07 (1)

Whether part of arbitration clause containing the word “may” can be construed to be an arbitration agreement as contemplated under Section 7 of Arbitration and Conciliation Act, 1996 – BGM and M-RPL-JMCT (JV) Vs. Eastern Coalfields Ltd. – Calcutta High Court

In this important judgment, Hon’ble Calcutta High Court holds that:
(i) The will to arbitrate must clearly be articulated in the arbitration clause. There is no room for any doubt or second-guessing. Parties must be clear in their minds that they wish to subject themselves to arbitration as the chosen mechanism of dispute resolution and ensure that the intention is expressed in writing in the form of the arbitration agreement.
(ii) An arbitration agreement also does not sit comfortably with conditions attached for the parties to go to arbitration. The clause should not be subject to or conditional upon further or future events which may or may not occur.
(iii) In essence, there cannot be any ‘ifs’ and ‘buts’ or an undecided mumble; the parties must give a resounding “Yes” to arbitration.
(iv) For a movement analogy; the arbitration agreement is not about a hesitant 1 step ahead-2 steps backward / back-tracking but a confident 1–way stride forward to arbitration.
(v) The word “may” in the relevant part of the clause gives an option to the parties to either refer the dispute to arbitration or hold back on the arbitration. The word “may” makes the clause conditional on a future event/s or to the other parts of the clause and gives the parties the option to resile from the clause.

Whether part of arbitration clause containing the word “may” can be construed to be an arbitration agreement as contemplated under Section 7 of Arbitration and Conciliation Act, 1996 – BGM and M-RPL-JMCT (JV) Vs. Eastern Coalfields Ltd. – Calcutta High Court Read Post »

Landmark judgment of Seven-Judge Bench of Supreme Court on Unstamped or inadequately Stamped Agreements including the law on the arbitration agreement and Separability of the arbitration agreement, the doctrine of competence-competence and Judicial interference under the Arbitration Act – In Re: Interplay Between Arbitration Agreements under the Arbitration and Conciliation Act 1996 and the Indian Stamp Act 1899 – Supreme Court

Read here summary of landmark judgment of Seven-Judge Bench of Supreme Court on Unstamped or inadequately Stamped Agreements including the law on the arbitration agreement and Separability of the arbitration agreement, the doctrine of competence-competence, Judicial interference under the Arbitration Act and other issues.

Landmark judgment of Seven-Judge Bench of Supreme Court on Unstamped or inadequately Stamped Agreements including the law on the arbitration agreement and Separability of the arbitration agreement, the doctrine of competence-competence and Judicial interference under the Arbitration Act – In Re: Interplay Between Arbitration Agreements under the Arbitration and Conciliation Act 1996 and the Indian Stamp Act 1899 – Supreme Court Read Post »

The validity of the ‘Group of Companies’ doctrine in the jurisprudence of Indian Arbitration – Landmark Judgment of Five-Judge Bench of Supreme Court – Cox and Kings Ltd. v. SAP India Pvt. Ltd. & Anr. – Supreme Court

Summary of the landmark judgment of a Bench of five judges is available here.

The validity of the ‘Group of Companies’ doctrine in the jurisprudence of Indian Arbitration – Landmark Judgment of Five-Judge Bench of Supreme Court – Cox and Kings Ltd. v. SAP India Pvt. Ltd. & Anr. – Supreme Court Read Post »

Section 7(5) of the Arbitration and Conciliation Act, 1996 looks to a seamless transition where the later contract becomes the arbitration agreement with a merging of the intention to arbitrate – Power Mech Projects Ltd. Vs. Bharat Heavy Electricals Ltd. – Calcutta High Court

Hon’ble High Court of Calcutta held that Section 7(5) embodies the law with regard to reference by incorporation. Section 7(5) requires that the later contract must refer to the document containing an arbitration clause constituting an arbitration agreement if the later contract is in writing and the reference encompasses the arbitration clause as part of the contract.

Further, whether an agreement is a standard form agreement or not would entirely depend on the agreement itself and no standardised formula can be applied to determine the same. It is not possible for a referral Court to test the form or nature of the agreement and come to a finding whether the agreement is unique to the parties or contains standard terms and conditions; it is also beyond the jurisdiction of the referral Court to get into this exercise.

Section 7(5) of the Arbitration and Conciliation Act, 1996 looks to a seamless transition where the later contract becomes the arbitration agreement with a merging of the intention to arbitrate – Power Mech Projects Ltd. Vs. Bharat Heavy Electricals Ltd. – Calcutta High Court Read Post »

Only a party to the arbitration agreement, which clause was originally contained in the arbitration agreement or incorporated into a second document, can exercise the right to interim measures – Kobelco Construction Equipment India Pvt. Ltd. Vs. Lara Mining & Anr. – Calcutta High Court

Hon’ble High Court held that it is also relevant that an application under section 9 which involves a party to an arbitration agreement is different from an application under section 11 of the 1996 Act. Section 11, particularly sub-sections (5) and (6) thereunder also envisages a party giving the right to the Supreme Court or High Court to appoint an Arbitrator/s on its behalf. However, the dispute as to which arbitration agreement would form the subject matter of the claim / counter-claim in the arbitration can also be adjudicated by the arbitral tribunal in that case. A section 9 Court, on the other hand, presumes that there is an underlying arbitration agreement between the party who approaches the Court for interim relief and the party against whom the interim relief is sought. Unlike a Court in a section 11 application, it would rarely be a business of a section 9 Court to go about ascertaining which arbitration agreement will have precedence over the other for the Court to grant interim measures of protection.

Only a party to the arbitration agreement, which clause was originally contained in the arbitration agreement or incorporated into a second document, can exercise the right to interim measures – Kobelco Construction Equipment India Pvt. Ltd. Vs. Lara Mining & Anr. – Calcutta High Court Read Post »

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