Arbitration Cases Weekly Round-Up: 17 July To 23 July, 2022

Supreme Court: There Cannot Be Two Arbitration Proceedings With Respect To Same Contract/ Transaction: Supreme Court Case Title: M/S Tantia Constructions Limited v. Union Of India Citation: 2022 LiveLaw (SC) 624 Observing that it is of the "firm opinion that there cannot be two arbitration proceedings with respect to the same contract/transaction", the Supreme Court stated that when a dispute has earlier been referred to arbitration and an award was passed on the claims made, then it is "rightful" to refuse to refer to arbitration- in exercise of Section 11(6) of the 1996 Arbitration Act- a fresh arbitration proceeding sought to be initiated with respect to some further claims. Section 11(6A) Arbitration Act Does Not Prevent Courts From Considering Issue Of Arbitrability: Supreme Court Case Title: Indian Oil Corporation Limited vs NCC Limited Citation: 2022 LiveLaw (SC) 616 Despite the insertion of Section 11(6A) in the Arbitration and Conciliation Act 1996, the Courts are not denuded of the power to examine the issue of non-arbitrability and jurisdiction at the stage of considering application of appointment of arbitrators under Section 11, held the Supreme Court recently. Court While Deciding 'Section 11' Application Seeking Appointment Of Arbitrator Can Consider Whether Dispute Falls Within 'Excepted Clause' : Supreme Court Case Title: Indian Oil Corporation Limited vs NCC Limited Citation: 2022 LiveLaw (SC) 616 The Supreme Court held that, at the stage of deciding application for appointment of arbitrator, a Court can consider whether the dispute falls within the excepted clause. The Court observed that the question of jurisdiction and non-arbitrability can be considered by a Court at the stage of deciding an application under Section 11 of Arbitration and Conciliation Act if the facts are very clear and glaring. Bombay High Court: An Enabling Clause Does Not Constitute A Binding Arbitration Agreement Between The Parties: Bombay High Court Case Title: Derivados Consulting Pvt. Ltd. versus Pramara Promotions Pvt. Ltd. The Bombay High Court has ruled that once the parties have agreed to use the word 'may', the parties have conferred a discretion to enter into an arbitration agreement in the future; and that such an enabling clause does not constitute any binding arbitration agreement between the parties. The Single Bench of Justice G. S. Kulkarni held that the use of the word "may" does not bring about any arbitration agreement between the parties, when tested on the touchstone of Section 7(1) of the Arbitration and Conciliation Act, 1996 (A&C Act), which defines the arbitration agreement Calcutta High Court: No Claim Certificate Is Invalid If It Is A Pre-Condition To The Release Of Final Payment: Calcutta High Court Cast Title: West Bengal Tourism Development Corporation Ltd. v. Supratik Banerjee and Anr. The Calcutta High Court has held that a discharge voucher or No Claim Certificate would be invalid on account of 'Coercion' if it is submitted as a pre-condition to the release of final payment. The Bench of Justice Krishna Rao held that a situation where the employer denies the payment of dues to the contractor unless it submits an undertaking to the employer not to make any further claims would fulfil the ingredients of Section 15 of the Indian Contract Act and the obtained undertaking would be invalid. Delhi High Court: The Arbitrator Cannot Award A Lumpsum Amount As Against Specified Claims Without Adjudicating The Claims: Delhi High Court Case Title: Kanti Bijlee Utpadan Nigam Ltd. v. Paltech Cooling Towers & Equipments Ltd. Citation: 2022 LiveLaw (Del) 692 The High Court of Delhi has held that an award wherein a lumpsum amount is awarded against the specified claims without adjudication of the claims is unsustainable. The Bench of Justice Vibhu Bakhru held that an arbitral tribunal cannot award a lumpsum amount against specified claims of a party merely to meet the ends of justice. Non-Applicability Of Section 9 Of The A&C Act Can't Be Presumed If Parties Opted For Foreign-Seated Institutional Arbitration: Delhi High Court Case Title: Shanghai Electric Group Co. Ltd. v. Reliance Infrastructure Ltd. Citation: 2022 LiveLaw (Del) 683 The High Court of Delhi has held that merely because the parties have chosen a foreign-seated institutional arbitration under the UNCITRAL Law, they cannot be presumed to have entered into an agreement to exclude the applicability of Section 9 of the A&C Act as provided under the proviso to Section 2(2) of the A&C Act. The Bench of Justice Sanjiv Narula held that the words "an agreement to the contrary" appearing under Section 2(2) cannot be presumed or interpreted on the mere assertion of a party but the same must be clearly borne out of the agreement between the...

Arbitration Cases Weekly Round-Up: 17 July To 23 July, 2022

Parina Katyal

Tags