ARBITRATION: END SEMS

HISTORICAL EVOLUTION........................................................................................ 1

MEANING OF ‘ARBITRATION’.................................................................................. 4

SECTION 7 / ARBITRATION AGREEMENT..................................................................5

SECTION 4 / WAIVER............................................................................................. 7

SECTION 5 / EXTENT OF JUDICIAL INTERVENTION....................................................8

ASYMMETRICAL CLAUSES...................................................................................... 8

SECTION 8 / REFERENCE TO ARBITRATION..............................................................9

INTERNATIONAL COMMERCIAL ARBITRATION.........................................................10

ARBITRABILITY.................................................................................................... 11

SECTION 9 / INTERIM RELIEF BY COURTS.............................................................13

SECTION 17 / INTERIM RELIEF BY TRIBUNAL........................................................15

SECTION 10 / NUMBER OF ARBITRATORS..............................................................16

SECTION 11 / APPOINTMENT OF ARBITRATORS......................................................17

SECTION 12 / GROUNDS FOR CHALLENGE............................................................18

SECTION 13 / CHALLENGE PROCEDURE................................................................19

SECTION 16 / COMPETENCE-COMPETENCE...........................................................20

SECTION 20 / PLACE OF ARBITRATION..................................................................21

SECTION 28 / RULES APPLICABLE TO SUBSTANCE OF DISPUTE...............................22

SECTION 29 / DECISION MAKING.........................................................................23

SECTION 31 / FORM & CONTENTS OF AWARD.......................................................24

SECTION 34 / SETTING ASIDE.............................................................................. 25

SECTION 36 / FINALITY OF AWARD.......................................................................27

SECTION 37 / APPEALS........................................................................................ 28

SECTION 44....................................................................................................... 29

SECTION 45....................................................................................................... 30

SECTION 47....................................................................................................... 31

MISCELLANEOUS................................................................................................ 32
CONCEPT PARTICULARS
Historical Evolution
Early Arbitration Law Inspired by the British Arbitration Act (1898),
(1899) applied only in presidency towns; arbitration
provisions were previously included in the CPC.

Arbitration Act, 1940 Focused on domestic arbitration, criticized for

inefficiency and complexity.

Gurunanak “Interminable, time consuming, complex and

Foundations v. Ratan expensive court procedures impelled jurists to
Singh & Sons, 1981; search for an alternative forum, less formal, more
Trustees of Port of effective and speedy for resolution of disputes
Madras v. avoiding procedural claptrap and this led them to
Engineering Arbitration Act, 1940 (Act for short). However, the
Construction Corp., way in which the proceedings under the Act are
1995 conducted and without an exception challenged in
courts, has made lawyers laugh and legal
philosophers weep. Experience shows and law
reports bear ample testimony that the proceedings
under the Act have become highly technical
accompanied by unending prolixity, at every stage
providing a legal trap to the unwary. Informal
forum chosen by the parties for expeditious
disposal of their disputes has by the decisions of
the courts been clothed with legalese of
unforeseeable complexity.”

Arbitrations (Protocol Enacted to enforce the Geneva Convention, 1927.

and Conventions) Act,
1937
Foreign Awards Enacted to align with the New York Convention,
(Recognition and 1958.
Enforcement) Act,
1961
Criticism of the 1940 Time-consuming, complex, and expensive court
Act procedures defeated the purpose of arbitration as
an informal, expeditious dispute resolution
mechanism.

Need for Reform Post-1991 LPG reforms (Liberalization,

Privatization, Globalization) emphasized ease of
doing business, ending government monopolies,
and creating foreign-investor-friendly laws.

Arbitration and Objectives

Conciliation Act, 1996  Covers both international arbitration and
conciliation along with domestic
arbitration, but focuses solely
on international commercial arbitration,
excluding international investment
arbitration.
 Adopts the UNCITRAL Model Law for
arbitration processes.
 Domestic arbitration is always commercial;
there is no concept of domestic investment
arbitration.
 Types of International Arbitration:
› Commercial Arbitration: Disputes
between two private parties. Even if
one party is a government entity, it is
classified as commercial due to the
nature of the dispute.
› Investment Arbitration: Disputes
between a private party and a state,
often concerning the state's failure to
meet obligations. These are inter-state
dispute settlements, unlike
commercial arbitration, which is
contract-driven.
 Arbitration awards are enforceable as a
decree of the court.
Date of Commencement
On January 16, 1996, the President promulgated an
ordinance, which was brought into force on January
25, 1996, and later replaced by the Act on August
22, 1996. The critical date for enforcement was
decided in M/s Fuerst Day Lawson Ltd. v. Jindal
Export Ltd., where the court relied on Section 5 of
the General Clauses Act to determine January 25,
1996, as the effective date. This decision was based
on the continuity of the ordinance provisions, which
were identical to the Act and remained in force
until repla
ced.
Meaning of ‘Arbitration’
Sec. 2(1)(a) “arbitration” means any arbitration whether or not
administered by permanent arbitral institution

Halsbury’s Laws of Arbitration involves a dispute or difference referred

England to not less than two parties for determination by a
person(s) other than the court, in a judicial manner.

Nordon Regional Arbitration is private sector litigation where the

Health Authority v. arbitrator finds facts, applies the law, and grants
Derek Crouch, 1984 relief to one or more parties.

Ronald, Bernstein Arbitration occurs when parties agree to refer

Handbook of disputes to an impartial person(s) in a legally
Arbitration Practice binding manner, leading to a decision called an
“award”.

Russel on Arbitration Arbitration is defined as the reference of disputes

by parties to a tribunal of their choice, which is not
a court.
Section 7 / Arbitration Agreement
This provides for the meaning, essentials, etc. of an
Sec 7 A&C Act arbitration agreement.

Wellington Old position: the court will look at the arbitrability

Associations Ltd. v. of the matter first and then refer it to the tribunal.
Kirit Mehta
Separability: On how arbitration agreements are
separable from the main contract (as given under
NN Global Mercantile
Sec 16) and how the arbitral tribunal has the
v. Indo Unique Flame
competence to decide on its own jurisdiction.

An arbitration agreement requires:

(1) a present or future dispute related to a
contemplated matter,
(2) the parties' intention to resolve the dispute
through a private tribunal
(3) a written agreement to be bound by the
tribunal's decision, and
(4) mutual agreement (ad idem). Importantly, the
term “arbitration” need not be explicitly
Bihar State Mineral mentioned in the agreement.
Development Section 7 states that the dispute need not be
Corporation v. Encon anticipated in the future; parties can agree to
Builders arbitration even after a dispute has arisen if it
defines their legal relationship, whether
contractual or non-contractual.

While the intention to arbitrate must be clear, if the

agreement is vaguely drafted, the court's role is to
interpret the parties' intent. However, agreements
to arbitrate must be in writing and cannot be made
verbally.

KK Modi v. KN Modi “(1) The arbitration agreement must contemplate

that the decision of the tribunal will be binding on
the parties to the agreement, (2) That the
jurisdiction of the tribunal to decide the rights of
parties must derive either from the consent of the
parties or from an order of the Court or from a
statute, the terms of which make it clear that the
process is to be an arbitration, (3) The agreement
must contemplate that substantive rights of parties
will be determined by the agreed tribunal, (4) That
the tribunal will determine the rights of the parties
in an impartial and judicial manner with the
tribunal owing an equal obligation of fairness
towards both sides, (5) That the judgment of the
parties to refer their disputes to the decision of the
tribunal must be intended to be enforceable in law
and lastly, (6) The agreement must contemplate
that the tribunal will make a decision upon a
dispute which is already formulated at the time
when a reference is made to the tribunal.”

Essential Ingredients:
1. The parties should have entered into a valid
and binding agreement.
Jayant N. Seth v.
2. Such an agreement can be entered as a
Gyaneshwar
clause in a contract or in a separate
Apartment
agreement.
Cooperative Housing
3. Such an agreement should be in writing if it
Society
is mentioned in a document and signed by
the parties.

The appellant argued that the clause in question

did not amount to an arbitration agreement. The
court, however, examined the nature of the
agreement and the correspondence between the
Ganga Pollution
parties, finding that there was an implied
Control Unit, Jal
arbitration agreement. The court noted that the
Nigam v. Civil Judge,
respondent's letter from 1992, indicating that
Allahabad
disputes would be settled through arbitration, was
received by the appellant, and subsequent conduct
by both parties implied acceptance of arbitration.
Section 4 / Waiver
“A party who knows that—
(a) any provision of this Part from which the parties
may derogate, or
(b) any requirement under the arbitration
agreement,

Sec. 4 A&C Act has not been complied with and yet proceeds with
the arbitration without stating his objection to such
non-compliance without undue delay or, if a time
limit is provided for stating that objection, within
that period of time, shall be deemed to have waived
his right to so object.”

“waiver is the species of doctrine of acquiescence

which denote implied consent or failure on part of
person to not assert or exercise his right for
Russel on Arbitration inordinate delay for long time or undue delay and
chose not to raise objection, it is waiver of right to
object.”

The Supreme Court rejected the State of

Rajasthan's late objection regarding a conflict of
interest after an unfavourable arbitral award. The
State had initially failed to raise the issue of the
arbitrator's prior representation of a company in
State of Rajasthan v. unrelated matters during the arbitration process.
Uri Construction The conflict was only raised after the award was
Company issued. The Court ruled that objections cannot be
entertained at the enforcement stage if they were
not promptly raised during the arbitration
proceedings, as the State had ample opportunity to
address the issue earlier.

In this case, it was held that a party who knows

that a requirement under arb agreement has not
been complied with and still proceeds with the arb
without raising an objection as soon as possible, is
BSNL v. Motorola
deemed to waive his right to object. This is about
the provisions and terms stipulated under arb
agreement.

If the arbitral tribunal finds that the parties had

N. Chellappan v. actual or constructive knowledge of the grounds for
Secretary, Kerala objection during the proceedings but chose to
State Electricity remain silent and proceed, they are barred from
Board raising such objections after the award is passed.
Section 5 / Extent of Judicial Intervention
“Notwithstanding anything contained in any other
law for the time being in force, in matters governed
by this Part, no judicial authority shall intervene
except where so provided in this Part.”
Sec. 5 A&C Act
Courts can intervene only where it has been
expressly provided under Part I A&C Act.

Section 5 of the Arbitration Act does not affect the

application of Section 8, which is the only provision
allowing referral of a dispute in a pending suit to
arbitration.

A matter should not be referred to arbitration if: (1)

the parties have not applied to refer the dispute to
Sukanya Holdings
arbitration, (2) the application is not made before
Pvt. Ltd. v. Jayesh
submitting the first statement on the dispute's
Pandya
substance, or (3) the application is not
accompanied by the original or a certified copy of
the arbitration agreement. Therefore, if these
conditions are not met, the Civil Court retains
jurisdiction to decide the dispute, and the
Arbitration Act does not override this.

This is the HK Court decision on whether an

Dickson Holding
arbitration agreement captures company law
Enterprise v. Moravia
/fiduciary duty related questions.
CB 2019 (HK)
Asymmetrical Clauses
The Delhi High Court held that an asymmetric
arbitration clause is not valid (not even an
Union of India v.
arbitration agreement) until the point at which the
Bharat Engineering
party exercises its option to arbitrate – prior to
Corporation
that, there is a lack of mutuality.

The Calcutta High Court expressly declined to

adopt the reasoning of the Delhi High Court and
New India Assurance held that an asymmetric arbitration clause
v. Central Bank of constitutes a valid arbitration agreement from the
India outset, albeit enforceable only by the party with an
option to arbitrate.

An arbitration agreement that allows one party to

unilaterally withdraw from the arbitration
proceedings is legally invalid. Such an agreement
Tata Capital Finance
lacks mutuality, which is a fundamental
Ltd v. Sri Chand
characteristic of any valid arbitration agreement.
Construction and
Both parties must have an equal commitment to the
Apartments
arbitration process for the agreement to be
enforceable.
Section 8 / Reference to Arbitration
In this case, one party argued that the bank
guarantees are independent contracts and should
not be subject to the arbitration agreement. The
court stated that the arbitration clause in the
Consortium Agreement is broad enough to
encompass all disputes, including the allegations of
PWH Analgant v. fraud made by Damodar.
Damodar Ropeway
The party was not a party to the bank guarantees,
under which the dispute arose. This party
contended that as a non-signatory to the bank
guarantees, arbitration cannot be initiated against
it.

Section 8 of the Arbitration Act is mandatory,

requiring the court to refer parties to arbitration if
an arbitration agreement exists. Once the court
refers the matter to arbitration, nothing remains to
be decided in the original action or appeal.

There is no provision for staying the court

proceedings until the arbitration concludes or the
award becomes final. All subsequent rights,
P Anand Gajapathy obligations, and remedies of the parties are
Raju v. PVG Raju governed by the new Act, including the right to
challenge the arbitration award. Challenges to the
award must be made to the court defined in clause
(e) of Section 2 of the Act, not the court where the
Section 8 application was filed.

Filing an application under Section 8 simply

informs the court that the dispute is subject to an
arbitration agreement.

Concurrent Proceedings
The Supreme Court stated, while taking note of the
New York Convention, how concurrent proceedings
can occur.

The rule states that a plea of lis alibi pendens (the

Tractor Export v. pendency of a suit elsewhere) will not automatically
Tarapore and lead to a stay of proceedings unless the defendant
Company can demonstrate actual vexation. The defendant
must prove that pursuing both actions
simultaneously is oppressive or embarrassing. This
burden of proof is challenging to meet, especially if
the plaintiff can show that there is some material
advantage in pursuing each action separately.
International Commercial Arbitration
“international commercial arbitration” means an
arbitration relating to disputes arising out of legal
relationships, whether contractual or not,
considered as commercial under the law in force in
India and where at least one of the parties is—
(i) an individual who is a national of, or habitually
resident in, any country other than India; or
Sec. 2(1)(f)
(ii) a body corporate which is incorporated in any
country other than India; or
(iii) 2*** an association or a body of individuals
whose central management and control is exercised
in any country other than India; or
(iv) the Government of a foreign country;

TVM Infrastructure Clarified that the place of incorporation decides

Pvt Ltd v. U E jurisdiction, even if central management and
Development India control is from outside India.
Pvt Ltd (2008)
Bhatia International Held that Part I of the Arbitration Act applies to
v. Bulk Trading SA ICA seated outside India unless expressly excluded
(2002) by the parties.

BALCO v. Kaiser Overruled Bhatia International, stating that Part I

Aluminium & Co. of the Act does not apply to ICA seated outside
(2010) India unless parties expressly agree to its
applicability.

Meaning of ‘Commercial’
R M Investment and Stated that ‘commercial’ should be broadly
Trading Co. Pvt Ltd v. construed, considering the diverse activities
Boeing Co. (1994) integral to modern international trade.

Fatehchand Himmat Defined ‘commercial’ as services or activities that

Lal v. State of act as lubricants for the wheel of commerce in the
Maharashtra (1977) modern business environment.

Kamini Engineering Emphasized giving the widest possible meaning to

Corp Ltd. v. Societete ‘commercial’ in light of the purpose of the
DE Traction Et arbitration act.
D’Electricite (1963)
Arbitrability
Booz Allen & Court refused to refer the matter to arbitration.
Hamilton v. SBI Home Case involved a mortgage agreement.
Finance
Mortgages can only be enforced by:
1) Foreclosure
2) Sale of property, both requiring court
intervention.
- Dispute deemed non-arbitrable.
- Key Observations:
3) Arbitrability depends on the nature of rights:
a. Right in rem (not arbitrable) vs. Right in
personam (can be arbitrable).
b. Specific legislation overrides arbitration.
4) Valid arbitration agreement cannot override
disputes categorized as right in rem.
5) Courts assess whether issues can be referred
to arbitration.

N. Radha Krishnan v. - Fraud and financial malpractice cases with

M.S. Maestro criminal repercussions are non-arbitrable.
Engineers (2010) - Such matters must be resolved in court and
cannot be referred to arbitration.

Swiss Timing Ltd. v. - Held for the first time that fraud allegations can
Organising be determined by arbitration if an arbitration
Committee, agreement exists between the parties.
Commonwealth - However, this decision lacks clarity and has not
Games (2013) been conclusively established as precedent.

The Supreme Court of India addressed a dispute

concerning media rights for the Indian Premier
League (IPL). The parties had entered into a
Facilitation Deed, which included an arbitration
clause specifying that any disputes would be
resolved through arbitration under the
International Chamber of Commerce (ICC) in
Singapore. When MSM Satellite alleged that the
Facilitation Deed was void due to fraud and
misrepresentation, they sought to prevent
World Sport Group arbitration proceedings.
(Mauritius) v. MSM
Satellite (Singapore) The Supreme Court applied the doctrine of
severability, which treats the arbitration clause as
an independent agreement separate from the main
contract. The Court held that allegations of fraud
pertaining to the main contract do not invalidate
the arbitration agreement itself. Consequently, the
Court referred the matter to arbitration,
emphasizing that such disputes should be resolved
by the designated arbitral tribunal as per the
parties' agreement.

A Ayyaswamy v. A The Supreme Court addressed the arbitrability of

disputes involving fraud. The Court distinguished
between criminal and civil fraud. Criminal fraud,
being against the state, cannot be resolved through
arbitration, while civil fraud, involving disputes
between individuals, can be referred to arbitration.
The case introduced the concept of "serious fraud,"
which includes instances where the fraud is so
fundamental that it vitiates the entire contract,
affecting its validity or enforceability, or
undermines the arbitration agreement itself
Paramasivam through elements like deceit or coercion.
Additionally, serious fraud may involve public
interest or criminal elements, or be so complex and
severe that it necessitates judicial intervention for
thorough examination of evidence, witnesses, and
legal issues, which arbitral tribunals are less
equipped to handle. However, in this case, the
Court determined that the alleged fraud was not
serious enough to preclude arbitration and referred
the matter to the arbitral tribunal.
Section 9 / Interim Relief by Courts
The parties can apply for interim measures to the
Sec 9 A&C Act court.

It was held that a party is entitled to interim

protection if the action of the other party is either
Baby Arya v. Vidyut
in breach of the term of the agreement or prevents
Board
equity, fair play and natural justice.

It first talks about sine qua non before invoking

Punj Lloyd
Section 9. The existence of the arb agreement or an
Limited v.
arbitral clause is the sine qua non for the
Valentine
contracting parties to refer disputes to arb and
Maritime
avail from the court any interim relief under this
(Mauritius
Section.
) Limited
Pre- The court must consider several factors before
Requisite issuing an order to refer a dispute to arbitration.
s for  First, it should determine whether the dispute
Hari
Invocatio relates to the subject matter of the contract
Finance
n covered by the arbitration agreement or falls
Limited v.
outside its scope.
ATV
 Second, there must be a clear intention by the
Project
applicant to pursue arbitration proceedings.
India
 Third, the subject matter of the dispute must
Limited
fall within the original civil jurisdiction, both in
terms of pecuniary and territorial limits.

To invoke Section 9, the pendency of arbitral

proceedings is not required. The court can grant
Globe Congeneration relief at three stages: before arbitration, during
Power Limited vs Sri arbitration, and after an arbitral award has been
Hiranyakeshi passed but not yet enforced. Thus, the pendency of
Sahakari Sakkere arbitration proceedings is not a prerequisite for the
court to exercise its powers under this section.

Section 9 of the Act pertains solely to interim

measures provided by the court. It is not within the
court's scope under this section to investigate the
Narayan Sahay
claims and counterclaims made by both parties
Agrawal v. Santosh
concerning the arbitrators' custody. The court does
Rani
not have the authority to examine the merits of the
case when deciding on interim measures.

Nav Bharat Ferro The court held that interim relief under Section 9
Alloy Ltd. v. should be exercised sparingly and only when there
Continental Float is a clear necessity to protect the subject matter of
Glass Ltd., 1998 the dispute. Mere apprehension or the possibility of
asset disposal is not enough to warrant such
injunctions. Strong evidence is required to justify
the necessity for protection through interim relief.

NHAI v. In this case involving a government-private

Bhubaneshwar construction contract, the private party breached
Expressway Pvt. Ltd., the contract, leading the government to enforce a
2021 bank guarantee. The private party sought interim
relief under Section 9 to stay the enforcement of the
bank guarantee. The court refused, stating that a
bank guarantee is a separate agreement between
the bank and beneficiary, unrelated to the
contractual matters. Hence, Section 9 powers could
not be applied.

SR House Pvt. Ltd. v. The court emphasized that while granting interim
Arcelor Mittal Nippon measures under Section 9, it must consider whether
Steel India Ltd., 2022 the applicant has a good prima facie case, whether
the balance of convenience favors the relief sought,
and whether the applicant has approached the
court with reasonable expedition.

Mann Bhupinder The court observed that when an arbitral tribunal is

Singh Atwal v. Neeraj constituted, interim measures should be granted by
Kumar Pal Shah, the tribunal rather than the court to avoid overlap.
2019 In this case, a Section 9 application was filed
simultaneously with the tribunal's constitution, and
the court refrained from granting relief, deeming it
more appropriate for the tribunal.

Hero Wind Energy The court held that when disputes are already
Pvt. Ltd. v. INOX pending before an arbitral tribunal, petitions under
Renewable Ltd. Section 9 are not maintainable. It reaffirmed that
arbitral tribunals should handle interim reliefs in
such cases, respecting the tribunal's jurisdiction
and minimizing court intervention.

M Tech Solution v. The court held that an order provided under Section
Pelit Solutions Pvt. 9 of the Arbitration Act can be applied or enforced
Ltd. like any other court order issued under other laws.
If a party wilfully disobeys or fails to comply with
the order, the aggrieved party can initiate civil
contempt proceedings under Section 2(b) of the
Contempt of Courts Act, 1971, which prescribes
maximum punishments under the Act.

Essar House Pvt. Ltd. The court ruled that the provisions of the CPC are
v. Arcelor Mittal not binding on proceedings under Section 9 of the
Nippon Steel India Arbitration Act, and mere technical errors cannot
Limited be used to withhold relief. The court must evaluate
whether the applicant has a good prima facie case,
whether the balance of convenience favors granting
the relief, and whether the applicant has
approached the court with reasonable expedition.
Section 17 / Interim Relief by Tribunal
Sundaram Finance v. The Supreme Court held that while Section 17 of
MS NTPC India Ltd., the Arbitration Act provides arbitral tribunals the
AIR 1999 SC 565 power to pass interim orders, these orders are not
+ directly enforceable like court orders. To enforce
MD Army Welfare such orders, parties must approach the court,
Housing Association thereby reducing the effectiveness of this provision.
v. Sumangal Services This legal position existed prior to the 2015
Pvt. Ltd., AIR 2004 SC amendments to the Arbitration Act.
1344
SBI v. Ericsson India The court ruled that arbitral tribunals do not have
Pvt. Ltd., 2018 the authority to pass interim orders against third
parties who are not part of the arbitration
proceedings. Such interim orders are limited to
parties directly involved in the dispute.

Amazon.com v. Future This case arose when Future Retail entered into a
Retail, 2021 deal with Reliance, violating its contractual
agreement with Amazon, which included a
restriction on dealing with Amazon's competitors
and a right of first refusal clause. The arbitration
agreement between Amazon and Future Retail
provided for arbitration under SIAC, which
included provisions for an emergency arbitrator.
The emergency arbitrator issued a stay on the
Future-Reliance deal, but Future Retail proceeded
regardless. Amazon sought enforcement of the
emergency arbitrator’s award in the Delhi High
Court under Section 17(2) of the Arbitration Act.
The Delhi HC ruled in favour of Amazon, and the
matter was taken to the Supreme Court.
Section 10 / Number of Arbitrators
(1) The parties are free to determine the number of
arbitrators, provided that such number shall not be
an even number.
Sec. 10 (2) Failing the determination referred to in sub-
section (1), the arbitral tribunal shall consist of a
sole arbitrator.

MMTC Ltd. v. Starlite The Supreme Court clarified that Section 7 does
Industries India Ltd., not mandate a specific number of arbitrators, and
AIR 1997 SC 605 an arbitration agreement cannot be invalidated
solely because it specifies an even number of
arbitrators. The two arbitrators, as per the
agreement, will appoint an umpire, thereby
satisfying the requirements of Section 10.

Sri Venkateshwara The court held that while parties are free to
Construction determine the number of arbitrators, the number
Company v. Union of cannot be even. If parties fail to specify a valid
India, AIR 2001 number, the arbitral tribunal will be constituted by
a sole arbitrator as per the provisions of the
Arbitration Act.

Sime Darby The court clarified that where the arbitration

Engineering SDN v. clause is silent about the number of arbitrators,
Engineering India Section 10(2) applies, and only one arbitrator
Ltd., AIR 2009 SC should be appointed. References to "arbitrators" in
3158 other clauses of the agreement will not override the
intention of the parties as expressed in the
arbitration clause.

City Bank NA v. PLC It was held that Section 10(2) applies in cases of
Marketing, 2008 Arb international commercial arbitration where the
WLJ 12 SC agreement does not specify the number of
arbitrators. In such cases, a sole arbitrator must be
appointed. This applies even when the petitioner
requests a sole arbitrator and the respondent
requests three arbitrators.

Harish Chinubhai The court ruled that Section 10 mandates that an

Shah v. Rajesh arbitral tribunal cannot consist of an even number
Prahhakar Jhaveri, of arbitrators. Where two arbitrators were
2004 1 Arb LR 536 appointed under a direction by the Chief Justice to
appoint a presiding arbitrator but failed to do so,
and instead proceeded with the arbitration
themselves, their actions were deemed illegal as
the tribunal's constitution did not comply with the
Arbitration Act.
Section 11 / Appointment of Arbitrators
Appointment of arbitrators.
Sec. 11
UOI v. BESCO Ltd., The Supreme Court held that even if an arbitrator
2017 SC is specified in the arbitration agreement, the court
can appoint an independent arbitrator if the
circumstances so warrant.

BSNL Ltd. v. Motorola Once the 30-day period for appointment of an

India Pvt. Ltd., 2008 arbitrator expires and a petition under Section 11
is filed, the parties lose the right to appoint
arbitrators. The court acquires jurisdiction to make
the appointment.

Kamla Solvent v. The court clarified that when an arbitrator is

Manipal Finance specifically named in the arbitration agreement,
Corporation Ltd., Section 11 of the Arbitration Act is not attracted.
2001 (Madras) The court does not have jurisdiction to entertain
petitions for the appointment of a different
arbitrator.

Indian Oil The court’s role under Section 11 is limited to

Corporation Ltd. v. determining the existence of an arbitration
M/s SPS Engineering agreement. It does not have the authority to assess
Ltd., 2011 SC the merits of the case, such as whether claims are
barred by res judicata. The removal of Section
11(6A) in 2019 did not change the court’s
discretion to examine the arbitration agreement,
but it cannot be compelled to do so.

NCC Ltd. v. Indian Oil The removal of Section 11(6A) restored the court's
Corporation Ltd., broader discretion under Section 11. Parties
2019 SC argued that the earlier insertion of 6A had
narrowed the scope of the court’s powers in
arbitration matters.

M/s BK Sons The court held that it acquires jurisdiction under

Infrastructure Pvt. Section 11(6) as soon as either party defaults in
Ltd. v. Managing adhering to pre-arbitral or arbitral procedures
Director, NHIDCL, outlined in the contract.
2024 Delhi
Rajkumari Taneja v. The court clarified that its role under Sections
Rajendra Kumar & 11(5) and 11(6) is to ensure the existence of an
Ors., 2023 arbitration agreement and confirm that the petition
is filed within three years from the service of notice
under Section 21, which marks the commencement
of arbitral proceedings.

Gujarat Urja Nigam The Supreme Court held that disputes between
Ltd. v. Essar Power licensees and generating companies fall under
Ltd., 2008 Section 86(1)(f) of the Electricity Act, 2003, which
prevails over the Arbitration and Conciliation Act
due to its status as a special law. Other disputes not
covered by the Electricity Act are governed by
Section 11 of the Arbitration Act.

Garware Wall Ropes The court ruled that instruments not bearing stamp
Ltd. v. Coastal Marine duty must be impounded and referred to the
Constructions and appropriate authority to assess and resolve issues
Engineering Ltd., related to stamp duty and penalties. Once stamp
2009 duty is paid, the parties can bring the instrument to
the High Court for adjudication under Section 11.

NN Global Mercantile The Supreme Court held that the lack of proper
v. Indo Unique Flames stamping or inadequate stamping of a contract
Ltd., 2021 does not invalidate the arbitration agreement.
Arbitration can proceed regardless of stamping
deficiencies.
Section 12 / Grounds for Challenge
Goyal Construction The court held that the arbitrator incorrectly
Co. Pvt. Ltd. v. ICAI believed that disclosure beyond the aspects
outlined in Schedule VI of the Arbitration Act was
unnecessary. It emphasized that merely complying
with the primary requirements of Schedule VI was
insufficient. The court directed arbitrators to
provide comprehensive disclosure as mandated by
Schedule VI.

Manish Anand v. The court ruled that even if an arbitrator’s

FITJEE Ltd., 2018 disclosure does not fully conform to the
(Delhi) requirements of Schedule VI of the Arbitration Act,
as long as it addresses the most vital aspects of the
schedule, the arbitrator’s mandate cannot be
terminated. This judgment highlighted the
importance of material compliance over strict
formal compliance with Schedule VI.

TRF Ltd. v. Energo The court held that once an arbitrator becomes
Engineering Project ineligible by operation of law, they lose the
Ltd., 2007 authority to nominate another arbitrator. It is
legally untenable for a statutorily ineligible person
to appoint an arbitrator. The court emphasized that
when the foundation of the arbitration process
collapses, its superstructure inevitably fails. This
principle applies particularly in cases involving
three arbitrators.
Section 13 / Challenge Procedure
Sec. 13
Konkan Railway Corp. The Supreme Court held that when an arbitrator is
Ltd. v. Rani appointed by the Chief Justice or their designate
Constructions Pvt. under Section 11, a party may challenge the
Ltd., 2002 SC arbitrator's impartiality or independence. Such a
challenge must be made by following the procedure
laid out in Section 13 of the Arbitration Act.

Ram Sahai Sheduram The court ruled that if a party learns of an

v. Hari Chandra arbitrator's relationship with one of the parties
Dulichand Ji, 1963 after the reference, it must promptly raise the issue
MP with the arbitrator and request them not to
proceed. However, if the party continues to
participate in the arbitration after this discovery, it
cannot later use the relationship as a ground to set
aside the award.
Section 16 / Competence-Competence
Sec. 16
Vipul Agrawal v. Atul The court held that after an award is made and
Kanodia and objections regarding lack or excess of jurisdiction
Company, AIR 2003 are rejected, the aggrieved party can challenge the
ALL 280 award under Section 34. The award can be set
aside on the grounds that the objections were
wrongly rejected.

Babur Ali v. Union of The Supreme Court upheld the constitutional

India, 2000 2 SCC validity of Section 16. The fact that jurisdictional
178 objections can only be reviewed by the court after
the award is passed does not make the award
immune from judicial scrutiny.

SBP and Company v. The Supreme Court clarified that Section 16(6)
Patel Engineering aims to prevent delays and misuse of the right to
Ltd., 2005 8 SCC 618 approach courts after every jurisdictional objection.
Sections 16(5) and 5 together ensure that
arbitration proceedings are not unnecessarily
stayed and the legal framework is clear and
efficient.

McDermott If the arbitral tribunal rejects a jurisdictional

International Inc. v. challenge, it can proceed with the award, which is
Burn Standard Co. then challengeable under Section 34. If the court
Ltd. & Ors., 2006 11 accepts the challenge, the decision can be appealed
SCC 181 under Section 37.

Grid Corporations of The court held that arbitral tribunals are limited to
Odisha Ltd. v. issues referred to them. They cannot decide
Balasore Technical matters beyond the terms of reference or expand
School the scope of arbitration. This principle prevents the
tribunal from exceeding its jurisdiction.

Delhi Development The court reaffirmed that arbitral tribunals cannot

Authority v. R S decide issues beyond the terms of reference.
Sharma and Special tribunals like arbitral tribunals have limited
Company, New Delhi, jurisdiction and cannot enlarge the scope of the
2008 reference.

Authority of India The court held that if a jurisdictional plea is not

Ltd. v. M S Keti raised before the arbitrator as provided under
Constructions Ltd., Section 16, it cannot be raised later in proceedings
AIR 2007 SC (SUPP) under Section 34 to set aside the award.
378
Chloro Controls Pvt. The court ruled that if a dispute is not within the
Ltd. v. Severn Trend purview of an arbitral tribunal, courts must decline
Water Purification jurisdiction unless the arbitration agreement is
Scheme, 2012 SC 187 patently void, inoperative, or incapable of being
performed.

Ajay Madhu Sudhan The court examined grounds for involving non-
Patel v. Jyotindra S. signatories to arbitration agreements, highlighting
Patel, 2004 SC 2597 that specific conditions must be met for such
inclusion.
Section 20 / Place of Arbitration
Sec. 20
PASL Wind Solution The Supreme Court held that parties to an
Pvt. Ltd. v. GE Power arbitration agreement have the autonomy to choose
Conversion India Pvt. both procedural and substantive law. Indian parties
Ltd., 2021 can designate a foreign seat of arbitration, as party
autonomy is not restricted. Awards made under a
foreign seat are enforceable under Part II of the
Arbitration Act, not Part I.

Sanshin Chemical The court ruled that if parties do not agree on the
Industry v. Oriental place of arbitration, they can authorize a person or
Carbons and institution to decide the venue of arbitration.
Chemicals Ltd., 2001 Section 2(6) and Section 20 allow for such
SC delegation.

Enercon India Ltd. & The court distinguished between the seat of
Ors. v. Enercon arbitration and the venue. London, in this case, was
GMBH & Ors., 2014 the venue, not the seat. Indian law governed the
SC substantive contract, arbitration agreement, and
conduct of arbitration. The designation of London
as a venue did not confer jurisdiction on English
courts, preventing the respondent from seeking
interim relief there.

Union of India v. The court clarified the distinction between "seat"

Hardy Exploration and "place." When only the term "place" is
and Production India mentioned without any attached conditions, it is
Inc., 2018 treated as the juridical seat. If a condition
precedent is attached, the "place" does not
automatically become the seat until the condition is
fulfilled.

BGS SGS Soma JV v. The court held that the designation of a seat
NHPC Ltd., 2019 SC confers exclusive jurisdiction on the courts at that
seat to oversee the arbitration.

MS Inox Renewable The Supreme Court held that if the seat of

Ltd. v. Jayesh arbitration is changed by mutual agreement
Electrical Ltd., 2021 between the parties, the court at the new seat will
SC have exclusive jurisdiction.
Section 28 / Rules Applicable to Substance of Dispute
Sec. 28
Raghubir Singh v. The court held that an arbitrator cannot decide
DMRC, 2007 Raj based on what they think is just and right unless
expressly authorized by the parties under Section
28(2). The arbitral tribunal must consider the terms
of the contract and trade usages applicable to the
transaction. Section 28(3) mandates that the
arbitral tribunal must decide the matter strictly in
accordance with the terms of the contract.

Associated The Supreme Court ruled that an arbitrator must

Engineering Co. v. act within the confines of the contract and cannot
Govt. of Andhra act arbitrarily, irrationally, or independently of it.
Pradesh, 1992 SC The arbitrator’s authority is limited to what the
parties have granted under the contract. Any action
outside the bounds of the contract is beyond
jurisdiction, and a deliberate disregard for the law
or contract provisions renders the award invalid.
Section 29 / Decision Making
Sec. 29
Abu Hamid v. Golam The court emphasized the principle of majority and
Sarvar, 1918 Cal joint deliberation among arbitrators. It held that
arbitrators must act collectively, with each present
at every meeting. Witnesses and parties must be
examined in the presence of all arbitrators, as
parties are entitled to the combined argument,
experience, and judgment of all arbitrators at every
stage of the proceedings. The mutual assistance of
arbitrators through conference is essential to
arriving at a just decision.

Rudra Muni Debaru v. In this case, a tribunal of five members passed an

Shrimat Maharaj award after two arbitrators resigned, and the
Niranjan Jagatguru, vacancies were not filled. The court set aside the
2009 Kar award, ruling that the absence of joint deliberation
among all members of the tribunal violated the
essence of collective arbitration. The argument that
the resigning arbitrators had already provided their
opinions was deemed untenable, as the tribunal's
integrity requires full participation of all its
members throughout the proceedings.
Section 31 / Form & Contents of Award
Sec. 31
JayPrakash Associates The Supreme Court held that if the general
Limited v. Tehri Hydro conditions of the contract between the parties
Development explicitly impose a complete bar on awarding
Corporation India pendente lite interest, the arbitral tribunal lacks
Limited, 2019 SC jurisdiction to pass such an award.

Union of India v. M/s The court ruled that if a contract expressly

Ambica Construction, prohibits the award of pendente lite interest, the
2016 SC arbitrator cannot grant it. However, the prohibition
against awarding interest on delayed payments
cannot be automatically interpreted as an express
bar to awarding pendente lite interest by the
arbitral tribunal. The distinction must be carefully
examined in each case.
Section 34 / Setting Aside
Sec. 34
PPI Ltd. v. UOI, 2001 The court upheld the constitutionality of not
Del allowing appeals on merits in arbitration. It noted
that arbitration agreements bind parties to the
arbitrator's decision. Allowing merit-based reviews
would undermine the arbitration process.

Superintending The court recognized the right to file an application

Engineer (Highway under Section 34 as a statutory right. This right is
and Rural Works), unconditional and cannot be curtailed, ensuring
Chennai v. DGI access to judicial review for setting aside awards.
Deivasigamani, 2005
Mad
PR Shah, Share and The court emphasized that challenges to arbitral
Stock Broker Pvt. Ltd. awards are limited to the grounds under Section
v. M/s BHH Securities 34. Courts do not act as appellate forums for
Pvt. Ltd. arbitration and cannot review awards on merits.

Renu Sagar Power Co. The Supreme Court held that an arbitral award
Ltd. v. General violating the Foreign Exchange Regulation Act
Electric Co., 1994 SC (FERA) contravenes public policy, as FERA
safeguards national economic interests. Public
policy was construed narrowly to include three
elements: (1) Fundamental policy of Indian law, (2)
The interest of India, and (3) Justice or morality.

ONGC Ltd. v. Saw The court expanded the definition of public policy
Pipes Ltd., 2003 SC to include patent illegality and introduced
additional grounds for setting aside awards: (1)
Fundamental policy of Indian law, (2) The interest
of India, (3) Justice or morality, and (4) Awards with
errors of law or those that shock judicial
conscience. This widened the scope of intervention,
later critiqued for undermining arbitration.

McDermott The court stated it was bound by Saw Pipes until

International Inc. v. reviewed by a larger bench. The Law Commission’s
Burn Standards Co. 246th Report in 2014 recommended narrowing
Ltd., 2006 SC public policy and patent illegality to preserve
arbitration’s purpose.

ONGC v. Western The Supreme Court interpreted "fundamental

Geco, 2014 SC policy of Indian law" to include perversity and
irrationality. Awards could be set aside if they failed
the Wednesbury Principle of Reasonableness, which
permits judicial review of unreasonable decisions.

Associate Builder v. The court held that the merits of an arbitral award
DDA, 2015 SC could only be reviewed under the broad framework
of public policy, as outlined in earlier cases.

Ssangyong Following the 2015 amendment, the court clarified

Engineering and patent illegality as a ground for challenge under
Construction Co. Ltd. Section 34(2A). Awards could be challenged if
v. NHAI, 2019 SC arbitrators exceeded their jurisdiction or dealt with
matters outside the contract.

Recent Cases
Punjab State Supply
Ltd v. Sunman Rice
Mills, 2024
DMRC v. Delhi Airport
Metro Express Pvt.
Ltd., 2024 SC
Modification
NHAI v. M Hakim, The court ruled that Section 34 does not grant
2021 SC courts the power to modify arbitral awards.
Modifying awards would exceed judicial authority
under the guise of statutory interpretation.

NHAI v. P Chelavaiah, While reiterating that courts cannot modify awards

2022 SC under Section 34, the Supreme Court exercised its
extraordinary powers under Article 142 of the
Constitution to modify the award, ensuring fairness
and justice in the specific case.

Timeline
MS Simplex The court stressed strict adherence to the statutory
Infrastructure Ltd. v. time limit for challenging awards. Section 5 of the
UOI, 2019 SC Limitation Act, which allows condonation of delay,
does not apply to proceedings under Section 34(3).

UOI v. Popular The court held that Section 34(3) provides an

Constructions Co., exhaustive time limit for setting aside arbitral
2001 awards, and no extension beyond this limit is
permissible.
Section 36 / Finality of Award
Sec. 36
Leela Hotel Limited v. The Supreme Court observed that under Section 36
Housing Urban of the Arbitration Act, an arbitral award is treated
Corporation as equivalent to a court decree for enforcement
purposes. The award must be enforced in the same
manner as a decree under the CPC, specifically
following the procedures outlined in Order 22 of
the CPC. The language of Section 36 leaves no
doubt regarding the enforcement of an arbitral
award.

Lakham Raja Sujata The court clarified that while an arbitral award is
Case not a decree within the meaning of Section 2(2) of
the CPC, it is deemed a decree for enforcement
purposes. Arbitral awards are given by private,
semi-judicial tribunals established by mutual
agreement, ensuring minimal court interference.
This legal fiction aims to save time, costs, and
procedural formalities, providing a streamlined
mechanism for resolving disputes.

Damodar Valley [●]

Corporation
Sundaram Finance The court held that the execution of an arbitral
Ltd. v. Abdul and Ors., award can be initiated anywhere in the country
2018 where the decree is executable. There is no
requirement to obtain a transfer of the decree from
the court that had jurisdiction over the arbitral
proceedings, thereby simplifying the process of
award enforcement.
Section 37 / Appeals
Sec. 37
Sec. 116 CPC
MMTC v. MS Vedanta The Supreme Court held that interference under
Ltd., 2019 Section 37 is limited to the restrictions under
Section 34, and courts cannot conduct an
independent assessment of the arbitral award.
Additionally, a challenge to an award must adhere
to the stipulated timeline of 30 days under Section
34, failure of which can lead to dismissal. Such
orders are appealable under Section 37(1)(c).

Bhayana Limited, The Supreme Court ruled that an order refusing to

2021 condone a delay in filing an appeal under Section
34 is appealable under Section 37.

UOI v. Reliance The court held that an order directing disclosure or

discovery of documents is not appealable under
Section 37(2)(b). Procedural orders regarding
discovery or disclosure issued by an arbitral
tribunal do not qualify for appeal under this
provision.

M/s NV International The Supreme Court strictly held that a delay of

v. State of Assam, more than 120 days (90 days plus 30 days'
2019 extension) in filing an appeal under Section 37
cannot be condoned.

Govt. of Maharashtra Overruling M/s NV International v. State of Assam,

(Water Resources the court held that a delay in filing an appeal under
Dept.) v. M/s Borse Section 37 can be condoned only in exceptional
Brothers Engineers cases where the party has acted bona fide and not
and Contractors Pvt. negligently. This is the current legal position.
Ltd., 2021
Shyam Sundar The Supreme Court ruled that the revisional
Agarwal & Co. v. UOI, jurisdiction of the High Court is not barred under
1996 the Arbitration Act if a civil court passes a final
order. The Act does not expressly prohibit
revisional powers, provided the exercise of such
powers does not undermine the provisions of the
Act.
Section 44
Sec. 44
PASL Wind Solutions The Supreme Court outlined four key ingredients
Pvt. Ltd. v. GE Power necessary for an arbitral award to be considered a
Conversion India Pvt. foreign award under Section 44: (1) The dispute
Ltd., 2021 SC must be a commercial dispute under Indian law; (2)
It must arise pursuant to a written arbitration
agreement; (3) The dispute must be between
persons regardless of nationality, residence, or
domicile; and (4) Arbitration must be conducted in
a country that is a signatory to the New York
Convention and has been recognized (reciprocity)
by the Central Government.
Section 45
Sec. 45
Cox and Kings Case The court examined the admission of non-signatory
parties under arbitration. Under Section 8, only
actual parties to the arbitration agreement are
typically considered, and non-signatories, including
assignees, must represent the signatory party.
Section 45, however, expands this scope, allowing
non-signatories, such as associate companies with
direct interests, to be parties to arbitration. The
Group of Companies Doctrine may apply in
domestic arbitration only in exceptional cases,
binding non-signatory companies based on common
intent, composite transactions, and close
involvement in the contractual arrangement.
Courts must avoid delving into the merits of the
case and cannot refuse to refer matters to
arbitration, as Section 8 and Section 45 are
peremptory.

Chloro Controls India The Supreme Court interpreted Section 45 to

Pvt. Ltd. v. Severn include non-signatories in arbitration under specific
Trent Water circumstances. The phrase "any person"
Purification demonstrates legislative intent to expand the scope
beyond signatories. A non-signatory party can be
bound if: (1) there is commonality of intent implied
by conduct or role in the contractual arrangement;
(2) multiple contracts form a single overarching
transaction involving non-signatories; or (3) the
non-signatory played a significant role in
negotiating, performing, or terminating the
contract. The doctrine applies to a tightly
structured group of companies.

State of Orissa v. The court held that under Section 45, judicial
Klockner & Co., 1996 authorities have no discretion to refuse referring
SC parties to arbitration if the specified conditions are
met. The mandatory language ("shall") in Section
45 obliges the court to refer disputes to arbitration.

Shakti Bhog Foods The court ruled that under Section 45, at the
Ltd. v. Kola Shipping request of a party or a person claiming through or
Ltd., 2008 under them, courts must refer the matter to
arbitration unless the agreement is found to be
null, void, inoperative, or incapable of being
performed. The provision ensures that valid
arbitration agreements are respected and enforced.
Section 47
Sec. 47
PEC Ltd. v. Austbulk The Supreme Court held that while adjudicating an
Shipping SDN BHD, application under Section 47 for enforcement of a
2018 SC foreign award, the absence of the arbitration
agreement at the time of filing the application does
not automatically warrant dismissal. The
arbitration agreement need not be filed
simultaneously with the application, and its
absence is not an outright ground for rejecting the
enforcement application.

Renu Sagar Power Co. The court ruled that an application for enforcement
v. General Electric of an award, accompanied by a certified xerox copy
Co., 1985 SC of the award as true by the ICC, was valid. The
xerox copy was later duly authenticated before the
judgment was delivered. It was held that such a
filing could not be considered invalid due to the
absence of the original award or a duly
authenticated copy at the time of submission.
Miscellaneous
Sec. 14
Sec. 15
Sec. 18
Sec. 19
Sec. 21
Sec. 22
Sec. 23
Sec. 24
Sec. 25
Sec. 26
Sec. 27
Sec. 29A
Sec. 29B
Sec. 30
Sec. 43
Sec. 40
Sec. 41
Sec. 45
Sec. 48