When Can High Court Invoke Article 227 Against Arbitral Tribunal?

The Recurring QuestionOne question has consistently tested the boundaries of judicial intervention in arbitration, namely, whether a party dissatisfied with an order of an Arbitral Tribunal, typically one rejecting a jurisdictional objection under Section 16 of the Arbitration and Conciliation Act, 1996 (herein after referred to as “the Act”), run to the High Court under Article 227 of the Constitution instead of waiting for the final award? The Supreme Court has answered this question...

Can Pre-Deposit Be Mandated To Invoke Arbitration? Supreme Court Refers To Larger Bench, Doubts 2009 Precedent

The Supreme Court on Monday (August 17) referred the question to a larger Bench as to whether pre-deposit conditions in arbitration clauses, requiring contractors to deposit a percentage of the claim amount before invoking arbitration, are valid. A bench of Justice Manoj Misra and Justice Manmohan expressed doubt about the binding nature of the three-judge Bench decision in S.K. Jain v....

Former SC Judge Moves Supreme Court Against Rajasthan HC Calling Tribunal Headed By Him 'Lethargic', Reducing Arbitral Fee

Former Supreme Court judge-Justice Deepak Verma has approached the Supreme Court against a Rajasthan High Court order which criticized a Arbitral Tribunal headed by him as "lethargic".For context, a Single Judge of the High Court passed an order on May 27 directing a 5% cut in the arbitral fees already paid, observing a lack of procedural discipline in the arbitration and defeat of...

Arbitration | Post-Award Section 9 Application By Unsuccessful Party Maintainable In Exceptional Cases : Supreme Court

The Supreme Court on Tuesday (August 11) held that to prevent an award holder's enrichment of a bank guarantee while an award was under challenge, an interim relief under Section 9 of the Arbitration & Conciliation Act, 1996 can be extended on an award debtor's application to preserve the efficacy of the challenge in Section 34. A bench of Justice KV Viswanathan and Justice Alok...

Arbitration | Involvement In Performance Of Underlying Contract A Factor To Decide If Non-Signatory Bound By Agreement : Supreme Court

The Supreme Court on Wednesday (August 5) held that the involvement of a non-signatory in the performance of the contract would be a factor to consider if they would be bound by the arbitration agreement.“…the participation of a non-signatory in the performance of the underlying contract is the most important factor to be considered as the conduct of the non-signatory parties is an...

Why Meaningful Costs Adjudication Is Essential For Promoting Arbitration In India

Indian courts continue to grapple with an enormous and ever-increasing docket of cases. India's economic aspirations and its ambition to remain one of the world's fastest-growing economies are inextricably linked to the existence of a robust, efficient and credible dispute resolution framework. Investors and entrepreneurs, whether domestic or foreign, seek assurance that commercial disputes, will be resolved fairly, expeditiously and at a reasonable cost. The only viable alternative forum which...

Not Every Procedural Irregularity Vitiates An Arbitral Award: Allahabad High Court

The Allahabad High Court at Lucknow has recently held that not every procedural irregularity would vitiate an arbitral award or justify interference under Sections 34 or 37 of the Arbitration and Conciliation Act, 1996. A Division Bench of Chief Justice Arun Bhansali and Justice Jaspreet Singh made the ruling in a dispute between the U.P. State Highways Authority and the...

Last In Line, First To Bleed: How Arbitration Fails Sub Contractors

Arbitration was marketed as faster, cheaper, more flexible than courts, and tailor‑made for commercial players. But, for sub‑contractors, the reality is brutally different. Escalating fees, narrow judicial review and structural barriers to even getting a fair hearing often turn arbitration into a high‑risk gamble rather than an effective remedy, leaving them in a worse position than if...

Supreme Court's 'Delhi Metro' Judgment Caused Extensive Damage To Arbitration In India: Justice Ujjal Bhuyan

The Supreme Court's 2024 Delhi Metro Rail Corporation Ltd. v. Delhi Airport Metro Express Pvt. Ltd. judgment has caused "the most extensive damage to arbitration in India" and undermined the country's efforts to emerge as a global arbitration hub, Supreme Court judge Justice Ujjal Bhuyan said on Saturday, expressing grave concern over increasing judicial interference in arbitral...

Supreme Court Rescues Arbitration Limitation Clock From Maintainability Trap

A Procedural Nightmare Finally Laid to RestAsk any arbitration practitioner who has managed a post-award correction under Section 33 of the Arbitration and Conciliation Act, 1996, and they will describe the same dilemma. A Section 33 application has been filed. The tribunal is considering it. Limitation under Section 34(3) is ticking. Does the party wait for the tribunal to dispose of the application, or does it simultaneously file a Section 34(1) petition in court, purely as a safeguard against...

Words Are Not Enough: Every Clause Containing 'Arbitration' Is Not An Arbitration Agreement

Commercial Contracts are the reflection of the trust parties place in a legal framework to protect their interests. When this trust of parties breaks down, among the many clauses of the commercial agreement ('agreement'), the dispute resolution clause occupies a position of singular importance. In recent times, Arbitration has emerged as one of the most preferred mechanisms owing to its flexibility, confidentiality, procedural efficiency, and party-driven nature. The result has been the...

Arbitration | Article 227 Can't Be Ordinarily Invoked To Challenge Rejection Of S.16 Application By Arbitral Tribunal : Supreme Court

The Supreme Court on Tuesday (July 14) held that it is impermissible for the High Court to ordinarily interfere with, while exercising its supervisory jurisdiction, the decision of an Arbitral Tribunal rejecting the application under Section 16 of the Arbitration and Conciliation Act, challenging the jurisdiction of the tribunal.“…we hold that the High Court was not justified in...