By Mr. Ajar Rab, Partner at Rab & Rab Associates LLP and Ms. Kirpen Dhaliwal, LL.M Candidate at NALSAR Hyderabad and research assistant to Mr. Ajar Rab
The recent judgment of a three-judge bench of the Supreme Court in PASL Wind Solutions Private Ltd.. v. GE Power Conversion India Private Ltd. (“PASL”) is a monumental victory for party autonomy in Indian arbitration. The Supreme Court has upheld the freedom of Indian parties to elect a seat of arbitration outside India, settling the much-debated law on this issue. Permitting two Indian parties to choose a foreign seat is a positive development as it effectively brings the Indian Arbitration and Conciliation Act, 1996 (“Arbitration Act”) in conformity with Article 1(3)(b) of the UNCITRAL Model Law, 1985 (“Model Law”). Article 1(3)(b) of the Model Law adopts a place-centric approach to define ‘international arbitration’. It recognizes the freedom of the parties to determine a place of arbitration outside of the State in which their place of business is situated.
Continue reading “Two Indian Parties Can Pick A Foreign Seat: But What About Substantive Law?”
By Khyati Tuli and Daksh Mehta, Students at Amity Law School, Delhi
Insolvency and International Commercial Arbitration (“ICA”) are two parallel regimes which tend to converge at various instances. The tribunals, across the world have taken different approaches in relation to continuance of ICA when a parallel insolvency proceeding has commenced in the native state of the entity.
Continue reading “Insolvency and International Commercial Arbitration: Two Distinct Approaches”
By Ashish Kumar and Trishit Kumar Satpati, Students at NMIMS School of Law, Bangalore
The apex court in the case of Government of India vs M/s Borse Brothers Engineers & Contractors Pvt Ltd (“Borse”) held that the delay in the filing of an appeal under section 37 of the Arbitration and Conciliation Act,1996 (“Act”) can be condoned if a sufficient cause is being provided. The earlier limitation of 120 days for filing an appeal was overruled but if a party exceeds the 90 days, then it must give sufficient reasons for such delay in accordance with section 5 of the Limitation Act(“LA”).
Continue reading “Condonation of Delay under Arbitration and Conciliation Act and Commercial Courts Act”
By Anushka Rungta, Student at Maharashtra National Law University Mumbai, and Pratik Irpatgire, Alumnus of Maharashtra National Law University Mumbai and Advocate
Powers of NCLT to refer the dispute to Arbitration
The Indian legal position with respect to adjudication of Insolvency by arbitration tribunal has always been under paradox due to availability of alternative remedies as prescribed under IBC Laws. §8 and 45 of the Arbitration Act endows the judicial authority to refer the dispute to the arbitration tribunal as prescribed by the arbitration clause. However, the Supreme Court in its several earlier attempts has particularly ruled out the powers of the NCLT or Company Law Board with respect to the adjudication of application under Insolvency or Winding up of the company.
Continue reading “The Conundrum of Arbitrability of Insolvency Disputes: Need for a legal framework and proactive role of appropriate forum [Part II]”
By Poojal Agarwal and Prateek Khandelwal, Students at Chanakya National Law University, Patna
The conundrum on the limitation period of filing an appeal under Section 37 of the Arbitration and Conciliation Act, 1996 (“Arbitration Act”) seems to be demystified with the Hon’ble Supreme Court of India verdict (“Supreme Court”) in the matter of Government of Maharashtra v. M/s Borse Brothers Engineers & Contractors Pvt. Ltd. (“Borse Brothers”). The Supreme Court with Borse Brothers has overruled its earlier judgement in the case of Union of India v. Varindera Constructions Ltd., (“Varindera Constructions”) and N.V. International v. State of Assam, (“N.V.International”) wherein it was held that limitation period for filing a petition to challenge an award under Section 34(3) of the Arbitration Act could be construed to be the limitation period for filing an appeal against the order, under Section 37 of the Arbitration Act. Moreover, it was also held that delay in filing such appeal could not be condoned as it will defeat the object of speedy resolution of all arbitral disputes.
Continue reading “Demystifying the Rule of Limitation Period Under Section 37 Appeals”
By Chandresh Bhawani, Student at Hidayatullah National Law University
The Supreme Court delivered its verdict in Bhavan Construction vs Executive Engineer Sardar Sarovar Narmada Nigam Ltd., Herein the issue before the Hon’ble court was whether the High Courts have the power to interfere with Arbitral Process by the virtue of Article 226 and 227 of the Constitution of India and in what circumstances such intervention would be allowed. Article 226 vests the High Courts with the power to issue directions, orders, and writs against any person or authority. Article 227 establishes the supremacy of the High Courts in their respective jurisdictions over other courts and tribunals. By the virtue of these articles, High Courts have the power to intervene in arbitration proceedings, but when the Arbitration and Conciliation Act (Act) provides for a mechanism of judicial intervention, there is a need to determine under what circumstances can such judicial intervention be permitted beyond the procedure established under the Act.
Continue reading “Delineating the Scope of Judicial Intervention in Arbitral Process”
By Mili Budhiraja, student at the Faculty of Law, University of Delhi
Under the Indian Partnership Act (“Act”), 1932, registration of partnership is not mandatory. But there are important repercussions of the non-registration of firms, as prescribed in Section 69 of the Act, which practically necessitates the registration at one time or the other. Section 69(3) of the Act has attracted much discourse because of the ambiguity in relation to the interpretation of the phrase “other proceedings”. The Supreme Court in the case of Umesh Goel v. Himachal Pradesh Cooperative Housing Society Ltd., held that the arbitration proceedings do not fall within the ambit of “other proceedings” and therefore, arbitration proceedings are not hit by the bar of Section 69. Through this piece, the application of the ingredients of the section will be analysed in the light of the decision of the Supreme Court in the case of Umesh Goel.
Continue reading “A Critique of the Umesh Goel v. Himachal Pradesh Cooperative Housing Society Case”
By Khushi Mishra and Rajeev Dadhich, Students at Institute of Law, Nirma University
Since the enactment of the Micro, Small and Medium Enterprise Development Act, 2006 (The “MSME Act”) a major dispute is between the institutional arbitration under Section 18 of the MSME Act and a sole arbitration as per Arbitration agreement (“AA”) constituted between the parties. As per Section 18 of the MSME Act which is the non- obstante clause, the Micro, Small and Medium Enterprises Facilitation Council shall either itself take up the dispute for arbitration or refer it to any institution to conduct arbitration. However, in the event of AA constituted between the parties, the parties are at the liberty to appoint a sole arbitrator to adjudicate their disputes. Therefore, the debated dispute ongoing is that what will prevail between institutional arbitration under section 18 and sole arbitration as per AA.
Continue reading “Jurisdiction Tussle between MSME Act and Arbitration Agreement: Opportunity Lies With the Supreme Court to Clear the Mist”
By Alay Ninad Raje and Jaysinh Kela, Students at Institute of Law, Nirma University
From time to time, the issue of arbitrability of fraud arises in order to ascertain whether the disputes involving allegations of fraud are capable of being resolved through arbitration instead of courts. The Supreme Court of India (SC) recently through the judgment of Vidya Drolia & Ors. v. Durga Trading Corp., (“Vidya Drolia”) explicitly overruled N. Radhakrishnan v. Maestro Engineers (“Radhakrishnan”) judgment, and providing a pro-arbitration approach towards arbitrability of fraud, thereby bringing clarity on the subject matter.
Continue reading “Explicating Arbitrability of Fraud in India”