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The petitioner submitted that it filed an arbitration petition before Punjab and Haryana High Court, as part of the agreement was executed at Chandigarh. However, the Punjab and Haryana High Court was unable to decide the petition due to territorial bar. Hence, the present petition is filed.
“Once the mechanism under MSME Act is triggered by any party, the procedure has to be taken to its logical end. However, once there is no trigger by invoking the jurisdiction of the Council, party cannot be precluded from resorting to any other mechanism for resolution of its disputes.”
“The agreement executed between the parties is not disputed. This fact is not in dispute that the contract of the petitioner has been terminated and the money has been forfeited by the respondents in the month of October, 2019.”
The arbitration would take place under the aegis of the Delhi International Arbitration Centre and would abide by its rules and regulations.
Supreme Court clarified that the limited jurisdiction of the referral Courts under Section 11 must not be misused by parties in order to force other parties to the arbitration agreement to participate in a time-consuming and costly arbitration process.
by Vasanth Rajasekaran* and Harshvardhan Korada**
“We have not expressed any opinion on the merits of the claim of either party including regarding the arbitrability of the dispute. All contentions and pleas are kept open for the parties to raise before the arbitral tribunal.”
The Arbitration and Conciliation Act, 1996 does not prohibit Public Sector Undertakings from empanelling potential arbitrators, however, an arbitration clause cannot mandate the other party to select its arbitrator from the panel curated by PSUs.
“Section 29A intends to ensure the timely completion of arbitral proceedings while allowing Courts the flexibility to grant extensions when warranted. Prescribing a limitation period, unless clearly stated in words or necessary, should not be accepted. Bar by limitation has penal and fatal consequences.”
A quick recap of the latest rulings on Arbitration Law by the High Courts.
by Vasanth Rajasekaran* and Harshvardhan Korada**
The respondent raised an objection to the maintainability of the present application on the ground that the petitioner being an agent governed under Section 48 of the Bihar Cooperative Societies Act, 1935, was required to approach the Registrar of the Cooperative Societies for initiating a dispute resolution proceeding.
The clear ineligibility to any unilateral appointment is set out in Section 12 of the Arbitration Act read with the Seventh Schedule of the Act. After the 2015 Amendment to the Act came into effect, any unilateral appointment would be contrary to the law.
“The arbitral proceedings in the matter were not terminated but the Arbitrator had been non-responsive and was unable to perform his functions. Thus, as per Sections 14 and 15 of the Arbitration and Conciliation Act, 1996, the present case is suited for appointment of a substitute Arbitrator for adjudicating the disputes.”
“It is well settled principle that unilateral appointment of Arbitrator is not permissible under the law”
In the facts of this case, there is no reference to the Circular whereby the arbitration clause has been incorporated in the contract between the parties. It is true that the policy decision in terms of the Circular is to make arbitration a mechanism for dispute resolution both in cases of existing and future contracts.
Supreme Court, while allowing the present petition, appointed Justice Sanjay Kishan Kaul, Former Judge of the Supreme Court of India, to act as the sole arbitrator.
Punjab and Haryana High Court commented that “Such an approach would defeat the intent and objective behind the incorporation of the Act of 1996, which provides for a speedy and efficacious resolution of disputes.”
The Calcutta High Court emphasised the need for a clear and unequivocal expression of intent to arbitrate.
Bombay High Court held the instant applications under Section 11 of Arbitration Act as non-maintainable and dismissed the said applications.