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Arbitration

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ARBITRATION ACT = The law is well settled that where an Arbitrator had already been appointed and intimation thereof had been conveyed to the other party, a separate application for appointment of an Arbitrator is not maintainable. Once the power has been exercised under the Arbitration Agreement, there is no power left to, once again, refer the same disputes to arbitration under Section 11 of the 1996 Act, unless the order closing the proceedings is subsequently set aside. = when the Arbitral Tribunal is already seized of the disputes between the parties to the Arbitration Agreement, constitution of another Arbitral Tribunal in respect of those same issues which are already pending before the Arbitral Tribunal for adjudication, would be without jurisdiction.= In view of the language of Article 20 of the Arbitration Agreement which provided that the arbitration proceedings would be held in accordance with the rules and procedures of the International Chamber of Commerce or UNCITRAL, Devas was entitled to invoke the Rules of Arbitration of the ICC for the conduct of the arbitration proceedings. Article 19 of the Agreement provided that the rights and responsibilities of the parties thereunder would be subject to and construed in accordance with the laws of India. There is, therefore, a clear distinction between the law which was to operate as the governing law of the Agreement and the law which was to govern the arbitration proceedings. Once the provisions of the ICC Rules of Arbitration had been invoked by Devas, the proceedings initiated there under could not be interfered with in a proceeding under Section 11 of the 1996 Act. The invocation of the ICC Rules would, of course, be subject to challenge in appropriate proceedings but not by way of an application under Section 11(6) of the 1996 Act. Where the parties had agreed that the procedure for the arbitration would be governed by the ICC Rules, the same would necessarily include the appointment of an Arbitral Tribunal in terms of the Arbitration Agreement and the said Rules. Arbitration Petition No.20 of 2011 under Section 11(6) of the 1996 Act for the appointment of an Arbitrator must, therefore, fail and is rejected, but this will not prevent the Petitioner from taking recourse to other provisions of the aforesaid Act for appropriate relief. The Arbitration Petition is, therefore, dismissed.

Page 1     1 REPORTABLE IN THE SUPREME COURT OF INDIA ORIGINAL CIVIL JURISDICTION ARBITRATION PETITION NO. 20 OF 2011 ANTRIX CORP. LTD. …PETITIONER Vs. DEVAS MULTIMEDIA P. LTD. …RESPONDENT J U D G M E N T ALTAMAS KABIR, CJI. 1. An application under Section 11(4) read with Section 11(10) of the Arbitration and … Continue reading

ARBITRATION ACT= The matter was, thereafter, taken up by the designate Judge who came to a finding that the agreement dated 24.05.2005 was not legal and valid and, therefore, the disputes between the parties arising out of the said agreement could not be referred to an arbitrator. The application under Section 11(6) of the 1996 Act was, therefore, dismissed. 9. It is the said decision of the designate Judge, which is the subject matter of challenge in these appeals. The issue regarding the continued existence of the arbitration agreement, notwithstanding the main agreement itself being declared void, was considered by the 7-Judge Bench in SBP & Co. (supra) and it was held that an arbitration agreement could stand independent of the main agreement and did not necessarily become otiose, even if the main agreement, of which it is a part, is declared void. has to first decide his own jurisdiction and whether the party concerned has approached the right High Court.; whether there is an arbitration agreement and as to whether the person who has made the request before him, is a party to such agreement. ; whether the claim was a dead one or a long-barred claim, that was sought to be resurrected. = The above views expressed by the 7-Judge Bench and by the learned Single Judge are sufficient to dispose of these appeals. In the light of what has been indicated hereinbefore, we have no hesitation in setting aside the impugned judgment and the order of the designated Judge once again and directing that the matter be again considered de novo in the light of the observations made hereinabove and the various decisions cited at the Bar.

Page 1 1 REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO.4596 OF 2013 [Arising out of SLP(C)No.7334 of 2010] M/s Today Homes & Infrastructure Pvt. Ltd. …Appellant Vs. Ludhiana Improvement Trust & Anr. …Respondents WITH C.A. No.4597 of 2013 @ SLP(C)No.11778/2010, C.A. No.4598 of 2013 @ SLP(C)No.10795/2010, C.A. No.4595 of 2013 … Continue reading

forfeited its right to appoint the arbitrator = whether respondent No. 1 has forfeited its right to appoint the arbitrator having not done so after the demand was made and till the appellant had moved the court under Section 11(6) and, if the answer is in the affirmative, whether the appointment of the arbitrator by respondent No. 1 in the course of the proceedings under Section 11(6) is of any legal consequence and the Chief Justice of the High Court ought to have exercised the jurisdiction and appointed an arbitrator? – In the present case, the Corporation has failed to act as required under the procedure agreed upon by the parties in Clause 29 and despite the demand by the dealer to appoint the arbitrator, the Corporation did not make appointment until the application was made under Section 11(6). Thus, the Corporation has forfeited its right of appointment of an arbitrator. In this view of the matter, the Chief Justice ought to have exercised his jurisdiction under Section 11(6) in the matter for appointment of an arbitrator appropriately. The appointment of the arbitrator by the Corporation during the pendency of proceedings under Section 11(6) was of no consequence. In the course of arguments before us, on behalf of the appellant certain names of retired High Court Judges were indicated to the senior counsel for the Corporation for appointment as sole arbitrator but the Corporation did not agree to any of the names proposed by the appellant. In the circumstances, we are left with no choice but to send the matter back to the Chief Justice of the Allahabad High Court for an appropriate order on the application made by the dealer under Section 11(6). 25. Civil Appeal is, accordingly, allowed. The impugned order is set aside. Arbitration Case No. 107 of 2004, M/s. Deep Trading Company v. M/s. Indian Oil Corporation and others, is restored to the file of the High Court of Judicature at Allahabad for fresh consideration by the Chief Justice or the designate Judge, as the case may be, in accordance with law and in light of the observations made above. No costs.

Page 1 REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 2673 OF 2013 (Arising out of SLP(C) No. 24686 of 2007) M/s. Deep Trading Company …… Appellant Vs. M/s. Indian Oil Corporation and Ors. ……Respondents JUDGMENT R.M. LODHA, J. Leave granted. 2. The questions that arise for consideration in this appeal, … Continue reading

what is the arbitration agreement ? = the pre-requisites of a valid and binding arbitration agreement leading to an appropriate reference under the Act. Section 2(1)(b) defines `arbitration agreement’ to be an agreement referred to in Section 7. Section 7 of the Act states that an `arbitration agreement’ is an agreement by the parties to submit to arbitration all or certain disputes which have arisen or which may arise between them in respect of a defined legal relationship, whether contractual or not. The arbitration agreement may be in the form of an arbitration clause in a contract or in the form of a separate agreement and shall be an agreement in writing. An arbitration agreement is in writing if it is contained in any of the clauses i.e. clauses (a) to (c) of Sub-section (4) of Section 7 of the Act. Once these ingredients are satisfied, there would be a binding arbitration agreement between the parties and the aggrieved party would be in a capacity to invoke the jurisdiction of this Court under Section 11(6) of the Act.

IN THE SUPREME COURT OF INDIA CIVIL ORIGINAL JURISDICTION ARBITRATION PETITION (CIVIL) NO. 5 OF 2010 Powertech World Wide Limited … Petitioner Versus Delvin International General Trading LLC … Respondent O R D E R Swatanter Kumar, J. 1. M/s. Powertech World Wide Limited, the petitioner, is a limited company registered under the Companies Act, … Continue reading

Arbitration and Conciliation Act, 1996: s. 9-Application for interim measures by court-Unregistered partnership firm in liquor trade-Application by one of the partners for appointment of receiver to take charge of business of the firm-Trial court dismissing the application on the ground that name of the applicant does not figure in the register of firms as partner of the firm-High Court allowed the application holding that s.69(3) of the Partnership Act is not attracted to an application u/s 9 of the Act-High Court further directed that the partners who were running the business would run the business as receivers till 31.12..2003 and from 1.1.2004 to 31.3.2004 the applicant and two other partners of his group would run the business as receivers s.9-Unregistered partnership firm-Application by one of the partners for directions to appoint receiver-Maintainability of- s. 9- “party “-Invoking s. 9-An application u/s. 9 is not a suit- ‘Parity’ is defined in s. 2(1 )(h) to mean a party to an arbitration agreement-So right conferred by s.9 is on a party to an arbitration agreement-Right conferred by s. 9 cannot be said to be one arising out of a contract-Filing of an application u/s 9 by a party by virtue of its being a party to.an arbitration agreement is for securing a relief which the court has power to grant before, during, or after arbitral proceedings by virtue of s.9 of the Act-The relief sought for in an application u/s 9 is neither in a suit nor a right arising from a contract-Party invoking s.9 may not have actually commenced arbitral proceedings but must be able to satisfy the court that the arbitral proceedings are actually contemplated or manifestly intended. =2004 AIR 1433, 2004(1 )SCR404 , 2004(3 )SCC155 , 2004(1 )SCALE297 , 2004(2 )JT352 =Held, order passed by court should fall within the meaning of expression ‘an interim measure of protection’ as distinguished from an alt time of permanent protection-It is a serious matter to appoint a receiver on a running business-This is not a case of oppression of minority by majority-A better course would have been to allow the conduct of the business continuing in the hands of the persons who were doing so but at the same time issuing such directions and/or devising such arrangement as would protect and take care of the interest of those who are not actually running the business-Purpose of enacting s. 9 is to provide ‘interim measures of protection’-Though order of High Court appointing a receiver on the partnership business is maintained, the rest of the order is set aside- Directions given inter alia, for running the business by the group of partners who were running it prior to interim order of High Court under their control but as receivers, and for appointment of an official as observer- Interim order-Partnership Act, I932-s.69(3). Held, Court u/s 9 is only formulating interim measures so as to protect the right under adjudication before the arbitral tribunal from being frustrated-Prima facie, the bar enacted by s. 69 of Partnership Act does not affect the maintainability of an application under s.9 of the Act-s. 69 of Partnership Act has no bearing on the right of a party to an arbitration clause to file an application under s.9 of the Act. M/s. Sundaram Finance Ltd. v. Ms. NEPC India Ltd, AIR 1999 SC 565, relied on. Kamal Pushpa Enterprises v. DR Construction Company, AIR (2000) SC 2676; Jagdish Chandra v. Kajaria Traders (Ind.) Ltd., AIR (1964) SC 1882 and Delhi Development Authority v. Kochhar Construction Work and Anr., [1998] 8 SCC 559, referred to. M/s. Shreeram Finance Corporation Ltd. v. Yasin Khan and Ors., [1989] 3 SCC 476, cited. Words and phrases: Word ‘before’ in s. 9 of Arbitration and Conciliation Act, 1996-Connotation of. CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 132 and 131 of 2004. From the Judgment and Order dated 18.12.2003 of the Madhya Pradesh High Court in M.A. No.2484 of 2003. Harish N. Salve, Dr. A.M. Singhvi, Kapil Sibaii, P. Chidambaram, R.F. Nariman, Vivek Tankha, Rohit Arya, C. Mukhopadhyaii, Manu Nair, Ms. Shalini, Rakesh K. Khanna, Aseem Mehrotra, Kanahaya Singh, Rajeev Singh, Rajesh Prasad Singh, Akshay Arora, P.K. Bansal, Pankaj Kr. Singh, K.L. Janjani and Ms. Abha R. Sharma for the appearing parties.

CASE NO.: Appeal (civil) 131-132 of 2004 PETITIONER: FIRM ASHOK TRADERS AND ANR. ETC. RESPONDENT: GURUMUKH DAS SALUJA AND ORS. ETC. DATE OF JUDGMENT: 09/01/2004 BENCH: R.C. LAHOTI & ASHOK BHAN JUDGMENT: JUDGMENT 2004(1)SCR 404 The following Order of the Court was delivered : Leave granted in both the SLPs. The dispute is among 12 … Continue reading

Arbitration Act, 1940-Sections 20 and 39(iv)-Arbitration and Conciliation Act, 1996-Sections 21 and 85(2)(a)-Application for appointment of arbitrator in terms of arbitration clause in case of dispute between parties-Trial Court holding that firm being unregistered as such application not maintainable even though applicant firm filed amendment application with regard to the same-High Court holding that since 1996 Act has come into force parties to relegate under the new Act-On appeal held : Since the arbitral proceedings commenced before coming into force of the 1996 Act, provisions of 1940 Act applicable and matter remitted to High Court-Furthermore firm must be registered at the time of the institution of the suit and not later-Also, the High Court is to consider the correctness of the order passed by trial court-Partnership Act, 1932- Section 69. Appellant-State Sugar Corporation and respondent-construction company entered into a contract. Dispute arose between the parties but the appellant did not appoint any arbitrator as per the arbitration clause in the contract. Respondent filed application under section 20 of the Arbitration Act, 1940. Civil Judge held it to be not maintainable as the respondent firm was not registered even though the respondent had admitted that it failed to make necessary averment in the plaint as regard registration of the firm inadvertently and had filed an application for amendment of the petition. Respondent then filed an appeal. High Court allowed the appeal directing that since the Arbitration and Conciliation Act, 1996 has come into force, parties are to relegate under the new Act Hence the present appeal. Appellant-State Sugar Corporation contended the application for appointment of an arbitrator was not maintainable under the 1940 Act and the 1996 Act as the respondent firm was not registered; and that in any event, the impugned judgment is unsustainable in law as the arbitral proceeding was initiated prior to coming into force of the 1996 Act. Respondent-firm contended that in a similar matter this Court directed the trial court to appoint an arbitrator in terms of arbitration clause of the contract between the parties, on remitting the matter, and as such there being a similar stipulation in the instant case, it must be acted upon. =Allowing the appeal, the Court HELD : 1.1. In the event it is found by the High Court that the Civil Judge was wrong in rejecting the application for amendment of the plaint and in fact the respondent-firm was registered under the Partnership Act, the question of throwing out the said suit on that ground would not arise. High Court would consider these questions. Further, it is true that the arbitral proceedings would not be maintainable at the instance of an unregistered firm having regard to the mandatory provisions contained in Section 69 of the Partnership Act, 1932. The firm must be registered at the time of institution of the suit and not later. [830-F-G] Delhi Development Authority v. Kochhar Construction Work and Anr., [1998] 8 SCC 559, relied on. Jagdish Chandra Gupta v. Kajaria Traders (India) Ltd., AIR (1964) SC 1882 and Firm Ashok Traders and Anr. v. Gurumukh Das Saluja and Ors., [2004] 3 SCC 155, referred to. 1.2. Disputes and differences between the parties arose in the year 1991 and the respondent filed an application under Section 20 of the Arbitration Act, 1940 in the same year. It invoked the arbitration clause in the agreement. The arbitral proceeding was set in motion. In terms of Section 21 of the Arbitration and Conciliation Act, 1996 the arbitral proceedings in respect of a particular dispute commences on a date on which the request for that dispute to be referred to arbitration was received by the respondent. Therefore, in respect of the arbitral proceedings commenced before coming into force of the 1996 Act, the provisions of the 1940 Act would apply. Hence, the matter is remitted to High Court for afresh consideration. [831-A-B; 832-A-B] Milkfood Ltd. v. M/s. GMC Ice Cream (P) Ltd., JT (2004) 4 SC 393, relied on. CIVIL APPELLATE JURISDICTION : Civil Appeal No. 5479 of 2004. =2004 AIR 4335, 2004(3 )Suppl.SCR826 , 2004(7 )SCC332 , 2004(7 )SCALE307 , 2004(7 )JT61

CASE NO.: Appeal (civil) 5479 of 2004 PETITIONER: U.P. State Sugar Corporation Ltd. RESPONDENT: Jain Construction Co. & Anr. DATE OF JUDGMENT: 25/08/2004 BENCH: N. Santosh Hegde & S.B. Sinha JUDGMENT: J U D G M E N T (Arising out of SLP (C) No.4459 of 2004) S.B. SINHA, J : Leave granted. This appeal … Continue reading

Indian Arbitration and Conciliation Act, 1996: Section 11(5)-Appointment of arbitrator-Application by the legal heir of the deceased partner-Held, maintainable. Indian Partnership Act, 1932; Section 46-Rendition of accounts-Legal representative of a deceased partner-Right to sue-Held, survives on the legal representative. The Short questions involved in the appeals were: (a) Where right to sue for rendition of accounts survives on the legal representative of a deceased partner, are the legal representative not entitled to invoke arbitration clause contained in the Partnership Deed? (b) Whether the arbitration can be commenced by the heirs after the death of partner especially where the dispute had arisen during the life time of the partner? (c) Whether in view of section 46 read with section 48 of the Indian Partnership Act, 1932 as well as section 40 of the Arbitration Act, 1996. The legal representative of the deceased partner is entitled to claim appointment of arbitrator under the arbitration clause of the Partnership Deed? =2007 AIR 1517, 2007(4 )SCR295 , , 2007(4 )SCALE562 , 2007(4 )JT523

CASE NO.: Appeal (civil) 1526 of 2007 PETITIONER: Ravi Prakash Goel RESPONDENT: Chandra Prakash Goel & Anr DATE OF JUDGMENT: 21/03/2007 BENCH: Dr. AR. Lakshmanan & Altamas Kabir JUDGMENT: J U D G M E N T (Arising Out of SLP (C) NO. 6723 OF 2006) Dr. AR. Lakshmanan, J. Leave granted. The above appeal … Continue reading

Partnership Act : 1832 : Partnership firm-Re-registration-Effect of-Firm registered in 1949-Again registered comprising some of the original partners in 2005 with the same name-Earlier firm not dissolved-Held, registration of the firm in the same name again in 2005 does not affect the status of the firm. Arbitration and Conciliation Act, 1996 : ss. 9 and 11 (4) (b)-Interim order by District Judge u/s 9-Propriety of-Arbitration clause is an agency agreement-Agreement for a specific period having come to an end-Parties nominating their respective arbitrators but both the arbitrators so nominated failing to nominate presiding arbitrator-Application u/s 11 (4)(b) before Chief Justice of High Court for appointing third arbitrator-Meanwhile on application, District Judge granting interim order to maintain status quo until arbitral tribunal takes the matter-High Court vacating the interim order-Held, Adequate grounds are not made out at this interlocutory stage for interfering with order of High Court and parties are left to have their disputes resolved in terms of arbitration agreement-As agreed by both the parties, sole arbitrator appointed to decide the disputes between the parties-Except the question of maintainability of appeal filed by respondent before High Court on the pretext of re-registration, since, the appeal has been held to be maintainable, all the other questions are left open for decision by the sole arbitrator. Respondent no. 1, a partnership firm was constituted in the year 1949 bearing registration no. 71/1949. It was reconstituted in subsequent years taking in some additional partners. On 14.3.1991 the respondent-firm entered into an agency agreement with the appellant, a private limited company, engaging the latter as a raising contractor in respect of the mines for which the former had obtained leases from the State Government. On 25.3.1991 the respondent firm executed an irrevocable power of attorney in favour of the appellant authorizing it to administer the mines and sell the iron ore extracted therefrom. The agency agreement was to end on 31.3.2006. The appellant sought a further extension of the term but respondent no.1 was not willing for an extension. Disputes arose between the parties and by a letter dated 9.12.2005 the appellant invoked the arbitration clause in the agency agreement and nominated its arbitrator. The respondent firm registered itself again on 24.12.2005 bearing registration no. 595/2005. It, however, in turn also nominated an arbitrator. The arbitrators so nominated were to name the presiding arbitrator but since they failed to do so the appellant filed a petition under Section 11(4)(b) of the Arbitration and Conciliation Act, 1996 requesting the Chief Justice of the High Court to appoint the third arbitrator. While the said application was pending, the appellant company also filed an application under Section 9 of the Act before the District Judge for interim relief to permit it to continue to carry on the mining operations and to restrain the respondent from interfering with it. The District Judge directed status quo to be maintained until arbitral tribunal was constituted to adjudicate the dispute between the parties. The respondent filed an appeal before the High Court which held that since prima facie the agreement between the parties was not a specifically enforceable one in terms of the Specific Relief Act and since the terms of the agreement had expired, it was not appropriate to grant the interim order, and reversing the order of the District Judge, dismissed the application filed by the appellant-company. Aggrieved, the latter filed the instant appeal. It was contended for the appellant that it had entered into agreement with the firm bearing registration no. 71/1949, and since the appeal before the High Court was filed by the firm bearing registration no. 595/205, the same was not maintainable; that since the agreement entered with the appellant was, in the light of irrevocable Power of Attorney, co-terminus with the mining lease granted to the respondent firm, the same could not be terminated and would not come to an end by efflux time; and that powers under Section 9 of the Act, were independent of any restrictions placed by Specific Relief Act. =Dismissing the appeal, the Court HELD: 1. It was the appellant who filed the application under Section 9 of the Arbitration and Conciliation Act, 1996 impleading the respondent firm and its partners. The said firm represented by a partner, who even admittedly was a partner of the firm as constituted in the year 1949 and was also a party to the agreement with the appellant-company itself, had filed the appeal before the High Court. There is no case that the firm registered in the year 1949 had been dissolved. On the other hand, it was being reconstituted from time to time. Therefore, the fact that a firm in the same name was again registred in the year 2005, does not affect the status of the firm with which the appellant-company had a contract and the filing of the appeal by that firm represented by its partner. [Part 11] [187-B, C, D] 2. The effect of the agreement dated 14.3.1991 and the Power of Attorney dated 25.3.1991 admittedly executed between the parties and the rights and obligations flowing therefrom are really matters for decision by the Arbitral Tribunal. [Para 12] [187-F] 3.1. In the facts and circumstances, prima facie, it is not possible to say that the High Court was wrong in thinking that it may be a case where an injunction could not be granted in view of the provisions of the Specific Relief Act. But, that again will be a question for the arbitrator to pronounce upon. Suffice it to say that the position is not clear enough for this Court to assume for the purpose of this interlocutory proceeding that the appellant is entitled to specifically enforce the agreement dated 14.3.1991 read in the light of the Power of Attorney dated 2.5.3.1991. Of course, this aspect will be again subject to the contention raised by the appellant-company that the agreement created in his favour was co-terminus with the mining lease itself. But, these are the aspects to be considered by the Arbitral Tribunal Adequate grounds are not made out by the appellant at this interlocutory stage for interfering with the order of the High Court. In that view alone, it would be proper to decline to interfere with the order of the High Court and leave the parties to have their disputes resolved in terms of the arbitration agreement between the parties. [Para 13 and 14] [188-B, C, D, E] 4. The argument that the power under Section 9 of the Act is independent of the Specific Relief Act or that the restrictions placed by the Specific Relief Act cannot control the exercise of power under Section 9 of the Act cannot prima facie be accepted. Suffice it to say that prima facie exercise of power under Section 9 of the Act must be based on well recognized principles governing the grant of interim injunctions and other orders of interim protection or the appointment of a receiver. [Para 15] [188-F; 189-C, D] Firm Ashok Traders and Anr. v. Gurumukh Das Saluja and Ors., [2004] 3 SCC 155, held inapplicable. 5. It is seen that in spite of the parties naming their respective arbitrators in terms of the arbitration agreement, the arbitrators so appointed had not been able to nominate a presiding arbitrator. Since counsel on both sides agreed that this Court may appoint either a presiding arbitrator or a sole arbitrator for the purpose of resolving the disputes between the parties from the panel of names furnished, the Court appointed the sole arbitrator to decide on the disputes between the parties springing out the agreement dated 14.3.1991 and the Power of Attorney dated 25.3.1991. The arbitrator would be free to fix his terms in consultation with the parties. [Para 16] [189-D-G] Dr. A.M. Singhvi, Jaideep Gupta, Sr. Adv., Ashutosh Kaitan, P.K. Bansal, Deepak Khurana, Vishvjit Das, Umesh Kumar Khaitan, Amit Bhandari for the Appellant. A.K. Ganguly, Surya Prakash Mishra, K.K. Venugopal, Sr. Adv., S. Ravi Shankar, Rateesh, Barnali Basak, Visushi Chandana, S. Ravishankar, Yamunah Nachiar, S. Ravishankar for the Respondents.

CASE NO.: Appeal (civil) 2707 of 2007 PETITIONER: M/s Arvind Constructions Co. Pvt. Ltd RESPONDENT: M/s Kalinga Mining Corporation & Ors DATE OF JUDGMENT: 17/05/2007 BENCH: TARUN CHATTERJEE & P.K. BALASUBRAMANYAN JUDGMENT: J U D G M E N T CIVIL APPEAL NO. 2707 OF 2007 (Arising out of SLP(C) No. 3294 of 2007) P.K. … Continue reading

In the absence of arbitration clause, no case can be filed under arbitration act = mere use of the word ‘arbitration’ or ‘arbitrator’ in a clause will not make it an arbitration agreement, if it requires or contemplates a further or fresh consent of the parties for reference to arbitration. For example, use of words such as “parties can, if they so desire, refer their disputes to arbitration” or “in the event of any dispute, the parties may also agree to refer the same to arbitration” or “if any disputes arise between the parties, they should consider settlement by arbitration” in a clause relating to settlement of disputes, indicate that the clause is not intended to be an arbitration agreement. Similarly, a clause which states that “if the parties so decide, the disputes shall be referred to arbitration” or “any disputes between parties, if they so agree, shall be referred to arbitration” is not an arbitration agreement. Such clauses merely indicate a desire or hope to have the disputes settled by arbitration, or a tentative arrangement to explore arbitration as a mode of settlement if and when a dispute arises. Such clauses require the parties to arrive at a further agreement to go to arbitration, as and when the disputes arise. Any agreement or clause in an agreement requiring or contemplating a further consent or consensus before a reference to arbitration, is not an arbitration agreement, but an agreement to enter into an arbitration agreement in future.”

THE HON’BLE SRI JUSTICE B.SESHASAYANA REDDY   Arbitration Application No.141 of 2010 18-07-2011 Ms.Jain Irrigation Systems Limited,Jalgaon, Maharashtra,Joint Managing Director Shri Ajit Bhavarlal Jain Ms.Satyam Computer Services Limited, Mahindra Satyam Infocity,Madhapur, Hyderabad !COUNSEL FOR APPLICANT: Ms.C.Kodandaram, Senior Counsel COUNSEL FOR RESPONDENT: Ms.Shireen Sethana Baria :ORDER: This Arbitration Application has been taken out by the applicant … Continue reading

Though the Rules, Bye-laws and Regulations of the Exchange were not made under any statutory provision, they have a statutory flavour. Bye-laws 248 to 281D provide for and govern the arbitration between members and non-members and Bye-laws 282 to 315L provide for and govern the arbitration between members of the Exchange. 2. The first respondent raised and referred a dispute against the second respondent and the appellant under the Rules, Bye-Laws and Regulations of the Mumbai Stock Exchange on 29.8.1998 (Arbitration Reference No.242/1998) seeking an award for a sum of ` 36,98,384.73 with interest at 24% per annum on ` 35,42,197.50. =An arbitral tribunal cannot of course make use of their personal knowledge of the facts of the dispute, which is not a part of the record, to decide the dispute. But an arbitral tribunal can certainly use their expert or technical knowledge or the general knowledge about the particular trade, in deciding a matter. In fact, that is why in many arbitrations, persons with technical knowledge, are appointed as they will be well-versed with the practices and customs in the respective fields. All that the arbitrators have referred is the market practice. That cannot be considered as using some personal knowledge of facts of a transaction, to decide a dispute. Conclusion 17. In view of the above, we find no reason to interfere with the judgment of the High Court and the

1 REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO.9238 OF 2003 P.R. Shah, Shares & Stock Broker (P) Ltd. … Appellant Vs. M/s. B.H.H. Securities (P) Ltd. & Ors. … Respondents J U D G M E N T R.V. RAVEENDRAN, J. The appellant and the first respondent are members … Continue reading

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