Arbitration Cases Weekly Round-Up: 17 July To 23 July 2023

Calcutta High Court: 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. Delhi High Court: Non-Consideration Of Clause In Agreement: Can’t Say Opposed To Fundamental Policy Of Indian Law: Delhi High Court Case Title: National Highways Authority of India vs GVK Jaipur Expressway Private Limited The Delhi High Court has ruled that non-consideration of a clause of the Agreement executed between the parties, cannot be said to be an error made by the arbitral tribunal which is opposed to the fundamental policy of Indian law. The court added that the same also cannot render the arbitral award patently illegal if the view of the Arbitrator is a plausible one. The bench comprising Chief Justice Satish Chandra Sharma and Justice Subramonium Prasad was dealing with an arbitral award which was challenged on the ground that the Arbitrator had ignored the relevant clause of the Concession Agreement while passing the award. A ‘Medium’ Enterprise Can Approach MSEF Council If It Was A ‘Micro Or Small’ Enterprise At The Relevant Time: Delhi High Court Case Title: Sterlite Power Transmission Limited vs EPC Solutions LLP The High Court of Delhi has held that the relevant date under the MSMED Act is the date of agreement and additionally the date on which the goods and services were supplied, therefore, a ‘medium’ enterprise can maintain a claim before MSEFC if it was either a micro or a small enterprise at the relevant time. The bench of Justice Prathiba M. Singh held that any subsequent upgradation of enterprise from ‘micro or small’ to ‘medium’ would not be a bar to the maintenance of its claim before the MSEFC, if it fulfilled the criteria at the relevant time. The Court reiterated that MSMED Act, 2006 is a beneficial legislation for Micro, Small and Medium Enterprises and ought to be construed in a manner that is beneficial to such enterprises. Mere Grant Of Extension Of Time To Contractor Does Not Necessarily Mean That NHAI Was Responsible For The Delays: Delhi High Court Case Title: NHAI vs IRB Pathankot Amritsar Toll Road Ltd The High Court of Delhi has held that mere recommendation by Independent Engineer (IE) for Extension of Time (EOT) to the contractor does not necessarily mean the NHAI was responsible for the delays in the completion of the project work. The division bench of Justices Vibhu Bakhru and Amit Mahajan held that when the agreement between the parties provides for compensation and extension of concession period in favour of the contractor only in the eventuality of a material breach by NHAI, the arbitrator cannot award damages or grant extension of concession period, without first determining the issue of material breach of the agreement by NHAI, simply for the reason that the IE has recommended EoT in favour of the Contractor. Writ Against Order Under Section 16 Of A&C Act; Maintainable Only In Exceptional Cases: Delhi High Court Reiterates Case Title: IDFC First Bank Limited vs Hitachi MGRM Net Limited The High Court of Delhi has held that a writ petition against an order of arbitral tribunal rejecting an application under Section 16 of A&C Act is maintainable only in exceptional cases. The bench of Justice Prathiba M. Singh held in view of the Supreme Court judgment in Vidya Drolia, the disputes falling under RDB Act, 1993 would be non-arbitrable as the DRT would have the exclusive jurisdiction to decide ...

Arbitration Cases Weekly Round-Up: 17 July To 23 July 2023

Parina Katyal

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