Arbitration Cases Monthly Round-Up: July 2023

Supreme Court Can Ineligible Person Appoint Arbitrator? Supreme Court Defers Hearing As Centre Is Considering Reforms To Arbitration & Conciliation Act Case Title: Central Organisation for Railway Electrification vs. M/s ECI SPIC SMO MCML (JV) A Constitution Bench of the Supreme Court on Wednesday decided to defer for two months the hearing of a reference which raises the issue whether a person, who is ineligible to be appointed as an arbitrator, can appoint an arbitrator. The matter was listed before a bench comprising Chief Justice of India DY Chandrachud, Justice Hrishikesh Roy, Justice PS Narasimha, Justice Pankaj Mithal, and Justice Manoj Misra. High Courts Calcutta High Court: Interim Relief Under The A&C Act Obtained Without Disclosing Material Evidence, Calcutta High Court Imposes Cost Of Rs. 50 Thousand On Each Petitioner Case Title: Omkar Tradecomm LLP vs Mayank Agarwal The High Court of Calcutta has held that a party approaching the Court for relief must do so with clean hands and is under an obligation to disclose all material facts that have bearing on the adjudication of the issues in the case. The bench of Justice Shekhar B. Saraf held that the doors of justice would be closed for litigants approaching the court with a case built on falsehood, fraudulent concealment or suppression of material facts. The Court recalled its earlier order wherein it had granted interim relief under Section 9 of the Arbitration and Conciliation Act, 1996 to a party that concealed material facts of the dispute from the Court at the time of seeking such relief. The Court imposed cost of Rs. 50 thousand on each of the petitioners. Finding Of The Tribunal Regarding The Existence Of The Arbitration Agreement Should Not Be Interfered With Unless It Is Manifestly Clear That There Was No Agreement: Calcutta High Court Case Title: Jaldhi Overseas PTE Ltd vs Steer Overseas Pvt Ltd The High Court of Calcutta has held that the Courts, while exercising powers under Section 48 of the A&C Act, cannot re-appreciate the evidence or substitute its view with that of the arbitral tribunal. It reiterated that the scope of judicial interference at the stage of enforcement of foreign award is limited to the grounds mentioned under Section 48 and the court is only required to make a preliminary determination. Party’s Right To Choose Arbitrator Cannot Be Revived Once It Is Surrendered To Court U/S 11(6) Arbitration Act: Calcutta High Court Case Title: Srei Equipment Finance Limited vs Seirra Infraventure Private Limited The Calcutta High Court has recently held that when a party forfeits its right to appoint an arbitrator in accordance with Section 11 of the Arbitration & Conciliation Act, 1996 (“Arbitration act”), then it cannot subsequently “trace back its steps” to revive such a right, for the substitution of a fresh panel of arbitrators, when the existing arbitrator becomes de jure/de facto unable to discharge their duties. Hearing Of Interim Application U/S 9(1) Arbitration Act Not Barred By Constitution Of Arbitral Tribunal If Court Has Already ‘Entertained’ It: Calcutta High Court Case Title: Jaya Industries vs Mother Dairy Calcutta & Anr. The Calcutta High Court has recently held that that the power of a Court to continue hearing an application for interim relief under Section 9(1) of the Arbitration and Conciliation Act, 1996, (“1996 Act”) would not be “fettered” under Section 9(3) after the constitution of an arbitral tribunal, if the court has already entertained the application. A single-judge bench of Justice Moushumi Bhattacharya held, that while Section 9(3) barred the Court from taking up any interim application after the due constitution of the arbitral tribunal, the same could not fetter the power of a Court to continue hearing an application, which it had already entertained prior to constitution of such a tribunal. Arbitrator Appeared As Counsel For An ‘Affiliate Company’ Of The Claimant, Award Liable To Be Set Aside : Calcutta HC Case Title: Gopaldas Bagri vs C&E Ltd The High Court of Calcutta has held that an arbitration award is liable to be set aside for violation of Sections 12(1), 12(2) and 12(5) of the Arbitration and Conciliation Act, 1996 when the arbitrator appeared in court for an ‘affiliate company’ of the claimant during the pendency of the arbitration without disclosing such an engagement to the respondent. The bench of Justice Rajshekhar Mantha held that Section 12(2) of the A&C Act cast a continuous duty on the arbitrator to remain neutral and continue to disclose to the parties any acts or omissions that are likely to fall foul of the mandate under Section 12, in the course of the Arbitration.Court May Permit Award-Holder To Withdraw Security Deposited By Award-Debtor Pending Challenge To Arbitral Award U/S 34: Calcutta High Court Case Title: The State of West Bengal & ...

Arbitration Cases Monthly Round-Up: July 2023

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