Arbitration Monthly Digest: February 2025

Supreme Court 'Oral Undertaking Falls Within Scope Of Arbitration Clause' : Supreme Court Upholds Award Against Husband For Operation In Wife's Demat Account Case Title: AC CHOKSHI SHARE BROKER PRIVATE LIMITED VERSUS JATIN PRATAP DESAI & ANR. Citation : 2025 LiveLaw (SC) 178 The Supreme Court today (February 10) held that an oral contract undertaking joint and several liability falls within the scope of an arbitration clause. Holding so , the Court affirmed an arbitral award against a husband, finding him jointly liable for the award due to a debit balance in a joint demat account registered in his wife's name. The Court rejected the contention that the husband's liability constituted a "private transaction" beyond the scope of arbitration. Instead, it held that the arbitration clause, applicable to non-signatories, in conjunction with the husband's active participation in transactions within his wife's account, gave rise to an implied oral agreement establishing joint and several liabilities for both parties. Supreme Court Reiterates Narrow Scope Of Interference Under Section 37 Arbitration Act Case Name: M/s. C & C Constructions Ltd. vs. IRCON International Ltd., CIVIL APPEAL NO. 6657 OF 2023 Citation : 2025 LiveLaw (SC) 148 The Supreme Court reiterated that in appeal under Section 37 of the Arbitration and Conciliation Act, the Court has a narrower scope to review the arbitral award if the award has already been upheld under Section 34 (application for setting aside arbitral awards). Reliance was placed on the recent decision in Larsen Air Conditioning and Refrigeration Company vs Union of India. At the outset, the Bench of Justices Abhay S. Oka and Ujjal Bhuyan pointed out that the appellants have challenged the validity of clause 49.5 of the Contract that barred the appellant's present claim. However, given that this issue was not raised before the High Court, the appellant could not have raised this in the present appeal for the first time. “Careful perusal of the judgment of the learned Single Judge shows that the contention that the validity of clause 49.5 ought to be decided in the light of Sections 23 and 28 of the Contract Act was not raised before the learned Single Judge in a petition under Section 34. The said contention was not raised even before the Division Bench in appeal under Section 37. Therefore, it is not open to the appellant to raise the said contention in this appeal for the first time.” High Courts Allahabad High Court Section 36 Of Arbitration Act As Amended Applies To Pre-Amendment S.34 Applications: Allahabad High Court Reiterates Case Title: U.P. Jal Nigam (Urban) And Another vs. Spml Infra Ltd. Neutral Citation No.: 2025:AHC:20224 The Allahabad High Court bench of Justice Piyush Agrawal, placing reliance upon the judgment of the Supreme Court in Board of Control for Cricket in India vs. Kochi Cricket Private Limited & Others (2018), held that the amended Section 36 of the Arbitration and Conciliation Act, 1996 applies prospectively to court proceedings initiated on or after the date of commencement of the Amendment Act. Andra Pradesh High Court Limitation For Appointment Of Arbitrator Commences From Date Of Failure To Comply With Requirements In Notice Invoking Arbitration: AP High Court Case Title: Alliance Enterprises v. Andhra Pradesh State Fiber Net Limited (APSFL) Case Number: Arbitration Application No. 48 of 2023 The Andhra Pradesh High Court bench of Chief Justice Dhiraj Singh Thakur has held that the limitation period for filing an application seeking appointment of arbitrator under Section 11 (6) of the Arbitration and Conciliation Act, 1996, commences only after a notice invoking arbitration has been issued by one of the parties and there has been either a failure or refusal on the part of the opposite party to make an appointment as per the procedure agreed upon between the parties. The Court referred to the judgment of the Apex Court in Arif Azim Co. Ltd. v. Aptech Ltd. wherein the court had observed that the “limitation period for making an application seeking appointment of arbitrator must not be conflated with the limitation period for raising the substantive claims which are sought to be referred to an arbitral tribunal.” Applying the law laid down in these precedents to the facts of the present case, the Court observed that the notice invoking arbitration clause was issued by the Applicant only on 17.10.2022. Assuming that three years were to be calculated from the said date itself, the present application which was filed on 31.08.2023 was well within the period of limitation of three years as prescribed by Article 137 of the Limitation Act, 1963. Named Arbitrator Cannot Be Replaced Unless There Is Evidence Of Partiality Or Bias Against Them: Andhra Pradesh HC Case Title: M/s. Kranthi Grand DKNV Hospitalities...

Arbitration Monthly Digest: February 2025

Mohd Talha Hasan

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