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“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 Court clarified that the ‘Closest Connection Test’ for determining the seat of arbitration is no longer a viable criterion for determination. The seat of arbitration cannot be determined by formulaic and unpredictable application of choice of law rules based on abstract connecting factors to the underlying contract.
The Supreme Court elucidated the key factors through which the intention of the parties to be bound by an arbitration agreement can be gauged.
Supreme Court upheld the High Court’s decision and emphasised the need for early enforcement of the foreign award by the competent forum.
by Kunal Mimani† and Kartikey Bhatt††
“Even though a subsidiary derives interests or benefits from a contract entered into by the company within a group, they would not be covered under the expression “claiming through or under” merely on the basis that it shares a legal or commercial relationship with the parties.”
“The approach in Chloro Controls India Private Limited v. Severn Trent Water Purification, (2013) 1 SCC 641 to the extent that it traces the group of companies doctrine to the phrase ‘claiming through or under’ as given under Section 8 of the Arbitration Act was erroneous and against the well settled principles of contract in commercial law”.
by Vasanth Rajasekaran* and Harshvardhan Korada**
Cite as: 2023 SCC OnLine Blog Exp 79
The Bombay High Court explained that if it was to consider the instant application under Section 11 of A&C Act, it would have to work on the deficiency of stamp duty and penalty, if any.
“The Court observes that the ‘contrary indicia’ is clearly reflected in the present case, because the seat was mentioned as Bikaner and venue was mentioned as New Delhi.”
A party cannot simply raise an objection on the ground of patent illegality if the Award is against them. Patent illegality requires a distinct transgression of law, the clear lack of which makes the petition a pointless effort of objection towards an Award passed by a competent Arbitral Tribunal.
“District Court, Karnal where the first petition was filed pertaining to the Agreement in question alone shall have jurisdiction over the arbitral proceedings and all subsequent applications arising out of the Licence Agreement. No other Court can entertain any subsequent application.
“The Court exercised the powers conferred under Section 11 of the Arbitration and Conciliation Act, 1996 and appointed, Jai Prakash Narayan Purohit, Retired Additional District Judge, as the sole Arbitrator to adjudicate the dispute between the parties.”
The case relates as to how the statutory mandate under Section 11(13) of Arbitration and Conciliation Act, 1996 which aims at expeditious disposal of petitions under Section 11 of the Act, is harmonized with the obligation imposed vide the judgment N.N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd, (2023) 7 SCC 1, to act in tune with the statutory dictate of the Indian Stamp Act, 1899.
“It is palpably clear that the language of the purported arbitration clause must evidence an unambiguous, explicit and unequivocal intention to refer the disputes to arbitration, leaving no room for doubt that parties chose arbitration as their only mode of resolution of disputes.”
An Arbitral Tribunal cannot arrogate to itself powers that are neither conferred by the statute, or the rules which govern the arbitration, nor can it take recourse to inherent powers, which as has been found hereinabove, are acknowledged to inhere in courts and judicial authorities only.
Calcutta High Court held that Court should not substitute its own view, replacing that of the arbitrator, unless it is manifestly evident that there existed no agreement.
by Vasanth Rajasekaran†
Cite as: 2023 SCC OnLine Blog Exp 57
by Swarnendu Chatterjee† and Megha Saha††
Cite as: 2023 SCC OnLine Blog Exp 41
by Vasanth Rajasekaran †
Cite as: 2023 SCC OnLine Blog Exp 38