice Pramjeet Singh Dhaliwal as the sole arbitrator.
Appearing for Nissan Motor India, counsel argued that the High Court erred in referring the dispute to arbitration. It was submitted that the claims arose from the termination of a dealership agreement and were ex facie barred by limitation.
The company also objected to the appointment of a Chandigarh-based arbitrator. According to Nissan, Gurugram had been designated as the seat of arbitration under the agreement.
The Supreme Court, however, declined to interfere at this stage. The bench observed that where a claim is demonstrably time-barred, the issue can be examined at the referral stage. However, it was not inclined to interfere with the High Court's order in the present case.
On the objection regarding the arbitral seat, the Court said the parties could raise their grievances before the arbitrator. It clarified that all rights and contentions would remain open.
Background
The dispute arose after Vision Plus invoked the arbitration clause contained in the dealership agreement by issuing a notice on August 28, 2025. Alleging that Nissan failed to respond to the notice and disputes had arisen regarding the parties rights and obligations under the agreement, the dealer approached the High Court under Section 11(6) of the Arbitration and Conciliation Act seeking appointment of an arbitrator.
Before the High Court, Nissan had not disputed the existence of the dealership agreement or the arbitration clause. Its principal objection was that the claims raised by Vision Plus were barred by limitation and therefore non-arbitrable.
The High Court rejected the contention holding that at the stage of deciding a Section 11 petition, the court's enquiry is confined to the prima facie existence of an arbitration agreement.
Relying on the Supreme Court's decisions in SBI General Insurance Company Ltd. v. Krish Spinning and In Re: Interplay Between Arbitration Agreements and the Stamp Act, the High Court held that issues such as limitation are matters for the arbitral tribunal to decide.
Holding that the requirements for appointment of an arbitrator stood satisfied, the High Court allowed the petition and referred the parties to arbitration.
The Supreme Court has now declined to interfere with that order, leaving all objections open to be raised before the arbitral tribunal.