Keeping Pace with Legal Change
The Supreme Court has established that pending criminal proceedings based upon allegations of “simple fraud” (like cheating or breach of trust) does not prevent arbitration proceedings from progressing; only cases alleging “serious fraud” or cases that challenge the validity of the arbitration agreement or that protect public policy will estop an individual from arbitrating a dispute.
In BGM and M-RPL-JMCT (JV) Vs. Eastern Coalfields Ltd., the Supreme Court said that enablement clauses, those containing words like “may” are not binding arbitration agreements within the meaning of Section 7 of the Arbitration and Conciliation Act, 1996. Rejected the appointment of arbitrator by the Calcutta High Court, and said that only unambiguous mandatory words generate enforceable arbitration agreements. This ruling improves contract drafting norms and restricts court’s referral powers to prima facie inquiry under Section 11.
Recently the supreme court of India made a landmark ruling on the interpretation and the existence of arbitration agreements especially…
In the case of Adavya Projects v. Vishal Structurals, the Supreme Court made it clear that the failure to serve Section 21 notice does not impede impleadment in arbitration provided the parties accepted to the arbitration agreement. This decision highlights the fact that the jurisdiction of the tribunal is derived from consent rather than from compliance with the procedures.
