Welcome back to our updates from the world of arbitration!
The Singapore International Arbitration Centre has released its annual report for 2020. India-based parties top the list of users with more than half of the cases involving Indian parties.
The International Bar Association released a toolkit which aims to provide guidance to parties, counsel and arbitrators in situations where a party to arbitration proceedings is also subject to insolvency proceedings in one or more jurisdictions. The release of the toolkit is timely with India and many other jurisdictions slowly removing the pandemic breaks given to parties from insolvency and bankruptcy laws.
In a related development, which has been covered in greater detail by our IBC Brief, the SC in P. Mohanraj v. Shah Brothers Ispat, has held that PGCIL v. Jyoti Structures does not lay down the correct position of law. This would mean that a company would be able to seek adjournment of Section 34 proceedings initiated by it against another counter-party during the continuance of the CIRP moratorium.
From the Docket:
Is a delay beyond 30-days in filing an appeal under Section 37 of the Arbitration and Conciliation Act, 1996 (“Act”) condonable? Yes, ruled the SC in Government of Maharashtra v. Borse Brothers Engineers & Contractors. The Supreme Court held that delays beyond 90 days, 30 days or 60 days, can be condoned in appeals under Section 37 that are governed by Articles 116 and 117 of the Limitation Act or section 13(1A) of the Commercial Courts Act, respectively. The SC has overruled NV International v. State of Assam.
The Parliament needs to consider amendments to the Act to enable an appeal against orders under Section 11(6), the SC observed in Pravin Electricals v. Galaxy Infra and Engineering.
Are time-barred claims referable to arbitration? One had hoped that this controversy had been laid to rest, but recently in BSNL v. Nortel Networks India, the Supreme Court held that under section 11 of the Act, the Court can go into the question of limitation and refuse the referral to the arbitration if there is no iota of doubt that the claims are ex facie time barred. The Court however, cautioned that there is even the slightest doubt, the rule is to refer the disputes to arbitration, otherwise it would encroach the domain of the arbitral tribunal. The Court held that while exercising jurisdiction under section 11, the court may exercise the “prima facie” test to filter out the meritless, frivolous, and dishonest litigation.
In Dakshin Haryana Bijli Vitran Nigam v. Navigant Technologies, the Supreme Court held that the period of limitation for filing objections under Section 34 would have to be calculated from the date on which the signed copy of the award is made available to the parties. While reaching its conclusion, the court held that it is mandatory for each of the members of the tribunal to sign the award, to make it a valid award. Further, the Court also opined that a dissenting opinion must be delivered contemporaneously on the same date as the final award, and not on a subsequent date, as the tribunal becomes functus officio upon the passing of the final award.
In Amway India Enterprises v. Ravindranath Rao Sindhia, the Supreme Court held that notwithstanding the fact that an individual or body corporate, or government of a foreign country referred to in section 2(1)(f) of the Act carries on business in India through a business office in India, if such a person is involved in a dispute, the arbitration becomes an international commercial arbitration.
The Supreme Court in UNITECH Limited v. Telangana State Industrial Infrastructure Corporation, held that the presence of an arbitration clause within a contract between a state instrumentality and a private party will not act as an absolute bar to availing remedies under Article 226 of the Constitution of India. The apex Court further stated that if the state instrumentality violates its constitutional mandate under Article 14 of the Constitution and does not act fairly and reasonably, relief under the plenary powers of the Article 226 of the Constitution would lie.
A single judge of Delhi High Court in Amazon.com NV Investment Holdings LLC v. Future Coupons had held that an Emergency Arbitrator is an Arbitrator for all intents and purposes, as is clear from the conjoint reading of sections 2(1)(d), 2(6), 2(8), 19(2) of the Act and the Rules of SIAC which governed the arbitration agreement between the parties. The court further held that the section 2(1)(d) is wide enough to include an Emergency Arbitrator. However, a Division Bench of the Delhi High Court has stayed the operation of the judgement rendered by the single bench till next date of hearing i.e 30.04.2021.
In Laxmi Civil Engineering Services v. Gail, the Delhi High Court reiterated that non-signatories may also be construed as parties to an arbitration agreement in certain exceptional circumstances where it is found that the non-signatory is a part of a single economic entity. However, in this case, the court refused to refer the sub-contractors whose payments had been delayed by GAIL to arbitration as (a) the petitioner had a separate contract with the sub-contractors; (b) GAIL was not a party in any contract with the sub-contractors.
In Hero Electric Vehicles v. Lectro E-Mobility, the Delhi High Court held that trademark disputes between the parties were ex-facie arbitrable. The Court observed that the controversy in the present case did not relate to grant, or registration, of trademarks, but relates to the provisions of the Family Settlement Agreement which granted the usage of the trademark. The court upheld the section 8 application filed by the respondent and referred the matter to arbitration.
Thank you for reading! We will be back in your inbox next month with more updates.