Arbitration Half Yearly Digest 2025- Part 2

Supreme Court Arbitral Tribunal Can Proceed Against Party Though They Weren't Served With S.21 Notice Or Made Party In S.11 Application : Supreme Court Case Title: ADAVYA PROJECTS PVT. LTD. VERSUS M/S VISHAL STRUCTURALS PVT. LTD. & ORS., CIVIL APPEAL NO. 5297 OF 2025 Citation : 2025 LiveLaw (SC) 439 The Supreme Court recently observed that not being served with the notice invoking arbitration under Section 21 of the Arbitration and Conciliation Act, and not being made a party in the Section 11 application (for appointment of arbitrator), are not sufficient grounds to hold that a person cannot be made party to arbitral proceedings. "A notice invoking arbitration under Section 21 of the ACA is mandatory...and it is a prerequisite to filing an application under Section 11. However, merely because such a notice was not issued to certain persons who are parties to the arbitration agreement does not denude the arbitral tribunal of its jurisdiction to implead them as parties during the arbitral proceedings...merely because a court does not refer a certain party to arbitration in its order does not denude the jurisdiction of the arbitral tribunal from impleading them during the arbitral proceedings as the referral court's view does not finally determine this issue. The relevant consideration to determine whether a person can be made a party before the arbitral tribunal is if such a person is a party to the arbitration agreement", said a bench of Justices PS Narasimha and Manoj Misra. Supreme Court Flags Long Submissions In S.34/37 Arbitration Act Proceedings, Says Timelimit Needs To Be Imposed Case Title: LARSEN AND TOUBRO LTD. VERSUS PURI CONSTRUCTION PVT. LTD. & ORS. Citation : 2025 LiveLaw (SC) 449 On April 21, the Supreme Court expressed its displeasure over the prolonged arguments and submissions made by members of the Bar in arbitration proceedings under Sections 34 and 37 of the Arbitration and Conciliation Act, 1996. The Court noted that excessively long oral submissions force judges to invest significant time in reviewing extended arguments, often supported by a large volume of case law, regardless of their relevance. This practice, particularly in high-stakes matters, leads to unnecessarily lengthy judgments and ultimately undermines the efficiency and growth of arbitration as an effective dispute resolution mechanism in India. “We have noticed that there is a tendency on the part of senior members of the bar to argue as if these proceedings were regular appeals under Section 96 of CPC. In this case, while making submissions, we learned counsels for both the parties have gone into minute and factual details…”, the bench comprising Justices Abhay S Oka and Pankaj Mithal said. Arbitral Award For Claims Not Included In IBC Resolution Plan Can't Be Enforced: Supreme Court Case Title – Electrosteel Steel Limited (Now M/S ESL Steel Limited) vs Ispat Carrier Private Limited Citation : 2025 LiveLaw (SC) 491 The Supreme Court recently allowed an appeal challenging the enforcement of an arbitral award passed by the Micro and Small Enterprises Facilitation Council (MSEFC) against Electrosteel Steels Ltd., holding that the award was non-executable in view of the resolution plan approved under Section 31 of the Insolvency and Bankruptcy Code (IBC), 2016. “we have no hesitation to hold that upon approval of the resolution plan by the NCLT, the claim of the respondent being outside the purview of the resolution plan stood extinguished. Therefore, the award dated 06.07.2018 is incapable of being executed”, the Court said. A bench of Justice Abhay S. Oka and Justice Ujjal Bhuyan reiterated that once a resolution plan is approved by the National Company Law Tribunal (NCLT) under Section 31(1) of the IBC, any claim that is not part of the plan stands extinguished and cannot be pursued further. S.34 Arbitration Act | Respect Arbitral Autonomy; Judicial Interference Should Be Minimal : Supreme Court Case Title: CONSOLIDATED CONSTRUCTION CONSORTIUM LIMITED VERSUS SOFTWARE TECHNOLOGY PARKS OF INDIA Citation : 2025 LiveLaw (SC) 501 The Supreme Court reiterated that the courts cannot go beyond the scope of Section 34 of the Arbitration & Conciliation Act, 1996 (“Arbitration Act”) while deciding an application for setting aside of an award. "the role of the court under Section 34 of the 1996 Act is clearly demarcated. It is a restrictive jurisdiction and has to be invoked in a conservative manner. The reason is that arbitral autonomy must be respected and judicial interference should remain minimal otherwise it will defeat the very object of the 1996 Act.”, the court added. Holding thus, the bench comprising Justices Abhay S. Oka and Ujjal Bhuyan upheld the Madras High Court Division Bench's ruling, which had overturned the Single Judge's interference with the tribunal's decision based on a...

Arbitration Half Yearly Digest 2025- Part 2

Mohd Talha Hasan

Tags