ARBITRATION

HANDBOOK
October, 2023 | Vol. 1

AHMEDABAD | BENGALURU | NEW DELHI | KOLKATA | HYDERABAD | MUMBAI | PUNE | SURAT

 TABLE OF
CONTENTS
1. Yashang Navinbhai Patel v. Dilipbhai Prabhubhai Patel 01

2. Tomorrow Sales Agency (P) Ltd. v. SBS Holdings Inc 02

3. B.L. Kashyap and Sons Ltd v. MIST Avenue Pvt. Ltd. 03

4. Sunflag Iron & Co Ltd. v. J. Poonamchand & Sons 04

5. Chandan Chatterjee & Ors. v. Gita Sundararaman And Ors. 05

6. M.D. Creations & Others v. Ashok Kumar Gupta 06

7. M/s KK Ropeways Limited v. M/s Billion Smiles Hospitality 07

8. GLS Foils Products Pvt. Ltd v. FWS Turnit Logistic Park LLP 08

9. B.L. Kashyap and Sons Ltd v. Emaar India Ltd 09

10. M/s. National Aluminium Company Ltd., Bhubaneshwar 10

v. M/s. Orissa Coal Chem. Pvt. Ltd., Cuttack & Ors.
 TABLE OF
CONTENTS

11. National Highways Authority of India v. Trichy Thanjavur 11

Expressway Ltd.

12. Ministry of Youth Affairs & Sports v. Ernst and Young 12

13. Microvision Technologies Pvt Ltd v. Union Of India 13

14. Radha Bhattad v. Rashmi Cement Ltd. 14

15. India Oil Corporation Ltd. & Anr. v. The Commercial 15

Court & Anr.

16. Daljit Singh & Brothers Contractor v. Chief Engineer, 16

Punjab & Anr

17. Parekh Plastichem v. Simplex Infrastructure Ltd. 17

18. Rudra-XI Infrastructure Pvt. Ltd. v. Municipal Corporation 18

Shimla

19. Ircon International Limited v. Delhi Metro Rail Corporation 19

 ARBITRATION

Yashang Navinbhai Patel v. Dilipbhai Prabhubhai

Patel
R/PETN. UNDER ARBITRATION ACT NO. 116-117 of 2021 21.04.2023

Whether the Arbitration clause is maintainable when the

Partnership itself has been dissolved

The Hon’ble Gujarat High Court has held that once a Partnership
Deed is dissolved, its arbitration clause cannot be used to refer any
disagreement / disputes between the parties to arbitration.

While dismissing the petition under Section 11 of the Arbitration

and Conciliation Act 1996, the Court opined that since the
relationship between the partners was severed pursuant to
dissolution, it has led to extinguishment of the arbitration clause
itself.

The Court relied on it own decision in Mohanlal Sajandas vs

Hareshkumar Narandas & Ors., 2001 (3) GLH 532, wherein it was
held that if any disputes had arisen between the parties after the
Partnership was dissolved, the same cannot be said to be during the
course of the Partnership Deed.
01 | AMLEGALS
 ARBITRATION

Tomorrow Sales Agency (P) Ltd. v. SBS Holdings Inc.

2023 SCC OnLine Del 3191 29.05.2023

Arbitral Award cannot be enforced against Third Party

Fund providers

The Hon’ble Delhi High Court has held that no Arbitral Award can
be enforced against the Third Party Fund providers who are neither
a signatory to the Arbitration Agreement nor a party to the
Arbitration proceedings.

The Court remarked that third-party fund providers are an

important part of the justice system and in their absence, a lot of
parties may not be in a position to fight for their legitimate claim.

Therefore, it is important that they are not punished just because

the Claimant backed by them has not been able to prove its claim.
Such enforcement against third-party fund providers is neither
desirable nor permissible.

02 | AMLEGALS
 ARBITRATION

B.L. Kashyap and Sons Ltd v. MIST Avenue Pvt. Ltd.

2023 SCC OnLine Del 3518 02.06.2023

Arbitration Clause in a Contract will perish with the

Contract's Novation

The Hon'ble Delhi High Court has held that once a Contract is
novated, the Arbitration Clause in that contract perishes.

The Court held that it was beyond its limited jurisdiction under
Section 34 of the Arbitration & Conciliation Act, 1996 to interfere
with the Sole Arbitrator's finding that the MoU entered into
between the parties constituted a novation of the Contract.

The Court went on to hold that the findings of an arbitral tribunal

on contractual interpretation are to be respected unless the same
are irrational, perverse, or implausible.

03 | AMLEGALS
 ARBITRATION

Sunflag Iron & Co Ltd. v. J. Poonamchand & Sons

2023 SCC OnLine Bom 1214 05.06.2023

Mere filing of an Application under Section 7 of IBC 2016

does not bar an Application under Section 11 of the A&C
Act 1996 for the appointment of an Arbitrator

The Hon’ble Bombay High Court (Nagpur Bench) has held that
merely because a Section 7 Application has been filed under IBC
2016 against the party, it does not create any bar for filing of a
Section 11 Application for appointment of an Arbitrator.

The IBC does not put any embargo on the invocation of the arbitral
proceedings when there is an arbitration clause in the agreement.
IBC and the Arbitration and Conciliation Act are vividly distinct and
autonomous statutes, each serving a different purpose.

In the absence of any express bar in the IBC, the party has all the
rights to approach the Court for appointment of an Arbitrator.

04 | AMLEGALS
 ARBITRATION

Chandan Chatterjee & Ors. v. Gita Sundararaman

And Ors.
AP No. 186 of 2023 08.06.2023

Application under Section 11 of the Act should not be

rejected merely on technical grounds

The Hon’ble Calcutta High Court has held that an application made
under Section 11 of the Arbitration and Conciliation Act, 1996 for
appointment of an Arbitrator should not be rejected on technical or
procedural reasons.

The Court additionally noted that when the arbitration agreement is

admitted, the Court may forgo the obligation under the rules of
procedure to file the original arbitration agreement or a certified
copy thereof.

05 | AMLEGALS
 ARBITRATION

M.D. Creations & Others v. Ashok Kumar Gupta

C.O. 2545 of 2022 09.06.2023

Article 227 can only be invoked against an Order under

Section 16 under exceptional circumstances

The Hon’ble Calcutta High Court has held that against an order
passed under Section 16 of the Arbitration and Conciliation Act
1996 can only be challenged under Article 227 of the Constitution of
India under exceptional circumstances.

The Hon’ble Court reasoned that when an aggrieved party's claim

challenging the arbitrator's jurisdictional competency is rejected,
they must wait until the final award before submitting an
application to set aside the arbitral ruling under Section 34 of the
Act.

Since the aggrieved party is not without any legal recourse, the Court
rightly dismissed the revisional application under Article 227 of the
Constitution of India as there is nothing on record that expresses a
patent inherent lack of jurisdiction.
06 | AMLEGALS
 ARBITRATION

M/s KK Ropeways Limited v. M/s Billion Smiles

Hospitality
Comp. App (AT) (CH) (INS.) No. 246 / 2021 12.06.2023

Application under Section 9 of IBC, 2016 for

implementation of an Arbitral Award is not maintainable

The Hon’ble National Company Law Appellate Tribunal

("NCLAT"), Chennai Bench, has held that a petition filed under
Section 9 of IBC for implementation of an Arbitral Award is not
maintainable and not in tune with the objective of IBC.

The Tribunal pointed out that the Award came to be passed,

based on the Rental Dispute, and when the Appeal was filed by
the Respondent against the Award, the Operational Debt can be
considered to be under Dispute.

Keeping in mind the facts and circumstances of the case, in a

conspectus fashion, the NCLAT came to an inescapable,
inevitable and irresistible conclusion that the view arrived at by
the NCLT, Bengaluru was correct.

07 | AMLEGALS
 ARBITRATION

GLS Foils Products Pvt. Ltd v. FWS Turnit Logistic

Park LLP
ARB.A.(COMM.) 43 OF 2022 10.07.2023

Courts should not interfere with well-reasoned Interim

Awards under Section 37 of the Arbitration & Conciliation
Act, 1996.

The Hon’ble High Court of Delhi has reiterated that as long as the
Arbitral Tribunal has granted an interim relief to a party to protect
and preserve the subject matter of arbitration and it balances the
equities between the parties on consideration of prima facie case,
balance of convenience and irreparable damage, the Courts
should not interfere with such orders.

Section 37 is not strictly like an appeal process and should be

exercised cautiously. Interference would only be permissible
when the order is palpably arbitrary or unconscionable.

08 | AMLEGALS
 ARBITRATION

B.L. Kashyap and Sons Ltd v. Emaar India Ltd

EX.APPL.(OS) 740/2023 in OMP (ENF.) (COMM.) 103/2023;
EX.APPL.(OS) 741/2023 in OMP (ENF.) (COMM.) 104/2023
18.07.2023

Enforcement of an Arbitral Award cannot be stayed due to

liquidity crunch of the Award Debtor

The Hon'ble Delhi High Court has held that an Award Debtor’s
poor financial condition or liquidity crunch cannot be a sufficient
ground under Order XXI Rule 26(1) of the CPC for granting stay
on the enforcement of an Arbitral Award.

The Court concluded that a bank guarantee cannot be utilised by

the Award Holder to compensate its loss and that the alleged
liquidity crunch cannot be a sufficient cause under Order XXI
Rule 26(1) of CPC to grant stay.

Therefore, the request of Award Debtor to accept the bank

guarantee as security was not acceded to.

09 | AMLEGALS
 ARBITRATION

M/s. National Aluminium Company Ltd.,

Bhubaneshwar v. M/s. Orissa Coal Chem. Pvt. Ltd.,
Cuttack & Ors.
ARBA No. 8 and 13 of 2020 01.08.2023

If the MSMED Act has to be read with the A&C Act, the
MSEFC established under the MSMED Act must step into
the shoes of an Arbitrator

The Hon’ble Orissa High Court observed that the Facilitation

Council derives its powers from the Arbitration and Conciliation
Act, 1996. Moreover, the Act is entirely applicable to MSMED
Act.

Furthermore, the appeal against the award passed by the

Facilitation Council will lie under Section 34 and Section 37 of the
Act. Therefore, the scope of judicial intervention for the
proceedings under the MSMED Act is also limited.

Therefore, the Facilitation Council shall act as an Arbitrator while

dealing with disputes preferred under Section 18 of the MSMED
Act and shall follow the principles of natural justice while
rendering an Award. 10 | AMLEGALS
 ARBITRATION

National Highways Authority of India v. Trichy

Thanjavur Expressway Ltd.
M.P. (COMM) 95/2023 & O.M.P. (COMM) 106/2023 21.08.2023

Whether a part of an Arbitral Award can be set aside

while deciding an application under Section 34.

The Hon’ble Delhi High Court has held that if the parts of an
Arbitral Award can be construed separately and independently, the
Court is empowered to partly set aside the Award under Section 34
of the Arbitration and Conciliation Act 1996.

The Court asserted that it is the Doctrine of Severability under which

such parts can be set aside and this is different from modification /
alteration of an Award. Modification / alteration of an Award is not
allowed as has already been decided by the Hon’ble Apex Court.

The Court however, also reiterated that under the umbrella of

Section 34, a Court is not empowered to review the Arbitral
Tribunal’s findings and it should only keep its interference limited to
what is allowed within the contours of Section 34.

11 | AMLEGALS
 ARBITRATION

Ministry of Youth Affairs & Sports v. Ernst and

Young
O.M.P. (COMM) 377/2018 23.08.2023

Whether delivery of scanned copy of an Arbitral Award

via email can be considered valid service

The Hon’ble Delhi High Court has held that the delivery of a
scanned copy of an Arbitral Award by the Arbitral Tribunal by email
would constitute valid service of the award under Section 31(5) of
the Arbitration and Conciliation Act 1996.

The Court asserted that it is not important for an Arbitral Award to

be signed in ink and the period of limitation for challenging an
Arbitral Award under Section 34 of the Act would commence on the
date of the said email being sent by the Arbitral Tribunal.

The Court also observed that the fact that the Arbitral Award was
physically collected by the party at a later date is immaterial for the
issue of limitation.

12 | AMLEGALS
 ARBITRATION

Microvision Technologies Pvt Ltd v. Union Of India

REVIEW PETITION (L) NO.36475 OF 2022
IN
NOTICE OF MOTION NO.3 OF 2021
IN
COMM ARBITRATION PETITION (L) NO.855 OF 2018 24.08.2023

Whether a party can approach the High Court for

appointment of Arbitrator when reference to MSEFC
Council has already been made and is pending.

The Hon’ble Bombay High Court has held that when a reference has
already been made to the Micro & Small Enterprises Facilitation
Council (MSEFC) for appointment of an Arbitrator, during the
pendency of such a reference, a party cannot approach the High
Court for appointment of an Arbitrator unless the Application is
under Section 11(6) of the Arbitration & Conciliation Act, 1996
when the MSEFC fails to appoint an Arbitrator.

This stands true even when there is an independent arbitration

agreement between the parties.

Moreover, the Court went on to reiterate that as per Section 18(4) of

the MSMED Act, the jurisdiction to act as an Arbitrator or
Conciliator is determined according to where the supplier is located.

13 | AMLEGALS
 ARBITRATION

Radha Bhattad v. Rashmi Cement Ltd.

IA NO: GA 1 of 2023 In RVWO 34 of 2023 01.09.2023

Review of Appointment of Arbitrator permissible under

the Plenary Jurisdiction of High Courts

The Hon’ble Calcutta High Court observed that though Arbitration

and Conciliation Act 1996 is a complete Code in itself, and does not
provide any provision for review of petition under Section 11 of the
Act, a review cannot be restricted under the Act.

The High Court being a court of record, is empowered to rectify the

apparent error on record and hence, a review petition is maintainable
under Article 215 of the Constitution of India against an order passed
under Section 11 of the Act. Therefore, the review of an order under
Section 11 of Act is maintainable under the plenary jurisdiction of the
High Court.

It was also held that the compliance of Order XLVII Rule 1 of CPC is
based on merits, which would be considered at the time of hearing.
14 | AMLEGALS
 ARBITRATION

India Oil Corporation Ltd. & Anr. v. The Commercial

Court & Anr.
MATTERS UNDER ARTICLE 227 No. 7573 of 2022 06.09.2023

Arbitral Award cannot be considered a Decree as per

Section 2(2) of the Code of Civil Procedure, 1908

The Hon’ble Allahabad High Court held that an Arbitral Award is

not a decree and objections against it cannot be raised under Section
47 of the CPC. It observed that an Arbitral Award can be executed as
per Section 36 of the Arbitration and Conciliation Act along with the
provisions of the CPC.

The Court asserted that the Arbitral proceedings commenced under

the Old Arbitration Act can continue under the provisions of the Act,
if mutually agreed by the parties.

Further, since an Arbitral Award cannot be considered to be a

decree as under the provisions of CPC, therefore, cross-objections
cannot be raised during execution of an Arbitral Award. This has
upheld the objective of the A&C legislation, which is free from
complex procedure of CPC.
15 | AMLEGALS
 ARBITRATION

Daljit Singh & Brothers Contractor v. Chief Engineer,

Punjab & Anr

ARB-132-2019 (O&M) 11.09.2023

Whether mere issuance of notice for invocation of

Arbitration make the limitation period start afresh

The Hon'ble Punjab and Haryana High Court has held that
merely issuance of a notice for invoking arbitration in stale claims
would not make the limitation start afresh.

The Court observed that it is correct that the limitation for filing
an application under Section 11 of the Act would begin to run
from the date when there is failure to appoint Arbitrator

It went on to conclude that though, normally in case of a question

which is disputed which has some chequered or disputed facts,
this Court would leave it to the Arbitrator to decide on issue of
limitation but the instant case would fall in one of those rare and
exceptional cases justifying dismissal at the very outset.

16 | AMLEGALS
 ARBITRATION

Parekh Plastichem v. Simplex Infrastructure Ltd.

Arbitration Application No. 250 of 2021 14.09.2023

Arbitration Clause in a Purchase Order would supersede

the conflicting Clause in the Invoice

The Hon'ble Bombay High Court has held that the Arbitration
Clause in a Purchase Order would supersede a conflicting Clause
in the invoice as the Purchase Order contained the main
agreement between the parties with regards to the details of the
transaction which was not the case in the Invoice.

While deciding the Section 11 Application, the Court noted that

the invoices provided for the Courts of Bombay to have the
jurisdiction whereas the Purchase Order provided for Courts of
Kolkata to have the jurisdiction.

The Court observed that the Courts at Kolkata only had the
jurisdiction to entertain an Application for appointment of
arbitrator.
17 | AMLEGALS
 ARBITRATION

Rudra-XI Infrastructure Pvt. Ltd. v. Municipal

Corporation Shimla

OMP No. 739 of 2021 in Arb. Case No. 53 of 2018 18.09.2023

Whether a party needs to furnish a fresh Bank Guarantee

if the previous one expires during the period of interim
relief.

The Hon'ble High Court of Himachal Pradesh (at Shimla) has

held that a party would need to furnish a new Bank Guarantee if
an interim relief under Section 9 of the Arbitration and
Conciliation Act, 1996 has been passed restricting a party from
enforcement of the Bank Guarantee and the same has expired
during the interim period and the case was eventually dismissed
as withdrawn.

The Court observed that during the period of the restraint order,
the Bank guarantee expired and later on when the court order
was lifted due to the withdrawal of the primary petition, the
Petitioner found itself unable to enforce the Bank Guarantee,
which was enforceable on the date of the application and the
initial order passed by the Court. Therefore, the Respondent was
directed to furnish a fresh Bank Guarantee. 18 | AMLEGALS
 ARBITRATION

Ircon International Limited v. Delhi Metro Rail

Corporation
O.M.P. (COMM) 165/2023 09.10.2023

Can compensation be claimed when the Contractor has

not reserved its right to claim it?

The Hon'ble Delhi High Court, while deciding a Section 34

Application, has held that if the Contractor has not explicitly
reserved its right to claim compensation when it sought extension
of time due to non-availability of work site, it will not be entitled to
compensation for those extensions.

It must be noted here that the Contract did not provide any clause
for compensation.

The Court observed that though the Contractor sought 4

extensions, it reserved its right to claim compensation only in the
3rd letter. It held that the Tribunal was correct in deciding that the
Contractor had waived this right by not reserving it in the rest of
the letters and was rightly awarded compensation only for the 3rd
letter.
19 | AMLEGALS
 ABOUT US

MLEGALS is a multi-disciplinary
specialized law firm. OUR MOTTO
It is always been to be known as a
We believe that it is our duty to research driven law firm and that is
share knowledge on different kinds the reason we focus on keeping
of laws and legal issues with our ourselves updated with the current
fraternity. as well as the new laws being
introduced in a very holistic manner.

This encourages us to release a huge

number of White Papers regularly in
varied fields of laws and practice
areas like Arbitration, Data Privacy, Excellent research, drafting and eye
IBC, GST, Employment Laws, for detail are three of the most
Fintech, Data Privacy, IPR, important qualities for any lawyer for
Regulatory and General Corporate drafting and negotiation of a
Laws, etc. Contract and we truly believe that
such things help not just to make
All the members of our Firm work on your contract dispute free but also
White Papers with our extensive grow in the profession.
exposure of catering to different
industries and sectors. Let's learn together.

PAGE 01
 AHMEDABAD (H.O.)
India Offices 201-203, AMLEGALS, Westface, Near.
Baghban Part Plot, Zydus Hospital
Road, Thaltej - 380059, Ahmedabad
+91-84485 48549 | +91-8347853565

Kolkata
3rd Floor, Surabhi Building, 8/1/2 Loudon
Street, Kolkata- 700017, West Bengal,
India | +91-84485 48549 | +91-83478 53565 Surat
| kolkata@amlegals.com
B-502, Shreeji Arcade,
Anand Mahal Road,
Adajan, Surat | 84485-
48549 | 83478-53565 |
surat@amlegals.com

Gurgaon

RMZ Infinity, Udyog Vihar

Phase – IV, Gurgaon -
122001, India | +91-84485
48549 | +91-8347853565 |
gurgaon@amlegals.com
Mumbai
1201, Dalamal Tower, Nariman Point,
Mumbai - 400021, Maharashtra, India |
+91-84485 48549 | +91-8347853565 |
mumbai@amlegals.com

Pune
1203-05, Kumar Surabhi Building, Pune - Satara
Road, Next to Laxmi Narayan Theatre, Pune -
411009, Maharashtra, India | +91-84485 48549 |
+91-83478 53565 | pune@amlegals.com

Bengaluru
CoWrks NXT, Block 1B, RMZ NXT, EPIP, Whitefield
Main Rd, Industrial Area, Bengaluru - 560066,
Karnataka, India | +91-84485 48549 | +91-83478
53565 | bengaluru@amlegals.com
 International Desks

United States of
America

Bahrain
Hong Kong

UAE

Muscat

International Associates

United Kingdom

Netherlands

France

Singapore
United States Mauritius
of America
E-mail

info@amlegals.com

Website

www.amlegals.com