Court denies writ petition challenging tribunal's jurisdiction, advises SAP to await final award for further challenges.
In a significant decision, the Bombay High Court has dismissed a writ petition filed by SAP India Private Limited challenging the jurisdiction of an Arbitral Tribunal in its ongoing dispute with Cox and Kings Limited. The division bench, comprising Justices Farhan P. Dubash and R.I. Chagla, ruled that judicial interference in arbitral proceedings is warranted only in exceptional cases of patent lack of jurisdiction or evident perversity.
SAP India had petitioned the court under Articles 226/227 of the Indian Constitution, seeking to overturn two orders by the Arbitral Tribunal dated March 31, 2025, and November 10, 2025. These orders had rejected SAP's applications under Section 16 of the Arbitration and Conciliation Act, 1996, challenging the tribunal's jurisdiction.
The crux of SAP's argument was that the counterclaim by Cox and Kings was filed under an agreement that had not been invoked for arbitration and differed from the one under which the Arbitral Tribunal was constituted. SAP contended that the tribunal had usurped jurisdiction it did not possess, as the counterclaim was related to a separate License Agreement, while the tribunal was appointed to adjudicate under a Services Agreement.
However, the court found that the Arbitral Tribunal acted within its jurisdiction. It interpreted the three agreements-Services Agreement, License Agreement, and General Terms and Conditions-as part of a composite transaction, thereby empowering the tribunal to entertain claims under all agreements. The court emphasized that no patent illegality was apparent in the tribunal's orders and that the proper course for SAP would be to challenge the final award under Section 34 of the Arbitration Act.
The court noted that SAP had already approached the Supreme Court and the Arbitral Tribunal with its objections, and further intervention at this stage was unwarranted. The judgment referenced several Supreme Court decisions, underscoring that interference is justified only in cases of manifest illegality or jurisdictional overreach.
The ruling is a reaffirmation of the limited scope of judicial review in arbitration matters, reinforcing the principle that arbitral autonomy should be respected unless a clear case of jurisdictional error is demonstrated. SAP India is now advised to await the final award before pursuing any additional legal remedies.
Bottom Line:
Judicial interference by writ courts under Articles 226/227 against orders passed by the Arbitral Tribunal is permissible only in exceptional cases of patent lack of inherent jurisdiction or perversity that is evident on the face of the record.
Statutory provision(s): Arbitration and Conciliation Act, 1996 Sections 16, 34; Constitution of India, 1950 Articles 226/227
SAP India Private Limited v. Cox and Kings Limited, (Bombay)(DB) : Law Finder Doc Id # 2833912
