by Vasanth Rajasekaran* and Harshvardhan Korada**
“The Court failed to appreciate as to how the position, where not only does the respondent had the power to unilaterally appoint two out of the three arbitrators and compelled the petitioner to choose one of the panels of five arbitrators can be said to meet the test of ‘counter balancing’.”
Calcutta High Court held Arbitrator’s refusal to decide question of interest under the MSMED Act constitutes a “decision” and therefore, can be challenged under Section 34 of the Arbitration and Conciliation Act, 1996.
Arbitrator is a Judge chosen by the parties and his decision is final as long as it is founded in fairness and justice and an award cannot be passed on the ipse dixit of the arbitrator.
“As per Clause 31.16 of Letter of Intent between parties, place of arbitration was Faridabad (Haryana), which will be chosen as the seat, since seat has not been separately named and there are no other contrary indicia to show that place of arbitration is not intended to be seat of arbitration.”
Madras High Court said that if the Arbitrators are not paid their fees / costs on account of the moratorium order, the object of arbitration will get defeated, as competent Arbitrators will hesitate to become Arbitrators in a dispute involving Companies facing financial crisis.
The MSMED Act, 2006 is a beneficial legislation for Micro, Small and Medium Enterprises and ought to be construed in a manner that is beneficial to such enterprises.
“In certain situations, it may be expedient to leave it to the arbitrator to determine the issue as to whether stamping is insufficient, and if so, the arbitrator will take recourse to Section 33 of the Stamp Act, 1889.”
The ineligibility of an Arbitrator goes to the root of his jurisdiction and the Arbitral Award cannot be considered as valid.
Without questioning the validity and legality of the arbitration clause, the Calcutta High Court appointed an Arbitrator to decide the issues raised by both the parties.
Supreme Court said that whether any particular facts constitute a cause of action has to be determined with reference to the facts of each case and with reference to the substance, rather than the form of the action. If an infringement of a right happens at a particular time, the whole cause of action will be said to have arisen then and there.
“…being a special statute the MSMED Act will have an overriding effect vis-à-vis the Arbitration and Conciliation Act, 1996.”
On 31-3-2023, the India International Arbitration Centre (‘Centre’) notified the India International Arbitration Centre (Criteria for Admission to the panel of arbitrators)
The impugned arbitral award was passed without considering the clauses of the Concessionaire Agreement while adjudicating on the rate of interest to be granted, thus, suffers from infirmity and patent illegality.
Calcutta High Court held that all the unilateral appointment of arbitrators is not invalid unless the arbitrator’s relationship falls within the Seventh Schedule to the Arbitration and Conciliation Act, 1996.
The Delhi High Court held that even if the Contract clearly stated that before resorting to arbitration, the parties agreed to explore Conciliation by the Committee, the same cannot be held to be mandatory in nature. Further, the Court held that in case of urgency, arbitral proceedings can be initiated even when conciliation proceedings were pending.
Where there exists any iota of inconsistency between two provisions of a same instrument, the former clause shall prevail over the latter one
The Delhi High Court dismissed an application filed for “recall of earlier order” under Section 151 of CrPC and held that the settled things could not be permitted to be unsettled at the behest of a person who had not been careful enough with regard to his rights and claims.
The Delhi High Court ruled that the moratorium granted by the NCLAT, staying the institution of suits and proceedings against the Corporate Debtor, after the resolution process was initiated against it under Sections 241 and 242 of the Companies Act, 2013, was akin to an order of moratorium passed under Section 14 of the Insolvency and Bankruptcy Code, 2016.