Topic
The Arbitration and Conciliation Act, 1996 governs domestic and international arbitration proceedings in India, including challenges to awards under Section 34 and appointment of arbitrators under Sections 11 and 12(5).
The Madras HC ruled that a writ petition under Article 226 cannot challenge an MSMED Council award under Section 18 after a failed Section 34 petition, as Section 37 appeal is the exclusive remedy. The court barred the party from approbating and reprobating on the award's nature.
The Delhi High Court held that Article 227 supervisory jurisdiction survives the Section 37(3) bar on second appeals to review a Section 37(2)(b) appellate order, but dismissed the petition on merits. The court upheld the appellate court's modification of the arbitrator's Section 17 interim direction limiting document production to the pre-arbitration period, finding no perversity warranting interference.
The Delhi High Court held that an arbitral award granting 9% interest on a Performance Bank Guarantee from the date of invocation violated public policy under Section 34(2)(b)(ii) where the contract expressly excluded interest under Clause 13(2). The court set aside this portion of the award while upholding the rejection of the delayed shipment claim. The ruling reinforces that arbitrators cannot rewrite contractual terms on interest, and such overreach renders an award contrary to fundamental policy of Indian law.
Delhi HC held that a lender cannot get extra Section 9 relief if mortgage security exists and SARFAESI enforcement is pending, absent proof of immediate asset threat. The decision affects banks seeking arbitration interim relief alongside loan remedies.
The Bombay HC granted an interim injunction under Section 9 of the Arbitration Act, restraining non-signatory associate Udayak Agro from ‘SURE’ water and confidential information, applying Section 9 to indirect breaches and setting a 4-week disclosure deadline.
The Supreme Court ruled that a personal guarantee defined as a Facility Agreement and deemed part of the loan agreement 'as if set out in extension' incorporates the loan agreement's arbitration clause under Section 7(5). This binds guarantors to arbitration without a separate clause, overturning orders deleting them from proceedings.
The Supreme Court held that a writ court directing an arbitral tribunal to adjudicate claims 'strictly in accordance with the contract' impermissibly fetters the tribunal's Section 16 kompetenz-kompetenz over excepted matters. The ruling reinforces that tribunals retain exclusive initial jurisdiction to rule on their own jurisdiction, including disputes over contract termination validity, free from judicial pre-direction. This protects party autonomy in arbitration, particularly in government infrastructure contracts with standard general conditions.
Bombay HC holds that a mortgagor discharging a borrower's debt cannot invoke the lender's arbitration clause against the borrower by subrogation, as mere payment does not transfer arbitration rights absent express assignment or a statutory subrogation regime extending to the arbitration agreement.
The Bombay High Court held that the clause 'Arbitration Subject to Mumbai Jurisdiction' in a purchase order constitutes a valid arbitration agreement under Section 7, even though it lacks mandatory referential language or procedural machinery. The court appointed a sole arbitrator under Section 11(6), affirming that minimalist clauses can satisfy the statutory threshold for arbitration agreements in commercial contracts.
Limitation for executing a 2008 arbitral award runs from 23 October 2015, when amended Section 36 made awards immediately enforceable, not the award date. Pre-amendment law required the Section 34 challenge period to expire first, blocking execution for seven years per National Aluminium. The ruling shields award holders from statutory gaps that delayed enforcement.
The Bombay High Court held that an assignee of ownership rights is not bound by an arbitration clause in a development agreement unless the arbitration agreement is expressly assigned or accepted. The court also ruled that limitation objections fall within the arbitral tribunal's jurisdiction under Section 16, not the Section 11 court's purview at the appointment stage.
The Delhi High Court held that for Section 11(6) applications, the limitation period begins only upon formal rejection of a claim, not from preliminary correspondence. The court also ruled that the mandatory mediation period under the contract must be excluded from the limitation calculation, appointing a sole arbitrator in a duty-free shop licence dispute with AAI.
Without the requisite stamp duty, an arbitral award cannot be treated as a valid instrument for execution. The Delhi High Court also stayed any enforcement while a Section 34 challenge remains pending, leaving the award ineffective until the petition is finally decided. This restricts award holders and creditors from pursuing recovery until both stamp duty is paid and the petition is resolved.
Delhi HC rules arbitration clause survives final award for subsequent distinct disputes, appointing arbitrator under Section 11(6) for GST reimbursement claim. Court confines Section 11 inquiry to prima facie existence of arbitration agreement, not dispute merits. Decision protects arbitration rights in long-term contracts where fresh claims arise post-award.
The Delhi High Court rejected the Section 34 challenge to the 2018 arbitral award on the Safdarjung Tomb illumination contract, reiterating that awards can be set aside only on the narrow grounds enumerated in the Arbitration Act. This reinforces limited judicial interference, affecting parties seeking to overturn commercial arbitration outcomes.