Arbitration Cases Weekly Round-Up: 9th October- 15th October

Delhi High Court Whether Enforcement Of Foreign Arbitration Award Can Be Denied Due To Non-Stamping Of Arbitration Agreement? Delhi High Court To Examine Case Title: SIMPLOT INDIA LLC v. HIMALAYA FOOD INTERNATIONAL LIMITED Citation: 2023 LiveLaw (Del) 938 The Delhi High Court is set to examine whether the enforcement of a foreign arbitration award can be denied due to the non-stamping of the arbitration agreement. The bench of Justice Manoj Kumar Ohri has issued notice on a plea seeking to raise objection to the enforcement of the Singapore seated foreign arbitration award under Section 48 of the A&C Act. The award debtor raised objections to the enforcement of the foreign seated arbitration award on the ground of non-stamping of the arbitration agreement. It contended that the underlying arbitration agreement, being unstamped, is not considered "valid" under Indian law, which governs the agreement. It relied upon the recent judgment of the Constitution bench of the Supreme Court in N.N. Global, wherein the Court held that an unstamped arbitration agreement is deemed "unenforceable," "invalid," "bereft of life," "non-est," and cannot be "acted upon" by a Court at the stage of referring disputes under Section 11 of the Arbitration Act, to contend that the findings regarding the invalidity of an unstamped agreement should also apply to proceedings for the enforcement of foreign awards under Part – II of the Arbitration Act. Prolongation Compensation Can't Be Granted If The Contractor Didn't Reserve Claim For Compensation At The Time Of The EOT: Delhi High Court Case Title: IRCON INTERNATIONAL LIMITED V. DMRC Citation: 2023 LiveLaw (Del) 943 The Delhi High Court has held that no compensation can be awarded for the prolongation of the contract if the contractor did not reserve its right to such compensation at the time of the seeking Extension of Time (EOT). Justice Manoj Kumar Ohri's bench upheld the Arbitral Tribunal's interpretation. They ruled that the Tribunal's decision, which denied the prolongation cost due to the Contractor's failure to reserve this right during the EOT request, and because the EOT was granted without financial implications, is a plausible view which does not warrant intervention by the Court using its powers under Section 34 of the A&C Act. No Stamp Duty Is Payable On An Instrument Executed By, Or On Behalf Of, Or In Favour Of The Government, N.N. Global Not Applicable To Such Instruments: Delhi High Court Case Title: M/s SVK Infrastructures v. Delhi Tourism and Transportation Development Corporation Ltd Citation: 2023 LiveLaw (Del) 968 The Delhi High Court has held that no stamp duty is payable on an instrument which is executed by, or on behalf of or in favour the government. The bench of Justice Rekha Palli held that the recent judgment by the Constitution Bench of the Supreme Court in N.N. Global would have no application to an agreement executed by or on behalf or in favour of the government. It held that the Court exercising powers under Section 11 of the A&C Act would not refuse to appoint arbitrator once it ascertained that instrument falls within the exception created by the stamps act for government. The Court also held that once the entity which had executed the agreement containing arbitration clause has been acquired by another entity, the acquiring party would step in the shoes of the executing party, therefore, it can invoke the arbitration clause. Arbitration Clause Allowing One Party To Appoint 2/3rd Of Arbitral Tribunal Is Not Enforceable: Delhi High Court Case Title: Taleda Square Pvt Ltd v. Rail Land Development Authority Citation: 2023 LiveLaw (Del) 967 The Delhi High Court has held that an arbitration clause wherein one of the contracting party has the power to appoint the 2/3rd members of the arbitral tribunal and compels the other party to choose its nominee arbitrator from a narrow panel of only 5 names is not enforceable in law. The bench of Justice Rekha Palli held that a narrow panel of 5 arbitrator with a further power to the party which has drawn the panel to nominee 2/3rd members of the arbitral tribunal is against the principles of ‘counter-balancing’ as envisaged by the Apex Court in the case of Voestalpine Schienen. Court Exercising Powers Under Section 9 Of The A&C Act For Securing Amount In Dispute Draws Sustenance Broadly From The Principles Of Order XXXVIII Rule 5 Of CPC: Delhi High Court Case Title: Dr. Vivek Jain v. PrepLadder Pvt Ltd Citation: 2023 LiveLaw (Del) 964 The Delhi High Court has held that a Court exercising powers under Section 9 of the A&C Act to secure the amount in dispute or for ordering attachment before award draws sustenance broadly from the principles of Order XXXVIII Rule 5 of CPC. The bench of Justice Yashvant Varma has held that the under Section 9 of the A&C Act, the...

Arbitration Cases Weekly Round-Up: 9th October- 15th October

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