Court emphasizes minimal interference approach, referring procedural and arbitrability issues to Arbitral Tribunal
In a significant ruling, the Calcutta High Court has appointed a sole arbitrator to resolve the disputes between M/s. MHPL Infra JV and Rites Limited concerning the railway infrastructure works related to the Buxar Thermal Power Project in Chausa, Bihar. The judgment, delivered by Justice Gaurang Kanth, underscores the court's limited role in arbitration matters, focusing primarily on the existence of a valid arbitration agreement and whether the application for arbitration is timely.
The petition, filed under Section 11(6) of the Arbitration and Conciliation Act, 1996, sought the court's intervention in appointing an arbitrator due to unresolved disputes arising from contract execution issues, including delays and non-compliance allegations by both parties. The court noted that despite the complexity of the disputes and the significant monetary claims involved, its jurisdiction was confined to verifying the arbitration agreement and the timeliness of the application.
Justice Kanth highlighted the Kompetenz-Kompetenz principle, emphasizing that objections regarding procedural compliance and the scope of the arbitration clause are to be determined by the Arbitral Tribunal. The court appointed Mr. Sabir Ahmed as the Sole Arbitrator, directing him to address all jurisdictional and procedural challenges as preliminary issues.
The court also acknowledged the respondents' willingness to settle the disputes, encouraging both parties to explore settlement options even during the arbitration proceedings. This judgment reinforces the minimal interference approach advocated by the Supreme Court, allowing the Arbitral Tribunal to adjudicate substantive and procedural issues arising from the contract.
Bottom line:-
Section 11 of the Arbitration and Conciliation Act, 1996 - Court's scope of examination limited to verifying the existence of a valid arbitration agreement and whether the application is within the limitation period.
Statutory provision(s): Arbitration and Conciliation Act, 1996 Sections 11(6), 11(6A), 16, and 12.
M/s. MHPL Infra JV v. Rites Limited, (Calcutta) : Law Finder Doc id # 2922448
