Bombay High Court: While deciding an issue whether the Court should constitute an Arbitral Tribunal for disputes arising from a Sale and Purchase Contract dated 24-6-2024, or whether all disputes arising from multiple inter-connected agreements between the parties should be referred together, a Single-Judge Bench of Sandeep V. Marne, J., held that, since both parties consented to a common reference, a three-member Arbitral Tribunal would be constituted to decide disputes arising not only from the 24-6-2024 contract but from all the inter-connected agreements listed by the respondent which were not part of the Section 11 petition.
In the instant matter, an application was filed under Section 11 of the Arbitration and Conciliation Act, 1996 (‘A&C Act’) for the constitution of an Arbitral Tribunal in terms of an arbitration clause contained in the Sale and Purchase Contract dated 24-6-2024. The clause provided a dispute settlement mechanism with the seat of arbitration at Mumbai and disputes to be settled by three arbitrators, one appointed by each side and the third mutually appointed by the first two.
While the applicant sought constitution of the Tribunal based on the Sale and Purchase Contract dated 24-6-2024, the respondent contended that there were numerous other agreements executed between the parties which had also given rise to disputes and differences. It was submitted that a selective reference limited to the Sale and Purchase Contract should not be permitted. The respondent requested a common reference to the Arbitral Tribunal for resolution of disputes and differences arising out of all such agreements and contracts. The applicant agreed to the suggestion and already nominated its Arbitrator in an invocation notice dated 5-10-2025, and the respondent, on instructions, nominated its Arbitrator in Court.
The Court noted that the parties had consented for the common reference and therfore, directed for the constitution of an Arbitral Tribunal comprising three members for adjudication of disputes and differences arising out of the Sale and Purchase Contract dated 24-6-2024 as well as the other agreements. The Court ordered that the nominee arbitrators must proceed to appoint the Presiding Arbitrator in an expeditious manner. The Court observed that the fees of the Arbitrators shall be as prescribed under the Bombay High Court (Fee Payable to Arbitrators) Rules, 2018, and that arbitral costs and fees shall be borne equally by both sides, and would be subject to the final award that may be passed by the Tribunal.
[Essar Power Gujarat Ltd. v. Narayan Resources (P) Ltd., Commercial Arbitration Application (L) No.39178 of 2025, decided on 20-1-2026]
Advocates who appeared in this case:
For the Applicant: Pranjit Bhattacharya with Avdhoot Prabhu, Advocates.
For the Respondent: Aditya Pimple with Umang Mehta i/b M/s. Avyaan Legal.
Buy Arbitration and Conciliation Act, 1996 HERE
