Supreme Court Half Yearly Digest 2023- Arbitration

12 months’ time limit under Section 29A Arbitration Act not applicable to international commercial arbitration. TATA Sons Pvt. Ltd. v. Siva Industries and Holdings Ltd., 2023 LiveLaw (SC) 39 : 2023 INSC 13 : (2023) 5 SCC 4212015 Arbitration Amendment not applicable though S.11 application was filed after it, if arbitration notice was issued pre-amendment. Shree Vishnu Constructions v. Engineer in Chief Military Engineering Service, 2023 LiveLaw (SC) 417 : 2023 INSC 508Arbitration agreement in unstamped contract which is exigible to stamp duty not enforceable: Supreme Court holds by 3:2 majority. N.N. Global Mercantile Pvt. Ltd. v. Indo Unique Flame Ltd., 2023 LiveLaw (SC) 343 : 2023 INSC 423Arbitration and Conciliation Act, 1996 - Supreme Court has reiterated that the courts ought not to normally interfere with the arbitral proceedings, especially till the time an arbitral award is not passed - The top court has deprecated the practice of filing applications in disposed of Special Leave Petitions (SLPs) in order to side-step the arbitration process, adding that the said applications must not be entertained by the court. Narsi Creation Pvt. Ltd. v. State of Uttar Pradesh, 2023 LiveLaw (SC) 325 : 2023 INSC 387Arbitration and Conciliation Act, 1996; Section 11 - Certified copy can be produced at the Section 11 stage only if it clearly indicates the stamp duty paid. If the same is not mentioned, the Court should not act on the said certified copy. N.N. Global Mercantile Pvt. Ltd. v. Indo Unique Flame Ltd., 2023 LiveLaw (SC) 343 : 2023 INSC 423Arbitration and Conciliation Act, 1996; Section 11 - The Apex Court has set aside the decision of the Delhi High Court where the Court had referred the parties to arbitration under Section 11(6) of the A&C Act, after the parties had entered into a Settlement Agreement which recorded that there were no subsisting issues pending between them. The Supreme Court held that the High Court should have exercised the prima facie test to screen and strike down the ex-facie meritless and dishonest litigation. Further, it ought to have examined the issue of the final settlement of disputes in context of the principles laid down in Vidya Drolia and Ors. vs. Durga Trading Corporation ((2021) 2 SCC 1 - The Supreme Court has ruled that while exercising jurisdiction under Section 11(6) of the A&C Act, the court is not expected to act mechanically, and that the limited scrutiny of the court at the pre-reference stage, through the “eye of the needle”, is necessary and compelling. NTPC Ltd v. SPML Infra Ltd; 2023 LiveLaw (SC) 287 : AIR 2023 SC 1974 : 2023 INSC 334 :(2023) 2 SCR 846Arbitration and Conciliation Act, 1996; Section 11 - the Court at the Section 11 stage is bound to examine the instrument and if found to be unstamped or insufficiently stamped the instrument is to be impounded at this stage itself. N.N. Global Mercantile Pvt. Ltd. v. Indo Unique Flame Ltd., 2023 LiveLaw (SC) 343 : 2023 INSC 423Arbitration and Conciliation Act, 1996; Section 11 (6) - Post amendment in 2015, the jurisdiction of the Court under Section 11(6) of the Arbitration Act is confined to examining whether an arbitration agreement exists between the parties – “nothing more, nothing less”. Under Section 11(6A) of the Arbitration Act, referral court is duty bound to consider the dispute/issue with respect to the existence of an Arbitration Agreement. (Para 5.2) Magic Eye Developers Pvt. Ltd. v. Green Edge Infrastructure Pvt. Ltd., 2023 LiveLaw (SC) 444 : AIR 2023 SC 2339 : 2023 INSC 528Arbitration and Conciliation Act, 1996; Section 11 (6) - The ‘pre-referral’ jurisdiction of Court under Section 11 (6) consists of two inquiries, (i) existence and validity of arbitration agreement; and (ii) non-arbitrability of dispute. The primary inquiry is about the existence and the validity of an arbitration agreement, which also includes an inquiry as to the parties to the agreement and the applicant’s privity to the said agreement. The said matter requires a thorough examination by the referral court. The Secondary inquiry that may arise at the reference stage itself is with respect to the non-arbitrability of the dispute. Both are different and distinct. So far as the first issue with respect to the existence and the validity of an arbitration agreement is concerned, as the same goes to the root of the matter, the same has to be to conclusively decided by the referral court at the referral stage itself. With respect to non-arbitrability of the dispute, the court at pre-referral stage may prima facie examine the arbitrability of claims. The review at the reference stage is done to sideline the cases where litigation must stop at the first stage. (Para 5.3) Magic Eye Developers Pvt. Ltd. v. Green Edge Infrastructure Pvt. Ltd., 2023 LiveLaw (SC) 444 : AIR 2023 SC 2339 : 2023 INSC 528Arbitration and Conciliation Act, 1996; Section 11 (6) - When the issue of ‘existence and validity of an arbitration agreement’ is raised at...

Supreme Court Half Yearly Digest 2023- Arbitration

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