Arbitration Annual Digest 2025- Part 2

Gauhati High Court Mere Existence Of Arbitration Clause In Agreement Does Not Oust Jurisdiction Of Civil Court To Entertain Suit: Gauhati High Court Case Title: M/S J.M.B. Construction And 2 Ors. Versus Dr. Somesh Dhar And 3 Ors. Case No:Arb.A./8/2024 The Gauhati High Court bench of Justice Malasri Nandi has held that merely because there is an arbitration clause providing for referring the dispute and the claim to the arbitration, the civil court's jurisdiction is not barred but the same is subject to Section 8 of the Arbitration Act, 1996. The court noted that in S.Vanathan Muthuraja vs. Ramalingam @ Krishnamurthy Gurukkal & Ors., (1997) the Supreme Court held that when a legal right is infringed, a civil suit would lie unless entertainment of such suit is specifically barred. The normal rule is that a civil court would have jurisdiction to entertain all suits of a civil nature except those whose cognizance is either explicitly or by implication is barred. It also relied on the Supreme Court judgment in ITI Ltd. vs. Siemens Public Communications Network Ltd., (2002) where it was held that application of the code is not specifically prohibited when it comes to proceedings arising out of the Act before the court. Gujarat High Court Court's Jurisdiction U/S 34 Of Arbitration Act Against Award Under MSMED Act Is Determined By Agreement Between Parties: Gujarat HC Case Title: UTTAR GUJARAT VIJ COMPANY LIMITED Versus GUPTA POWER INFRASTRUCTURE LIMITED Case No: R/FIRST APPEAL NO. 1728 of 2022 With CIVIL APPLICATION (FOR STAY) NO. 1 of 2022 In R/FIRST APPEAL NO. 1728 of 2022 The Gujarat High Court bench of Mrs. Chief Justice Sunita Agarwal and Mr.Justice Pranav Trivedi of has held that the jurisdiction of the Court to hear the application under Section 34 of the Arbitration Act' 1996 as to challenge the award passed under Section 18(4) of the MSMED Act' 2006, would be governed by the agreement between the parties which has conferred exclusive jurisdiction to a particular Court. The court at the outset while noting the interplay between the MSMED Act and the Arbitration Act observed that the overriding effect has been given by virtue of Section 18(4) read with Section 24 of the MSMED Act' 2006 over any agreement between the parties in relation to the dispute covered by the MSMED Act' 2006 and in so far as the claim under Section 17, where it has been kept open to the parties to refer the dispute to the MSME Facilitation Council. It further added that by virtue of Section 2(4) read with Section 7, in so far as the arbitration proceedings are concerned, they shall be governed by the statutory enactment, which would result in replacing the mode and manner of appointment of arbitral tribunal under the Arbitration Act' 1996. The provisions of the Arbitration Act' 1996 which are inconsistent with the statutory enactment shall not apply. Writ Court Interfering With Every Procedural Order In Arbitral Proceedings Is Contrary To Aim Of A&C Act: Gujarat HC Case Title: Gujarat Power Corporation Limited v. Tata Power Renewable Energy Limited Case No: R/Special Civil Application No. 6910 of 2025 The Gujarat High Court while dismissing a writ petition filed under Article 226 and 227 of the Constitution observed that the Writ Court can exercise their power only in cases where the only if the order in questions is “completely perverse”, or the order in questions is crippled with “bad faith” or the order in questions falls in the category of “rarest of rare circumstances”. The bench of Justice Mauna M. Bhatt further held that if the Writ Court exercises its jurisdiction in curing every procedural lapse in arbitral proceedings, the same would amount to opening Pandora's box, which would be contrary to the principle of minimum judicial intervention. The bench observed that the impugned judgment does not pass the test of either being “perverse” or having been passed in “bad faith” to warrant the Writ Court to exercise judicial interference. The order was passed by the Ld. Sole Arbitrator takes a plausible view, and even no stretch of imagination can compel the impugned order to be treated as “exceptional” or “rare”, such that it would shock the conscience of a prudent person Arbitration Act: Gujarat High Court Case Title: National Highways Authority Of India v. Kishorbhai Valjibhai Jethani & Ors. Case Number: C/FA/4705/2023 The Gujarat High Court bench of Chief Justice Sunita Agarwal and Justice Pranav Trivedi has held that the plea that limitation period for challenging the award under section 34 of the Arbitration and Conciliation Act, 1996 (Arbitration Act) did not start as the signed copy of the award was not received by the party, cannot be raised for the first time in appeal under section 37 of the Arbitration Act. It was further observed that if the applicant/ NHAI was aware of the fact that the...

Arbitration Annual Digest 2025- Part 2

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