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-Rohan Gulati* Introduction & Factual Background Recently, in Kanodia Infrastructure Ltd. v. Dalmia Cement (Bharat) Ltd.[1], the Hon’ble Delhi High Court (“High Court”) ruled that challenging the unilateral appointment of an arbitrator at the stage of setting aside the arbitral award under Section 34 of the Arbitration and Conciliation Act, 1996 (“1996 Act”) is not the right stage for doing so. The High Court opined that the scope of interference with the arbitral award is relatively narrow and it is permitted only when the arbitral tribunal exceeds its jurisdiction or travels beyond the scope of the contract. Insofar as the conspectus of the case was concerned, Kanodia Infratech Ltd. (“Petitioner”) and Dalmia Cement (Bharat) Ltd. (“Respondent”) agreed on a Memorandum of Understanding for the use of cement grinding plant at Bihar (“Plant”) by the Respondent. Due to conditional delays in the execution of the share purchase agreement, it was agreed that the Respondent could commence the operations at the Plant. Accordingly, multiple agreements were executed between the Petitioner and Respondent. For efficient functioning of the Plant, the entire gamut of operations and control was entrusted to the Respondent. Allegedly, the Petitioner was kept in the dark about the day-to-day operations and decisions made by the Respondent, which was troublesome for the Petitioner. One of the key obligations of the Respondent was to procure a clinker for the Plant, which it failed to fulfill. Thus, due to the lack of proper equipment, the Respondent was found to be running into losses and unable to run the Plant. Distraught, the Petitioner intended to terminate the commercial relationship with the Respondent. To further restrict the access of the Respondent, the Petitioner approached the High Court under Section 9 of the 1996 Act. However, the Respondent had invoked arbitration and appointed a sole arbitrator only a day prior to this petition. The Petitioner withdrew the petition with the liberty to approach the sole arbitrator under Section 17 of the 1996 Act. After hearings were concluded, the sole arbitrator passed an award in favor of the Respondent. Troubled with the decision, the Petitioner filed an application for setting aside the arbitral award. Judgment of the High Court Firstly, the Petitioner challenged the arbitral award on the premise that the Respondent held a unilateral power in the appointment process of the learned sole arbitrator. However, the High Court’s ruling goes to show that it considered the active participation of the Petitioner in the arbitration as a waiver to challenge the unilateral appointment of the arbitrator. The High Court highlighted multiple instances of the Petitioner’s participation: (i) Withdrawal of Section 9 petition (for interim measures from the court) from the High Court with the liberty to approach the sole arbitrator under Section 17 (interim measures from the tribunal) of the 1996 Act; (ii) Filing an application under Section 16 of the 1996 Act that challenged the composite reference of the disputes to arbitration (but not the appointment of the arbitrator); (iii) Filing of counterclaims during the arbitral proceedings; (iv) The Petitioner had also given consent for an extension of time under Section 29A(iii) of the 1996 Act for the completion of the proceedings. In view of the High Court, the abovementioned instances sufficiently established that the Petitioner had submitted to the jurisdiction of the sole arbitrator. Secondly, the High Court opined that despite the judgment of the Hon’ble Supreme Court of India in Perkins Eastman Architects DPC v. HSCC (India) Ltd.[2] (“Perkins”), the Petitioner did not object to the unilateral appointment of the arbitrator. Further, the learned single judge concluded by stating that since the award did not favor the Petitioner, it has approached the High Court at a belated stage. Thirdly, the High Court distinguished the authoritative judgments of the Supreme Court in Perkins and TRF Ltd. v. Energo Engineering Projects Ltd.[3] (“TRF Ltd.”) from the present matter on the basis of the stage of the proceedings. It categorically noted that the Supreme Court precedents were dealing with petitions filed under Section 11 at the pre-arbitral stage, whereas the present petition, being under Section 34, permitted only a narrow range of court interference. The High Court distinguished all the relevant precedents on this point alone. Fourthly, and significantly, the High Court set aside one claim involving compensation of Rs. 4 Crores that was granted in favor of the Respondent as it was considered to be distinct from all other claims. The High Court opined that this claim was wrongly granted by the learned sole arbitrator since it dealt with issues not contemplated by the parties in the arbitration. In view of the four-prongs discussed hereinabove, the High Court refused to set aside the arbitral award on the ground that the appointment of the sole arbitrator was unilateral and ruled that it was not open to the Petitioner to have challenged the same at the belated stage i.e., under Section 34 of the 1996 Act. Analysis Having dissected the judgment in four broad points, the stage is now set to first, explore the legislative avenues that are likely to entertain a challenge to the unilateral appointment even at a belated stage of Section 34; second, succinctly trace the judicial discourse on unilateral appointments so far; third, critically examine the decision of the High Court and critique it frame by frame. A. Legislative Avenues and Beyond It is trite to mention that the scope of interference exercised by the courts under Section 34 of the 1996 Act is relatively narrow and limited. Notwithstanding the scope of interference under Section 34, the doors must be left open in cases that challenge the unilateral appointment at the stage of setting aside the arbitral award. The reason for the same is founded on dual fronts viz., (i) an arbitration conducted by an ineligible arbitrator is non-est in law, and (ii) Section 34, though limited in its scope, would be open to burying the award in case of procedural irregularity that is clear as noonday. To elaborate on the first front, it is significant to note that in case an arbitrator lacked jurisdiction since the outset due to their unilateral appointment, any decision rendered by him would essentially be bereft of jurisdiction.[4] This would render the entire arbitral proceedings null and void, including the award. Therefore, if an award rendered by an ineligible arbitrator was to be challenged, it would be more susceptible to being set aside rather than being upheld. Significantly, in Bharat Broadband Network Ltd. v. United Telecoms Ltd.[5], the Supreme Court had observed that the de jure ineligibility of the arbitrator appointed by a person who is himself ineligible would render the appointment void ab initio. Consequently, the judgment reflects that any decision of the ineligible arbitrator would also be void regardless of the stage at which it has been passed by an ineligible arbitrator. On the second front, the phrase ‘procedural irregularity’ has been applied to expressly rely upon Section 34(2)(a)(v). A meticulous reading of this provision would reflect that where the composition of the arbitral tribunal, with or without the agreement of the parties, goes against the non-derogable provisions of Part I of the 1996 Act, the arbitral award may be set aside. Bearing this in mind, if the arbitration agreement conflicts with such non-derogable provisions, the former will cease to operate due to being invalid, thus opening the doors for the courts to set aside the arbitral award. It is further argued that a party is not precluded from raising the ground of unilateral appointment for the first time under Section 34 where there is an absence of an express agreement in writing that waives off the right to object.[6] This is in light of Section 12(5) of the 1996 Act, whose proviso sets a high standard of requirement – it mandates an express written agreement that would waive any reservation of the parties apropos any justifiable doubt about the arbitrator’s eligibility. It would also be safe to mention that there is nothing that precludes the courts from invalidating the arbitration agreement that conferred a unilateral right to one party alone at the stage of setting aside the arbitral award. After all, having a valid arbitration agreement is one of the basic and foremost tenets of any and every arbitration. In sum, there is nothing that precludes the courts from setting aside an award where the sole arbitrator was appointed unilaterally by one party alone. Despite being a belated stage, Section 34 should not withstand any procedural irregularity that goes against the letter and spirit of the 1996 Act. B. The Chronicles of Unilateral Appointment The judgment in Perkins is the most authoritative decision regarding unilateral appointments wherein the Supreme Court had unequivocally ruled that arbitration clauses that provide for the unilateral appointment of a sole arbitrator could not withstand the objectives of the 1996 Act i.e., to promote fairness and impartiality in arbitration. It also categorically held that if only one party has the right to appoint a sole arbitrator, its choice will always have an element of exclusivity in charting the course of dispute resolution.[7] Thus, unilateral appointment was held to be impermissible. Relevantly, in TRF Ltd. (a judgment before Perkins), the Supreme Court had gone one step ahead to observe that an appointment made by an ineligible arbitrator is also void ab initio. In other words, if an arbitrator was ineligible due to his past/present relationship with one of the parties in the dispute, even he could not appoint another arbitrator since his nomination is likely to reflect the individual’s interest in the outcome of the dispute. Notably, in Proddatur Cable TV Digi Services v. SITI Cable Network Ltd.[8], the Delhi High Court relied extensively on Perkins and ruled that even a company could not be a unilateral appointing authority in an arbitration agreement. It was further noted that despite party autonomy being a cornerstone of arbitration, the same could not override the principles of impartiality and fairness in arbitral proceedings.[9] C. Examining the Judgment of the High Court Reverting to the analysis of the High Court judgment, it is significant to point out that one of the primary reasons for refusing to set aside the award was perhaps the stage at which the Petitioner portrayed the challenge to the unilateral appointment. Bearing the same in mind, it is pertinent to move frame by frame. Firstly, the High Court erred in construing that the active participation of the Petitioner in the arbitral proceedings could be equated with a waiver to challenge the eligibility of the sole arbitrator. As discussed, Section 12(5) sets a high threshold criterion by requiring a written agreement that waives the reservations. In fact, it can be discerned from the factual matrix that the Petitioner at no point agreed to waive their reservation concerning the lack of consensus in appointing the sole arbitrator. Thus, merely filing applications before the sole arbitrator certainly does not indicate a waiver. On the contrary, the Petitioner showed a fair understanding of the process by withdrawing the Section 9 petition after becoming aware that the arbitral tribunal had been constituted which is precisely in accordance with Section 9(3) of the 1996 Act. Secondly, the High Court erroneously based its reasoning on the stage at which the Petitioner had challenged the unilateral appointment since any arbitral proceedings conducted by an ineligible arbitrator would be non-est in law. Additionally, by strictly following the observations of the Supreme Court in Perkins and TRF Ltd., any decision rendered by an ineligible arbitrator would fail to pass the muster of the law. Incidentally, in Ace Pipeline Contracts Pvt. Ltd. v. Bharat Petroleum Corp.[10], the Supreme Court had observed that where one party feels that the arbitrator has not acted independently and impartially, it would always be open for the aggrieved party to make an application under Section 34 praying for setting aside the award on the ground that the arbitrator acted with bias or malice in law or fact.[11] This is relevant as one of the core concerns surrounding unilateral appointment is the doubt of impartiality. However, even if we were to briefly assume that the Petitioner had raised the challenge to the unilateral appointment at a belated stage, it did not preclude the High Court from setting aside the award. The practice of unilateral appointment is such that it goes to the very root of the matter and poses a very high probability that the party making such appointment was conferred with an upper hand in charting the course for dispute resolution. Moreover, a challenge that is mounted against the unilateral appointment would not even warrant the courts to look into the merits of the case which would also keep the court within the bounds of Section 34. Thirdly, it can be discerned on merits that the High Court was well versed with the award and the claims submitted by the Respondent since an additional claim that was granted by the sole arbitrator was set aside. Bearing this in mind, the High Court erred in observing that the Petitioner was challenging the award since it was not granted in their favor. It is submitted that the Petitioner had raised valid grounds of challenging the arbitral award since it suffered from an element of bias due to the unilateral appointment. Therefore, there was no reason for the High Court to cast blame on the Petitioner when the arbitral award suffered from certain vices and possibly an element of bias. The thin line of difference between genuine award-debtors and frivolous ones must be appreciated and respected - even though the Petitioner might have arrived late did not mean that the doors of justice are closed on his face. Conclusion It is imperative to note that this judgment has conveyed something more than what meets the eye. One of the key takeaways from the present judgment lies in the adoption of a more active approach towards challenging the unilateral appointment and not waiting until the award is passed. A more pragmatic and appropriate avenue for challenging the unilateral appointment is by raising an objection via filing an application before the concerned court during the pendency of the arbitration itself. Whilst the 1996 Act does not prescribe any particular stage, the party must challenge the appointment of the arbitrator at the earliest stage and first possible instance to prevent any more wastage of time and resources. Implementing a pro-active approach by filing the application in a timely manner would also bolster the good faith nature of the suit and negate arguments of delaying the enforcement of the arbitral award. To conclude on the critique of the present judgment, the High Court was faced with a unique opportunity to expound and chart a better jurisprudence on this point of law. However, the High Court severely erred in its findings whilst it adopted a hands-off approach, which may prove to be counter-intuitive moving forward. It would also restrict the parties from challenging the unilateral appointment at the stage of setting aside the award despite the presence of appropriate legislative avenues and the absence of any specific restrictions (apart from the present judgment). To end, Jan Paulsson, one of the foremost practitioners to argue against the very concept of unilateral appointments had opined as follows: “…why should not every appointment be joint, or at least made from a list of individuals proposed by a similarly reliable institution? Above all, this attractive model is simply unrealistic with respect to the run of the mill of arbitration. And if arbitration cannot produce run of the mill quality, it will be condemned to function as an enclave of limited relevance.”[12] * Rohan Gulati is a Junior Staff Editor for the Arbitration Workshop Blog. He is currently a final-year student pursuing B.B.A. LL.B at Symbiosis Law School, Hyderabad. He can be contacted at rohan.gulati@student.slsh.edu.in [1] 2021 SCC OnLine Del 4883. [2] 2019 SCC OnLine SC 1517. [3] (2017) 8 SCC 377. [4] Shashank Garg, ‘Arbitrators’ under Distress: The Fate of Unilateral Appointments, (Bar and Bench, Jan 2020) accessed 15 November 2021. [5] (2019) 5 SCC 755. [6] Ramkishore Karanam and Mahasweta M., What is the Appropriate Stage to Challenge Unilateral Appointment (SCCOnline.com, Oct 2021) accessed 15 November 2021. [7] Supra note 2 at ¶ 16. [8] 2020 SCC OnLine Del 350. [9] Id., at ¶ 24. [10] (2007) 5 SCC 304. [11] Id., ¶ 21. [12] Jan Paulsson, Must We Live with Unilaterals? 1 ABA 5, 7 (2013).

Arnav Doshi[1] INTRODUCTION The arrival of the significant ruling in Delhi Airport Metro Express Private Limited v. Delhi Metro Rail Corporation Limited[2] (“Delhi Airport”) established the extent and scope of perversity or patent illegality as a ground available for annulment of an award granted by an arbitral tribunal. Section 34(2) of the Arbitration and Conciliation Act, 1996 (“the Act”) sets out grounds for setting aside of a domestic award whereas Section 48(1) and 57(1) embedded in Part II of the Act state the grounds for refusal of enforcement of a foreign award. However, a broad interpretation of patent illegality has led to its perfunctory use. In this recent Supreme Court judgment, the scope of patent illegality is revisited and revised to limit the scope of judicial intervention in the enforcement of awards as well as the extent of exercising patent illegality as a ground for setting aside arbitral awards. I. PATENT ILLEGALITY: GROUND FOR ANNULMENT The ground of patent illegality developed with the expansion of public policy exceptions for setting aside awards. Under Part I of the Act, Section 34(2)(b)(ii) states the refusal of a domestic award (Indian-seated arbitration) due to being in conflict with the public policy of India. Similarly, under section 48(2)(b)(ii) in Part-II(A) of the Act (for foreign-seated arbitrations under the New York Convention) and section 57(1)(e) in Part-II(B) (foreign seated-arbitrations under the Geneva Convention), the enforcement of the award could be refused by a judicial authority on the ground that it conflicted with the public policy of India.[3] The landmark case of Renusagar Power Co. Limited. v. General Electric Company[4]paved the way for the public policy exception prior to the enactment of the Act. Interpreting the doctrine of public policy, a three-pronged test was applied for refusal of an award contrary to public policy if such enforcement would be contrary to (i) fundamental policy of Indian law; or (ii) the interests of India; or (iii) justice or morality.[5] Scaffolding on the broadened understanding of public policy, it was ONGC v. Saw Pipes Limited[6] (“Saw Pipes”) that through purposive interpretation associated “patent illegality” as a subset of the public policy exception under Section 34 of the Act. The Division Bench explained that an award suffers from patent illegality when it was firstly against the provisions of the Act, secondly conflicting with statutory provisions of substantive law applicable to the parties to the dispute, or thirdly, when against the terms of the contract.[7] Thereafter, ONGC v. Western Geco International Limited (“Western Geco”) reaffirmed and upheld Saw Pipes, and added that illegality of the award must go to the root of the matter,[8] precluding illegality of trivial nature as a ground for contravening public policy. The 246th Report of the Law Commission based on the decision in Saw Pipes recommended the addition of section 34 (2A) to deal with purely domestic awards which may also be set aside by the Court if the Court finds that such award is vitiated by patent illegality appearing on the face of the award.[9] In finality, the Arbitration and Conciliation (Amendment) Act, 2015 (“2015 Amendment”) introduced Section 34(2A) whereby an award under Part I could be set aside on the grounds of “patent illegality appearing on the face of the award”. Post amendment, Ssangyong Engineering and Construction Company Limited v. National Highway Authority (NHAI) (“Ssangyong”) cabined the broad ground of patent illegality, as laid in Saw Pipes and 2015 Amendment, to postulate that the contravention of a statute not linked to public policy or the public interest, cannot be brought in by the backdoor when it comes to setting aside an award on the ground of patent illegality.[10] Ssangyong partly statutorily superseded the judgments in Saw Pipes and Western Geco. Subsequently, the notable case of Patel Engineering Limited v. North Eastern Electric Power Corporation Limited[11] (“Patel Engineering”) further followed Ssangyong to hold that the expansive interpretation to “public policy” in Saw Pipes and Western Geco to be no longer good law due to the 2015 Amendment. Narrowing the scope of patent illegality, Patel Engineering established two important points relating to the enforcement of awards in India. Firstly, pursuant to the recommendations of the Law Commission, the ground of “patent illegality” cannot be invoked in international commercial arbitrations seated in India.[12] Thus, foreign-seated arbitral awards cannot be annulled under the ground of patent illegality. Secondly, it crystallized a test for the application of patent illegality: “The ground of patent illegality is a ground available under the statute for setting aside a domestic award, if the decision of the arbitrator is found to be perverse, or, so irrational that no reasonable person would have arrived at the same; or, the construction of the contract is such that no fair or reasonable person would take; or, that the view of the arbitrator is not even a possible view.” Inching towards a pro-enforcement regime, Ssangyong and Patel Engineering acted as an integral step in ensuring a reasonable and prudent application of patent illegality as a ground for refusal of domestic award enforcement and thereby preventing its broad interpretation from opening a Pandora’s box of non-enforcement tendency. The subsequent step towards India’s pro-enforcement stance came with the Supreme Court’s judgment in Delhi Airport. II. FACTUAL MATRIX Delhi Metro Rail Corporation Limited (“DMRC”) proposed the implementation of the Airport Metro Express Line (“the Line”) from New Delhi Railway Station to Dwarka Sector 21 via Indira Gandhi International Airport, New Delhi. It was decided to develop the project by engaging a concessionaire for financing, design, procurement, installation of all systems. On 25.08.2008, a Concession Agreement was entered between DMRC and Delhi Airport Metro Express Private Limited (“DAMEPL”) for design, installation, commissioning, operation and maintenance of the project. The dispute originated when DAMEPL vide a letter wrote to DMRC regarding issues relating to the design and quality in the installation of viaduct bearings in the Line. However, DMRC responded with a letter stating that upon carrying out inspections, no bearings were found to be damaged. A notice was issued by DAMEPL on 09.07.2012, asking DMRC to cure the defects in DMRC’s works within a period of 90 days from the date of the notice, failing which it shall be treated as a breach having Material Adverse Effect on the Concessionaire under the Concession Agreement.[13] Additionally, a ‘non-exhaustive list of defects’ was stated in the aforementioned notice. Thereafter, DAMEPL issued a notice terminating the Concession Agreement under the reason that the defects highlighted were not cured. DMRC invoked arbitration under Article 36 of the Concession Agreement which refers to the dispute resolution mechanism to be adopted. The main issue of determining the validity of the termination of the Concession Agreement arose before the Tribunal. In turn, DAMEPL filed a counterclaim on the ground that DMRC did not cure the defects pursuant to the notice dated 09.07.2012. The Tribunal, in so far as the defects are concerned, concluded that 72 % of the girders were affected by such cracks,[14] and held that DMRC was in breach of the Concession Agreement. Ergo, the termination notice issued by DAMEPL was valid. As compensation for the upheld counterclaim, the Tribunal Tribunal worked out ‘Adjusted Equity’ at Rs.983.02 crore and awarded a total amount of Rs.2782.33 crore, along with further interest, as Termination Payment to be made to DAMEPL.[15] Pursuant to the arbitral award, DMRC filed an application under Section 34 of the Act for setting aside the award, which the Single Judge of the Delhi High Court dismissed. DMRC filed an appeal under Section 37 of the 1996 Act read with Section 13 of the Commercial Courts Act, 2015 challenging the correctness of the judgment passed by the learned Single Judge. In the appeal and via an SLP, the Division Bench reversed the impugned judgment, and the arbitral award was partly set aside. DAMPEL filed an SLP challenging the intervention of the Division Bench in setting aside the award. The primary reason for the reversal was that the Tribunal had based its reasoning on the validity of the termination notice on two different dates leading to confusion and ambivalence as to the termination notice and the date of termination. III. OUTCOME The main issue before the Supreme Court was whether the Division Bench of the Delhi High Court had erred in their exercise of power under Section 37 of the Act and thereby setting aside the Tribunal’s award. The Supreme Court examined the contours of the court's power to review arbitral awards and held that the Act and the 2015 Amendment was enacted to limit judicial interference vis-à-vis setting aside of domestic awards to the grounds under Section 34 of the Act,[16] emphasizing on the decision in Ssangyong. The Court held that every error of law committed by the Arbitral Tribunal would not fall within the expression ‘patent illegality’. Likewise, erroneous application of law cannot be categorised as patent illegality.[17] That apart, several judicial pronouncements of this Court would become a dead letter if arbitral awards were set aside by categorising them as perverse or patently illegal without appreciating the contours of the said expressions.[18] Therefore, the Court set aside the decision of Division Bench and upheld the Rs. 2,782 crore arbitral award to make DMRC compensate DAMEPL. CONCLUSION Having emerged from the stable of public policy, patent illegality is now a separate and self-sufficient tool for challenging domestic awards under Section 34 of the Arbitration and Conciliation Act.[19] The Apex Court, at the present instance, reinforced the well-settled application of the ground of patent illegality under Section 34(2A). Moreover, it addressed the “disturbing tendency” of courts setting aside arbitral awards. The jurisprudential development evidenced a discernible trend of courts setting aside awards owing to the broad ambit of patent illegality with Saw Pipes and Western Geco. However, following the principles set in a series of judgments- from Associate Builders, Ssangyong to Patel Engineering, the Supreme Court in Delhi Airport steered the course towards a pro-enforcement regime by establishing the scope of judicial intervention in enforcement proceedings and limiting the corrosive appeal to patent illegality as a ground for annulment of domestic awards. [1] Arnav Doshi is a Junior Staff Editor for the Arbitration Workshop. He is a third-year student pursuing B.B.A. LL.B. (Hons.) at O.P. Jindal Global Law School. He can be reached at 19jgls-arnav.jd@jgu.edu.in. [2] Civil Appeal No. 5627 of 2021. [3] Abhijeet Shrivastava and Anujay Shrivastava, Scope of ‘Patent Illegality’ in Refusing Enforcement of Arbitral Awards, IndiaCorpLaw (September 30, 2020), https://indiacorplaw.in/2020/09/scope-of-patent-illegality-in-refusing-enforcement-of-arbitral-awards.html. [4] (1994) Supp (1) SCC 644. [5] Renusagar Power Co. Ltd. v. General Electric Company and Another, (1994) Supp (1) SCC 644, ¶66. [6] (2003) 5 SCC 705. [7] ONGC v. Saw Pipes Limited, (2003) 5 SCC 705, ¶74. [8] ONGC Limited v. Western Geco International Limited, (2014) 9 SCC 263, ¶34. [9] Law Commission of India, Amendment to the Arbitration and Conciliation Act, 1996, Report No. 246, 21 (Aug, 2014). [10] Ssangyong Engineering and Construction Company Limited v. National Highway Authority (NHAI), (2019) 15 SCC 131, ¶37. [11] (2020) 7 SCC 167. [12] Patel Engineering Limited v. North Eastern Electric Power Corporation Limited, (2020) 7 SCC 167, ¶19. [13] Delhi Airport Metro Express Private Limited v. Delhi Metro Rail Corporation Limited, Civil Appeal 5267 of 2021, ¶6. [14] Ibid at ¶11. [15] Ibid at ¶13. [16] Ibid at ¶22. [17] Ibid at ¶25. [18] Ibid at ¶24. [19] Khaitan & Co., Patent Illegality: Supreme Court Travels a Long Road To Tame a Herd of Unruly Horses, Lexology (July 16, 2020), https://www.lexology.com/commentary/arbitration-adr/india/khaitan-co/patent-illegality-supreme-court-travels-a-long-road-to-tame-a-herd-of-unruly-horses.

Abhijeet Kumar[1] Introduction 1. In works contract, delays and prolongation are inevitable which are entered into for long projects. Prolongations often result in economic hardships. If the terms of the contract provide for recourses or alternatives to address such hardships, then the reliefs are accordingly availed by the affected party. However, if the contract doesn't explicitly provide for recourse in event of such prolongation, then uncertainty and a complex dispute arises for ascertaining the breach, the damage and compensation thereof. Such projects have an arbitration clause for the resolution of disputes. This piece shall attempt to highlight the claims which arise in the event of prolongation of works contract, with a specific focus on construction contracts, and the extent to which an arbitral tribunal can decide upon the damages in the event of prolongation. Loss of Profit Claims 2. As the term signifies loss of profit is a reduction in profit earning of an entity. In a works contract reduction of profit can occur due to several reasons. For instance, the cost of input of the contractor may increase from what has been anticipated when the contract was entered into, such expenditure is a direct expenditure of the contractor towards the contract. Similarly, the allied expenses of the contractor which are called overhead expenses may also increase during the working of the contract. Each of these will result in lesser profit generated by the contractor if the consideration of the contract has been fixed during the time the contract was entered into. If the terms of the contract do not provide for additional payment to the contractor on account of varied input cost (escalation), the contractor does not have the right to get his losses mitigated even if he incurs a loss in the contract owing to the fluctuation in input cost either on direct input costs or indirect input costs during the term as agreed in the contract. 3. However, if the contract is breached by the owner and thereby the contractor is unable to carry out the work as agreed in the contract this would result in the contractor losing his profit margin in the contract. This would be damage caused to the contractor against which he can claim compensation. 4. In A. T. Brij Paul Singh v. State of Gujarat, (1984) 4 SCC the Hon’ble Supreme Court held that “When a contractor bids for a tender, he expects to earn some profit if his bid is accepted and thereon a works contract is entered into. If the upon execution of such a work contract, the owner/parties entrusting the work commits a breach of contract, the contractor would be entitled to claim damages for loss of profit against the profit he expected to earn in the contract. For evaluation of loss to contractor, minutest details need not be examined a broad evaluation would be sufficient.” 5. Thus, in the event of breach by the owner a contractor is entitled to get his damages mitigated in terms of compensation against the profit which he would have gained had the contract been performed. Effect of Prolongation of Contract. 6. However, the position of law changes in event of prolongation of the contract i.e. if the contract could not be completed within the time stipulated in the terms of the contract. When the contract is prolonged by the owner, the capacity of the contractor to undertake other projects/ventures is diminished and thereby his profit-earning capacity is affected as well. Further, owing to the prolongation, expenditure on inputs increases and thus profit decreases. Remedies in cases of prolongation in terms of compensation are available against damage suffered. 7. If the prolongation of a Contract is on account of delay by the contractor, generally the contract explicitly provides for damages to be claimed by the owner/employer in such an event. However, if the delay is caused due to faults of the owner case law jurisprudence for damages due to prolongation of work contract comes into the picture. 8. Following are the heads of damages which are generally sought on account of prolongation of contract beyond the agreed period of the contract; a. Loss of profit b. Compensation for increased overhead expenses c. Compensation for escalation of price d. Compensation for loss due to idle machinery or reduction in productivity. a. Loss of profit. 9. This loss of profit is not the same as the loss of profit mentioned above in event of a breach of contract. In cases of prolongation of works contract, i.e. breach of the term of the contract to completion within the stipulated time, the prolongation itself doesn't give a rise to claim. To establish the claim for loss of profit due to prolongation of contract, the existence of opportunity is to be established to say that had the contract been timely acted upon the claimant would have earned additional profits given its available resources. In NHAI v. IJM Gayatri Joint Venture 2020(3) Arb LR 463 (Delhi), the Hon’ble Delhi High Court held that “A party should prove, existing opportunity, and that it could not avail the said opportunity due to prolongation which resulted in loss to such the party. The loss would have to be quantified and proved.” 10. For the claim of loss of profit, the certainty of existing opportunity and quantified losses suffered shall be proved. On these lines, the Hon’ble Supreme Court in Bharat Coking Coal Ltd. v. L.K. Ahuja, (2004) 5 SCC 109 has held that "It is not unusual for the contractors to claim loss of profit arising out of diminution, in turn, over on account of delay in the matter of completion of the work. What he should establish in such a situation is that had he received the amount due under the contract, he could have utilized the same for some other business in which he could have earned profit. Unless such a plea is raised and established, a claim for loss of profits could not have been granted. In this case, no such material is available on record. In the absence of any evidence, the arbitrator could not have awarded the same." 11. To assess the quantum of loss of profit, reliance is placed on formulas that are recognized in construction contracts namely: Hudson, Emden Formula, Eichleay Formula. These formulas are also relied upon to assess the quantum of increased expenditure on overhead expenses during the period of prolongation. The same was approved by the Hon’ble Supreme Court in McDermott International Inc. Burn Standard Ltd. and Ors. (2006) 11 SCC 181 (“McDermott case”). b. Compensation for increased overhead expenses 12. When the arbitral tribunal rejects the claim for increased overhead expenses during the prolongation period on account of no evidence then the Courts tend to uphold such decisions of the Tribunal. The Hon’ble Delhi High Court in Indo Nabin Projects Ltd. v. Powergrid Corporation of India Ltd., 2018 SCC OnLine Del 8405 held that “Standard formulae is an essential tool for computing loss of profit and overhead expenses. However the Arbitral Tribunal is not bound to apply these formulae in every case and absolve the claimant form producing any other material to establish the claims of loss on account of overheads/loss of profit. A claimant should also establish that it incurred overhead expenses on account of prolongation of works contract.” 13. With respect to claim against increased overhead the burden on the claimant of proving enhanced overhead expenses is limited to establishing prolongation of the contract period. If prolongation is proved then the formulas may be applied and thereon compensation can be claimed. Though no statute explicitly provides for applying such formulas but in absence of any impediment, it is acceptable as held by the Hon’ble Supreme Court in McDermott International Inc. Burn Standard Ltd. and Ors (2006) 11 SCC 181. The Supreme Court in this case held that it is left to the discretion of Arbitral Tribunal to determine which formula shall be applied taking into account the facts and circumstances of the case. But the formula for ascertaining increased overhead should be a standard formula one of 3 mentioned in McDermott case. The Hon’ble Delhi High Court in SMS Ltd. v. Konkan Railway Corporation Ltd. MANU/DE/1023/2020, when an unknown formula namely “notional proportionate loss” was applied for ascertaining loss on account of increased overhead and idleness of machinery, set aside the award on account of patent illegality. 14. However, if Arbitral Tribunal denies overhead expenses on account of lack of evidence and states that owing to the lack of evidence of overhead expenses the standard formulas itself cannot be applied. Such refusal of the award has been upheld in the case of Essar Procurement Services Ltd. vs. Paramount Constructions MANU/MH/2511/2016. The Court held that “the award for overhead expenses merely based on the Hudson Formula and not based on any evidence is patently illegal and in conflict with public policy.” c. Compensation for escalation of prices. 15. In event of prolongation if the prices of direct inputs of the contractor escalates then in such an event if there is any term in the contract concerning such escalation that would prevail. If the contract provides that "the above price is firm and is not subject to any escalation under whatsoever ground till the completion of the work, Then in such a contract, the arbitral tribunal cannot award any compensation despite the escalation beyond the term stipulated as was held by the Supreme Court in New India Civil Erectors (P) Ltd. v. Oil & Natural Gas Corporation, (1997) 11 SCC 75 (“Erectors case”). The Hon’ble Supreme Court recently in NTPC Ltd. v. Deconar Services Pvt. Ltd. AIR 2021 SC 2588 while referring to Erectors case held that construction of the contract is in the domain of Arbitrator and in the view of the said clause arbitrator had rightly denied price escalation in Erectors case. 16. However, the Hon’ble Supreme Court in Food Corporation of India v. A.M. Ahmed & Co. and Anr., (2006) 13 SCC 779 has held that when there is no escalation clause in the contract and the performance of the contract is delayed, then in such a situation, the Arbitral Tribunal upon determination of delay and determination of the escalation of price during the delayed period, can grant compensation for such escalation, if the delay has been caused by the Respondent. 17. It is evident from the abovementioned precedents that if the intent of fixed price for the entire work in a works contract regardless of time taken can be ascertained from the terms of the said contract, then price escalation cannot be granted even if the performance of contract is delayed. On the contrary, if the Contract is silent with respect to price escalation and the performance is delay, then despite the absence of any escalation clause, the aggrieved party can be granted compensation for price escalation on account of delay in performance of the Contract. 18. In another, interesting set of circumstances, the original contract did not provide for price escalation, however, the supplement agreement extending the time for execution provided a prohibition on any claim of price escalation. The Supreme Court of India in K.N. Santhyaapalan (Dead) by Lrs. v. State of Kerala and Ors., 2006 (4) ArbLR275 held that when the owner couldn’t provide necessities for the execution of work as agreed in the contract. The court upheld the award of arbitrator granting claims against price escalation despite there being express prohibition in the supplementary agreement. The reason appears to be that the intention of any legal obligation of the party entering into the first contract and a subsequent one in order to save the first one cannot be the same. In the sense that the parties to a contract would certainly be free in terms of the influence of losing something on their decision-making w.r.t. entering into a new contract but once the contract has prolonged the parties might already be losing and thus to save it, they entered into a supplementary agreement. This ingredient of compulsion appears to have played a role in the decision of the Court to uphold the award. 19. Thus, the takeaway from the aforesaid discussion is that, in absence of any bar on price escalation in the contract, the Arbitral Tribunal will have jurisdiction to grant compensation to the Claimant against damages suffered due to prolongation of the contract. However, an explicit bar on such a claim until the completion of the contract would prohibit this claim. In such instances of delay, the intent of keeping the prices fixed can be ascertained as understood by the dictum of the apex court in Erectors case. 20. Such strict interpretation of a clause barring price escalation in event of delay can often go significantly detrimental to the interest of the aggrieved party. For instance, if the performance of the works contract is delayed on account of the fault of the owner even for a decade then also the clause fixing the price until completion of the contract would be effective against price escalation. The contractor might not have anticipated such inordinate delay while agreeing to such a term but will have to face the consequences thereof. Thus the dictum of the apex court in Erectors case might need a reconsideration if peculiar facts of a case crop up wherein the bar on price escalation is used to exploit the interest of the contractor for a prolonged period of time. d. Compensation for loss due to idle machinery or reduction in productivity. 21. In M/s National Highways Authority of India v. M/s Hindustan Construction Company, MANU/DE/0438/2016, the Hon’ble Delhi High Court has held that Reliance on the Ministry of Road Transport & Highway's Standard Data Book is an accepted mechanism for assessing the loss due to idle machinery. Against the underutilization of machinery during the prolongation of the contract, the contractor can claim damages to the tune of underutilization. For allowing this claim the Arbitrator only need to ensure that there was idleness of the machinery and the owner is responsible for prolongation. Even if actual damages in terms of money cannot be ascertained in such situation the Standard Data Book of the Ministry of Road Transport & Highways can be relied upon which provides for rates of several types of machinery deployed in construction activities. However, the Delhi High Court in Union of India v. Om Construction Co., 2019 SCC OnLine Del 9037 has held that if the contractor also equally prolonged and the prolongation is attributable to both the parties equally then the damages under this head cannot be awarded. Thus it can be said that once the contractor has mobilized its machinery and brought it on to the site, then his losses due to idleness of such machinery on account of prolongation by owner’s fault will be compensated. Overlapping of Claims of loss of profit and extra expenses incurred 22. There can be a loss of profitability on account of various factors in event of prolongation of the contract. However, the recourse to seek damages against all such losses if brought under the purview of loss of profit will result in overlapping of claims. Moreover, for the loss of profit claim to be awarded, the burden of proof is relatively higher as opposed to the other claims such as increased overhead, price escalation, losses due to idle machinery. The proof of alternative venture in claims of loss of profit is mandatory. 23. In M/s National Highways Authority of India v. M/s Hindustan Construction Company, MANU/DE/0438/2016, the Hon’ble Delhi High Court has distinguished the claim for loss of profit and loss of earning capacity as “The court distinguished loss of profit and earning capacity, loss of earning capacity means the loss suffered by contractor due to his inability to deploy his manpower, plant, machinery at another venture deployed at the site during the extended period.” 24. Thus, it can be said that the claims of loss of profit as discussed above is essentially loss of earning capacity and the rest are losses suffered to profitability on account of enhanced expenses due to prolongation. 25. Similarly, in NHAI v. IJM Gayatri Joint Venture 2020(3) Arb LR 463 (Delhi) the Delhi High Court held that when the compensation for delay in payment and extra work was paid, additional claim of loss of profit is to be denied. 26. Therefore, if the claims in any manner are encroaching upon ingredients of each other to the extent of such overlapping the awards of the arbitral tribunal will be set aside under Section 34 of A&C, Act. Conclusion 27. While claiming account of losses suffered due to prolongation of contract certain things shall be kept in mind. The requirement of evidence for claims under the head of loss of profit is relatively higher given it requires an existing opportunity. As far as the requirement of evidence against claims of overhead expenses, idle/underutilized machinery is concerned prolongation on account of fault of other party i.e. the owner shall be proved by the contractor. Accordingly, if the counsel for such aggrieved contractor shall in an arbitration decides to proceed with claim under head of overhead expenses, idle/underutilized machinery burden of proof would be relatively lesser as against under the head of loss of profit. At the same time the Arbitrators are required to be cautious that claims of loss of profit are not sought under the guise of overhead expenses or idle machinery in order to escape the requirement of evidence. 28. Overlapping of claims before a tribunal can subsequently be set aside. Thus, even though increased expenses on idle machinery, price escalation, increased overhead expenses might result in decreased profit. It shall not be claimed under the head of "loss of profit". Moreover, overlapping of claims shall be avoided. 29. Further in the light of Ssangyong Engineering and Construction Co. Ltd v. NHAI (2019) 15 SCC 131 (“Ssangyong case”), which states that an award arrived at without any evidence would be liable to set aside, it would be interesting to see whether the evidence of delay for claims of increased overhead expenses, losses due to idle machinery owing to the prolongation of works contract is sufficient or actual damages will have to be established. Presently it appears that if the Arbitral Tribunal awards claim under heads of increased overhead expenses, idle machinery either only on the evidence of prolongation or deny on account of non-availability of the alternative venture, both kinds of awards are not interfered by the court and Arbitral Tribunal's discretion is allowed to prevail. This position of law appears to have created an anomaly because virtually both of the views of Arbitral Tribunal stands approved by the courts. The necessity of evidence as envisaged in Ssangyong case may be incorporated in claims of damages on account of overhead expenses & idle machinery, this would give a certainty to the jurisprudence of these claims. The extent to which evidence is essential if defined by the court would also be fruitful in bringing certainty with respect to claims on account of overhead expenses and idle machinery. [1] 4th Year, 7th Semester B.B.A., LL.B.(Hons.) student at Chanakya National Law University. Email – abhijeetcnlu23@gmail.com

Harshvardhan Tripathi [1] Introduction The readers of arbitration law would be well aware that consent is considered the “cornerstone” of international arbitration. However, arbitrators are often presented with cases involving individuals and entities that did not intend to be bound by the arbitration agreement. This is sometimes referred to as “extending the arbitration clause”, “joining non-signatories” or simply as “joinder” of the non-signatories. When faced with such cases, the arbitral tribunals rely upon theories developed by courts and tribunals across jurisdictions that justify binding non-signatories in certain circumstances, such as when the fact of the case demonstrates that the non-signatory intended to be a party to the arbitration agreement. These theories have emanated from the contract law jurisprudence of countries of both civil law and common law tradition. While the theoretical bases of involving non-signatories has received a varying degree of support across jurisdictions, their application remains fact-specific and their frontier continues to expand as more and more novel fact situations are encountered. In his commentary on International Commercial Arbitration (3rd edn, Wolters Kluwer 2020), Professor Gary Born has neatly categorized the more prevalent theories into purely consensual and non-consensual theories. The purely consensual theories include the theory of agency, implied consent, assumption, assignment and a third-party beneficiary. On the other hand, the non-consensual theories include the theory of estoppel and alter ego. Without delving into the particulars of each theory, it should be noted at this point that the underlying purpose of these theories is to achieve the pragmatic end of bringing together all such parties that are closely connected, and therefore, relevant to the dispute before the Arbitral Tribunal. The Tribunal is better positioned to dispense a just award when the relevant entities and individuals are involved in the arbitration proceeding. Besides the legal aim of attaining just outcomes, joinder of relevant entities or individuals also enhances commercial efficiency by saving time, limiting costs, preventing parallel litigations in various forums and subsequent conflicting decisions by different forums etc. Enforcement of foreign arbitral award against Non-signatories If a third party either wishes to join the arbitration proceedings or avoid being joined to the arbitration proceedings, it can approach the Courts of the seat of arbitration. These Courts would apply the lex arbitri and determine if there is any legal and factual basis for allowing or refusing such a joinder[2]. However, the situation is different in those cases where an arbitral award has been issued against the non-signatory and it has not challenged the award in the courts of primary jurisdiction. Now, the non-signatory is resisting the enforcement of the foreign award before the enforcing court because it did not consent to be bound by the arbitration agreement. The enforcing court is then faced with several puzzling questions, such as whether it should defer to the arbitral tribunal's decision with respect to whether the non-signatory was or became, in fact, or by operation of law, a party to the arbitration agreement. Or should the court conduct an independent review to satisfy itself that the non-signatory legitimately became a party to the arbitration agreement? Does the burden of proof rest with the non-signatory to demonstrate to the enforcing court that it was not a party to the arbitration agreement? Or should the enforcing party affirmatively prove before the enforcing court that the non-signatory was, or should be treated as, a party to the arbitration agreement? These questions inter alia other intriguing issues were discussed by the Supreme Court of India in the 2021 decision of Gemini Bay Transcription Pvt. Ltd. v. Integrated Sales Service Ltd. &Anr. (‘Gemini Bay’) By examining the decision in Gemini Bay in light of the legislative framework of the Arbitration and Conciliation Act, 1996 (‘Indian Arbitration Act’) and legal position in England, Australia, and Singapore, the author intends to take a deeper look into the vexatious position surrounding enforcement of foreign awards against non-signatories in India in this article. So far, the commentary on Gemini Bay has lauded it as another instance of the ‘pro-enforcement’ stance of the Indian Courts because it facilitated speedy enforcement of foreign arbitral awards in India and minimized intervention of the domestic courts in this regard. However, the author in this article wishes to highlight that Gemini Bay has exposed a glaring loophole in the Indian Arbitration Act. The provisions concerning enforcement of a foreign award in Part II of the Act leave the non-signatories in a precarious condition by not allowing them an opportunity to resist enforcement in Indian Courts. While parties to the arbitration agreement are provided with an opportunity to resist enforcement, it is unfair that the individuals and entities that did not even intend to be bound by the arbitration agreement are not accorded the opportunity to do the same. Furthermore, it is highlighted how Gemini Bay diverges from the consistent interpretation of the New York Convention (‘NYC’) globally and makes India a convenient forum for claimants to easily target non-signatories because of the mechanistic approach of the Indian Courts in enforcing foreign awards against non-signatories. Gemini Bay: An introduction A Hong Kong-based company named ‘Integrated Sales Services Limited’ (‘ISS’) signed a Representation Agreement (‘RA’) on 18th September 2012 with an Indian company based in Nagpur named ‘DMC Management Consultants Limited’ (‘DMC’). This agreement was signed by Mr. Rattan Pathak on behalf of DMC. Later during a subsequent amendment, one Mr. Arun Dev Upadhyaya, signed the agreement on behalf of DMC. As per the RA, ISS was obligated to assist DMC in its efforts to sell its goods and services to prospective customers. Furthermore, ISS was also obligated to identify potential investors and assist DMC in negotiating contracts. Under the RA, ISS was to receive a commission for its services. The RA stipulated that the agreement was subject to the laws of Delaware, USA and that every dispute arising in connection with the agreement was to be resolved by referring the dispute to a Sole Arbitrator in Kansas City, Missouri, USA. Disputes arose between the parties and ISS alleged that as per the terms of the RA, it had introduced two customers- MedQuist Transcription Ltd. based in New Jersey USA, and AssistMed Inc. based in California USA, to DMC. But Mr. Upadhyaya had diverted the business of these two customers away from DMC and directed it to other companies owned by him and his family members- Gemini Bay Consulting Ltd. (“GBC”) and Gemini Bay Transcription Private Ltd. (“GBT”). This act of diversion by Mr. Upadhyaya deprived ISS of the commission it was owed as per the terms of the RA. ISS initiated Arbitration proceedings on 22nd June 2009 against DMC and DMC Global and impleaded Mr. Upadhyaya, GBC and GBT as respondents. ISS contended that Mr. Upadhyaya was a proper party to the arbitration and his joinder was justified because Mr. Upadhyaya personally controlled the overall operations of DMC and other respondent companies. GBC and GBT were companies owned by the relatives of Mr. Upadhyaya and the Board of directors of these companies acted as per the instructions of Mr. Upadhyaya. Procedural History The Foreign Arbitral Award At the conclusion of the Arbitration proceedings, an award was passed in favour of ISS to the quantum of USD 690 million, which was to be paid jointly by DMC, DMC Global, Mr.Upadhayay, GBC and GBT. The primary justification behind including Mr.Upadhayay, GBC and GBT as appropriate parties in the arbitration proceeding and putting an obligation on them to pay ISS the abovementioned sum of the award was the application of the ‘alter ego’ doctrine. Motion for enforcement in the Indian Courts 1. Judgment of the Single Judge of the Bombay HC ISS moved an application under Section 48 of the Indian Arbitration Act in the Bombay High Court for the enforcement of the foreign award. The Single Judge ruled that in the present case, the foreign award is enforceable only against DMC and not other respondents because they were non-signatories to the arbitration agreement and therefore not bound by the enforcement award. 2. First Appeal: Judgement of the Division Bench of the Bombay HC ISS appealed the ruling of the Single Judge. When the matter came before the Division bench, it reversed the judgment and held that the enforcement of the foreign award could only be resisted under Section 48 if the Arbitrator had not applied the Delaware Law on the alter ego principle correctly. After examining the veracity of the application of Delaware Law, the Division bench was convinced that it was applied correctly and therefore the award was enforceable not only against DMC but also other Gemini entities. 3. Second Appeal: Judgement of the division bench of the Supreme Court Now, GBT, GBC and Mr. Upadhyaya moved to the Supreme Court by a special leave petition (SLP) and appealed against the decision of the Division bench of the Bombay High Court. An overview of the Supreme Court’s verdict: The Supreme Court heard the contentions of both sides and observed the following with respect to the provisions of the Arbitration Act: 1. Section 47(1) (c): (Paragraph 37) This provision is strictly procedural in nature and the award creditor needs to satisfy only the three pre-requisites for the enforcement of the foreign award. The award creditor does not have to adduce evidence to prove that the foreign award binds the non-signatory at the stage of enforcement before the Indian Courts. 2. Section 48(1) (a): (Paragraph 42 and 57) Non-signatory’s challenge to the enforcement of foreign awards does not fall within the ambit of this provision. If such a challenge were to be allowed to be raised, it would require revisiting the merits of the case which is not permitted in light of the pro-enforcement bias of the New York Convention and the Indian Arbitration Act. 3. Section 48(1) (b): (Paragraph 58 and 63) This provision concerns instances that occur before the making of the award and does not include the ground of absence of reasons or perfunctory reasons given in the foreign award. 4. Section 48(1) (c): (Paragraph 60) This provision is strictly concerned with situations where the foreign award has determined issues beyond the scope of the arbitration agreement and does not apply to the present case. 5. In light of the phrasing in Section 44 which mentions ‘differences arising out of legal relationships, whether contractual or not’ even tort claims can be determined by the arbitrator. (Paragraph 66 and 67) 6. Appellants cannot raise the ground of the foreign award being violative of the substantial law of the agreement before the enforcing court. Only the Courts at the seat of the arbitration have the jurisdiction to determine such questions. (Paragraph 71) 7. Section 48(1) cannot be invoked in instances where damages have been awarded without forwarding any reason. It is possible to invoke Section 48(2) but the scope of such invocation would be very narrow and will only apply to cases of gross injustice that shocks the conscience of the court. (Paragraph 74) Refusing the objection of non-signatories with respect to enforcement of the foreign award against them: In line with the global trend or a divergent approach? In the present case, the appellant sought to convince the Court that the judicial trend with respect to enforcement of foreign awards against non-signatories globally has been that the enforcing court conducts an independent review of the findings of the arbitral tribunal. The enforcing court confirms the conclusion of the tribunal that the non-signatory is indeed a party to the arbitration agreement before allowing for enforcement of a foreign award against it. The decision by the Supreme Court of the UK in Dallah Real Estate and Tourism Co v Ministry of Religious Affairs of the Government of Pakistan and the decision of the Supreme Court of Victoria in IMC Aviation Solutions Pty Ltd. v AltainKhuder LLC was cited to support the approach of scrutiny. Although this approach did not find favour with the Indian Supreme Court because it distinguished these case laws from Gemini Bay based upon the facts and the law, it is pertinent to note that the overwhelming majority of case laws in different civil and common law jurisdictions support the ‘Dallah principle’. Besides Dallah and IMC Aviation, a Norwegian case by the Halogaland Court of Appeal [3] (“the Halogaland case”), the decision of the Irish Supreme Court in Peter Cremer Gmbh& Co. v Co-operative Molasses Traders Ltd, decision of the British Columbia Supreme Court in Javor v Francoeur, decision of the Second Circuit Court of Appeals in Sarhank Group v Oracle Corporation, and decision of the English Court of Appeal in Svenska Petroleum Exploration AB v Government of the Republic of Lithuania lend credence to the position that instead of echoing the Arbitrator’s finding on the issue, the enforcing court should conduct an independent inquiry on whether the non-signatory intended to be bound by the arbitration agreement. Similar to the Indian Supreme Court’s opinion, it can be argued that these case laws are not of persuasive value before Indian courts because of the difference between the Indian Arbitration Act with the Arbitration Acts in other jurisdictions. The Indian Supreme Court correctly distinguished the difference in the provisions surrounding enforcement of foreign awards in the Indian Arbitration act from the statutes in England and Australia. However, it interpreted the provisions in the Indian Arbitration Act sui generis and did not consider the fact that the national arbitration legislations are not strictly national in their essence and rather give effect to the principles and provisions of the New York Convention. Moreover, it is not uncommon for the Indian Courts to look at other advanced arbitration-friendly jurisdictions and their burgeoning case laws for direction and place reliance upon them whenever necessary. For instance, in the 2014 landmark ruling of the Supreme Court of India in Enercon (India) Ltd and Ors v Enercon Gmbh and Anr the Court heavily relied on the ratio of Naviera Amazonica Peruana S.A. v Compania Internacional De Seguros Del Peru, a landmark ruling of the English Court of Appeal, to incorporate the principle of ‘close and intimate connection test’ in determining the seat of arbitration. Therefore, even in Gemini Bay the Indian Supreme Court should not have shied away from looking at the international practice and should have strived towards adopting a uniform interpretation of the law. Although the Indian Supreme Court was interpreting provisions of Part II of the Indian Arbitration Act, in effect they were engaged in an interpretive exercise of Article III (Binding nature of NYC award), Article IV (Conditions for application of enforcement of an NYC award) and Article V (Conditions for resisting enforcement of an NYC award) of the NYC. While interpreting an international instrument like the New York Convention, Articles 31 and 32 of the Vienna Convention on the Law of Treaties come into play. These articles require that a plain meaning should be accorded to the words of the treaty and the prevailing international practice must also be kept in mind. As evident from the array of the case laws derived from varying jurisdictions of both civil and common law tradition, the consistent global interpretation of NYC demands strict scrutiny of the foreign awards made against a non-signatory by the enforcing court. The Indian Supreme Court adopted an incorrect approach by failing to take into account this global practice and consistent interpretation of the NYC and interpreting the provisions of the Indian Arbitration Act in isolation. Excessive hardship for the non-signatories in resisting enforcement of foreign awards in India It is submitted that the decision in Gemini Bay serves a valuable purpose of highlighting the disadvantageous position that the Arbitration and Conciliation Act 1996 places the non-signatories during the stage of enforcement. The disadvantage is primarily in terms of: 1. While an award can be made against a non-signatory, grounds of resisting its enforcement in India under Section 48 are only available to the parties. According to the interpretation forwarded by the Supreme Court in Gemini Bay, a foreign award defined under Section 44 can be passed on the difference between “persons” which being a broader term includes not just the parties but also the non-signatories. Furthermore, the award is binding not just on the parties alone but on “persons” as per Section 46. Glaringly, however, while the Act recognizes the possibility of a foreign award being passed against a non-signatory, only a “party” can invoke the grounds under Section 48 to resist the enforcement of the award. Allowing an award debtor who is a party to take recourse to Section 48 and resist enforcement of the foreign award against him but disallowing the same opportunity to a non-signatory who also happens to be an award debtor is unreasonable and causes unnecessary prejudice to non-signatories. In Gemini Bay , the Supreme Court denied the arguments made by GBT, GBC and Mr. Upadhyaya inter alia on the ground that they were not parties and hence could not rely on Section 48. This raises an important question- what are the recourses the non-signatories have to resist enforcement of a foreign award against them in India if they have earlier been unsuccessful before the curial court? Unfortunately, after the Supreme Court’s interpretation of Section 48 in Gemini Bay, the non-signatories seem to have no recourse left to resist enforcement. This puts them in a severely disadvantaged position vis-a-vis parties to the arbitration agreement. In this regard, later in this article, it is submitted that there is an urgent need for amendment in the Indian Arbitration Act to account for the plight of the non-signatories. 2. Excess cost and burden on the non-signatories in moving the curial court The proponents of the approach adopted in Gemini Bay would argue that even though the non-signatory cannot rely on Section 48 to resist enforcement of the foreign award against it in India, the option to approach the curial court (i.e., the courts at the seat of the arbitration) is always available to the non-signatory from the time the award is passed. They can further argue that if the non-signatory does not agree to being made part of the arbitration proceedings, then the non-signatory should obtain an anti-suit injunction from the court of primary jurisdiction. The obvious conclusion to this line of argument is that if the non-signatory fails to get such relief from the court of primary jurisdiction, then the non-signatory must face the consequence of the enforcement of the foreign award against him in the secondary jurisdiction. Placing such a burden on a party who has not consented to participate in the arbitration proceedings is harsh, unnecessarily expensive and unjustified. A non-signatory who finds herself roped into an arbitration proceeding would be required to seek expensive legal representation to get it annulled before a foreign court. Further challenges can arise if the limitation period to appeal against the foreign award at the seat of arbitration has expired. By closing the opportunity of resisting enforcement at the court of secondary jurisdiction, the non-signatory is put in a tight spot and is virtually deprived of any substantial legal recourse. How can the non-signatories strategize in the light of Gemini Bay? The question which then arises is that similar to Gemini Bay,if a non-signatory finds herself under the scope of jurisdiction of an arbitral tribunal to which it did not consent to, what should be the best course of action? The first course of action would be a combination of moving the Courts at the seat of arbitration for setting aside the award and moving the courts in the enforcing states for resisting enforcement. The benefit of this approach is that it ensures that recourses to all legal forums are exhausted. However, this would require the client to seek legal advice in the jurisdiction of the seat of arbitration and other jurisdictions where the enforcement is likely to be sought which would substantially add to the expenditure of the client. The second course of action is to abstain from participating in the arbitration proceeding and challenge it before the enforcing court after the final award is passed. This approach has the advantage of making it clear that the party does not accede to the jurisdiction of the arbitral tribunal. However, the risk associated with this course of action is that the non-signatory might lose the valuable opportunity of resisting the joinder before the arbitral tribunal on merits. Participation in arbitration proceedings is advisable because it allows the non-signatories to adduce evidence and rebut allegations such as the application of the ‘alter ego’ doctrine in Gemini Bay. However, if the client is determined to not participate in the arbitral proceedings, it would be advisable to approach the Curial courts and seek either a declaration or an injunction against the arbitral tribunal's jurisdiction on the non-signatories. The third course of action for the non-signatory would be to challenge the finding of the arbitral tribunal that the non-signatory is a proper party to the arbitration proceeding through an appeal to the curial court. This strategy ensures that the non-signatory decisively battles it out in the curial courts and does not have to engage in a long drawn round of litigation in other jurisdictions where enforcement is sought. This strategy is further useful if the client is worried that the enforcing court in jurisdictions such as India might adopt a mechanistic approach in enforcing the foreign award and echo the findings of the arbitral tribunal without scrutinizing them. If it is likely that the award creditor will seek enforcement in a jurisdiction where the enforcing courts do not strictly scrutinize foreign awards against non-signatories, or in such jurisdictions where the rules and the laws surrounding enforcement of a foreign award against non-signatories is less developed, the client would be well advised to seek a definitive determination from the courts at the seat of the arbitration itself rather than taking the risk of resisting enforcement of the award in the courts of secondary jurisdictions. Conclusion The decision in Gemini Bay has highlighted the kafkaesque results that can emerge as a result of non-uniform drafting of provisions in Part II of the Arbitration and Conciliation Act 1996. While the foreign award under Section 44 can be made between ‘persons’ and it is ‘binding on all persons as between whom it is made’ under Section 45, the opportunity to resist enforcement of a foreign award under Section 48 is available only to the ‘parties’. There seems to be no intelligible rationale behind bringing non-signatories within the binding scope of a foreign award but not allowing them the opportunity to resist its enforcement. This calls for the creation of an adequate statutory framework to prevent undue prejudice to the interests of the non-signatories. It is submitted that ‘parties’ in Section 48 should be replaced with ‘persons’. This would be crucial in updating the Indian Arbitration Act’s focus from the traditional notion of involvement of ex facie parties towards the modern reality of increasing involvement of ‘non-obvious parties’ such as non-signatories and other third parties in international commerce and associated arbitration proceedings. However, this in itself will not be sufficient in providing adequate opportunity to the non-signatories to resist enforcement. The Courts will then have to interpret ‘the said agreement is not valid under the law to which the parties have subjected it or, failing any indication thereon, under the law of the country where the award was made” in Section 48(1)(a) in line with the global interpretation of the New York Convention to hold that it includes within its ambit the case where a non-signatory claims that the arbitration agreement is not binding on her because she was never a party to the arbitration agreement. Such interpretation would align the Indian position with the consistent global practice and at par with the interpretation forwarded in advanced arbitration jurisdictions such as England, Australia and Singapore. In conclusion, although Gemini Bay interprets the law correctly, it does not lead the Indian jurisprudence on the issue in the right direction. It is understandable that because in this case, the foreign award had been passed in 2010 but its enforcement was mired in rounds of litigation before the Indian Courts, the Indian Supreme Court placed emphasis on speedy enforcement. While the Indian Supreme Court strived to demonstrate a ‘pro-enforcement approach’, unfortunately, it cannot be achieved by adopting a mechanistic approach of giving approval to all foreign arbitral awards by reading Section 48 of the Indian Arbitration Act in isolation. Therefore, it is emphatically suggested that the Indian Courts in subsequent cases, should reassess the conceptual tussle between swift enforcement and upholding consent of the parties to be bound by arbitration proceedings and awards. [1] Harshvardhan Tripathi, Junior Editor ‘The Arbitration Workshop’, Class of 2022 NALSAR University of Law, Hyderabad. [2] For instance, see Arab Republic of Egypt v. Southern Pacific Properties Ltd. & Southern Pacific Properties (Middle East) Ltd. [3] Yearbook Comercial Arbitration XXVII (2002) p 519.

- Samarth Kapoor[1] and Pranshi Gaur[2] Abstract The act governing arbitration in India, i.e., Arbitration and Conciliation Act, 1996 (“Arbitration Act”) have gone through many much-needed amendments from time to time. Also, the judiciary has played a key role in interpreting the important provisions of the Act, be it the issue related to applicability of Part – I of the Act to foreign seated arbitration or the arbitrability of fraud claims, the judiciary has through its timely interventions guided the growing jurisprudence of arbitration in India. The one issue which is still a topic of debate is the determination of Seat and Venue in arbitration. The judiciary has tried to resolve the confusion and contradiction but there still appears room for uncertainty. This article will provide a comprehensive overview of the judgments on this issue and look into the difference between Seat and Venue with regards to the approach taken by the judiciary. Further, the article will delve deeper into the concept of the jurisdiction of the Courts concerning the Seat of arbitration, principles defined by courts to determine the Seat of arbitration and lastly will conclude in terms of the confusion created by different judgments and the way ahead to deal with this issue. Introduction The concepts of Seat and Venue under the regime of Indian arbitration law are different. There is no exclusive mention of “Seat” and “Venue” under the Arbitration Act however, both these terms are governed under the same provision of the Arbitration Act.[3] The concept of Seat and Venue in Arbitration is of utmost importance, where “Seat” defines the jurisdiction of the Court and laws applicable to the Arbitration proceedings and “Venue” defines the place, the location where the Arbitration proceedings are conducted.[4] The significance of the Seat of arbitration can be determined by referring to the provision of the Act, which distinguishes both the terms by referring to a Seat as a place of arbitration and a Venue as a place of meeting. The selection of a Seat will have some consequence as such selection of the Seat of arbitration will determine the supervisory jurisdiction of the court over the arbitral process, which means any issue pertaining to that arbitration proceedings will be taken care of by that court only. The Seat also determines what laws are applicable upon arbitral proceedings and which in turn will govern jurisdiction selected as the Seat, but this will be the case when the parties didn’t select the governing law while selecting the Seat of arbitration and therefore, the law of the Seat becomes the law governing the arbitration proceedings.[5] Seat and Venue: Distinguished The concept and context will not be clear if we go simply by reading the bare provision of the Act. The term Seat and Venue might be sound synonymous but the Supreme Court has demarcated the line between these two concepts. In the case of Bharat Aluminum Co. v. Kaiser Aluminum Technical Service Inc.[6] (“BALCO”), the Supreme Court observed that choosing the Seat of arbitration reflects the intentions of the parties to accept the law of that country relating to conduct and supervisory jurisdiction of the courts over the arbitration. Similarly, in the case of Enercon (India) Ltd. v. Enercon GmBH,[7] the Supreme Court expressed its view regarding the Seat and Venue and held that seat of arbitration is a crucial aspect and to be decided carefully as it decides the applicable law and arbitration procedure for deciding the disputes between the parties. Similarly, the Supreme Court in the case of Mankastu Impex Pvt. Ltd. v. Airvisual Ltd.[8], observed that, “The Seat of arbitration is a vital aspect of any arbitration proceedings. Significance of the Seat of arbitration is that it determines the applicable law when deciding the arbitration proceedings and arbitration procedure as well as judicial review over the arbitration award.” Hence, it is important to note that to reduce the confusion and contradiction while adjudicating the matter between the parties, the Seat should be selected with due caution and deliberation. Through the Seat of arbitration parties impliedly choose the curial or applicable law and arbitration procedure while the Venue of arbitration is merely a geographical location for conducting the meeting/ arbitration. Complicated position of Law with regards to Jurisdiction of Courts Considering the importance of these two terms in arbitration proceedings, the first judgment was the BALCO judgment, where the Supreme Court resolved the issue and confusion revolving around the concept of Seat and Venue. The Hon’ble Supreme Court in this judgment distinguished between the two terms and clarified that the term “place of arbitration” u/s 20 can be used interchangeably as a Seat under sub-section (1) and Venue under sub-section (3). Further while demarcating the line between the two crucial concepts, the Hon’ble Supreme Court held that when the Seat of arbitration is decided then that attains the permanent status and the Courts of such Seat will have the exclusive jurisdiction over the arbitration proceedings and the issues arising in connection with that Arbitration.[9] In an interesting turn of events the Supreme Court upheld the concept of party autonomy and held that the two courts have concurrent jurisdiction under the Act, i.e., the courts having the supervisory jurisdiction over the arbitration and the courts within whose jurisdiction the cause of action arises. The confusion created in the BALCO judgment was later stretched forward in some judgments of the High Courts and Supreme Court. In the case of Enercon (India), the Supreme Court held that, “Once the Seat of arbitration has been fixed in India, it would be in the nature of exclusive jurisdiction to exercise the supervisory powers over the arbitration” A similar instance was taken by the Supreme Court in the case of Reliance Industries Ltd. v. Union of India,[10] where the Supreme Court pressed the exclusive jurisdiction principle and deviated from the concept of concurrent jurisdiction as laid down in the BALCO judgment. On the similar lines of interpretation, the Supreme Court in the case of Indus Mobile Distribution Pvt. Ltd. v. Datawind Innovations Pvt. Ltd. (Indus Mobile),[11] analyzed the entire legal concept of Seat and Venue and held that only the courts within whose jurisdiction the Seat lies will have jurisdiction over the arbitration to exercise its powers and no other court will have the jurisdiction including the courts within whose jurisdiction the cause of action arose. In the case of Brahmani River Pellets Ltd. v. Kamachi Industries Ltd.,[12] the issue revolved around the dispute and difference between the concepts of “Seat” and “Venue”. The case has many folds where the Madras High Court assumed jurisdiction according to the arbitration clause in the agreement and held accordingly. However, in an appeal filed before the Supreme Court against the impugned judgment of Madras High Court. The Hon’ble Supreme Court reversing the judgment held that, “Where the contract specifies the jurisdiction of the court at a particular place, only such court will have the jurisdiction to deal with the matter and parties intended to exclude all other courts.” Similarly, in the case of Union of India v. Hardy Exploration and Production (India) Inc.,[13] the Supreme Court held that a Venue can be considered as a Seat of arbitration if the alone Venue is mentioned in the arbitration clause and some associated factors are added to it. However, the Court in the same case didn’t mention the preconditions according to which the place of arbitration can be considered as the seat of arbitration and that will be done on case to case basis. The same can be done by the holistic reading of the arbitral clause in light of the surrounding circumstances. Ultimately in Brahmani, the Supreme Court held that a Venue can be considered as a Seat until otherwise is mentioned in the Agreement. Unfortunately, the precedent settled, in this case, was not in line with the previous ruling of the Supreme Court on the same issue. Brahmani followed the exclusive jurisdiction principle but deviated from the ultimate conclusion.[14] The Supreme Court in the above-noted cases deferred from the “Concurrent Jurisdiction principle” evolved in the BALCO judgment and concluded the confusion according to the “Exclusive Jurisdiction principle” but High Courts did follow the same principle as set out in BALCO and as according to exclusive jurisdiction principle. The Delhi High Court in the Case of Antrix Corp. Ltd. v. Devas Multimedia Pvt. Ltd.,[15] applied the BALCO judgment and its interpretation concerning supervisory jurisdiction over the arbitration and held that even the courts where the cause of action arose will have the supervisory jurisdiction over the arbitration. Similarly, in the case of Konkola Copper Mines v. Stewarts and Lloyds of India Ltd.,[16] the Bombay High Court held that, “The judgment of the Supreme Court is declaratory of the position of law that the Court having jurisdiction over the place of arbitration can entertain a proceeding in the exercise of its supervisory jurisdiction as indeed the Court where the cause of action arises.” Also, in the case of Hinduja Leyland Finance Ltd. v. Debdas Routh,[17] the Calcutta High Court while interpreting the “Exclusive Jurisdiction” principle propounded in Indus Mobile and exclusive forum selection clause relied on BALCO judgment and Section 2(1)(e) which gave jurisdiction to two courts held that, “…nomination of a Seat does not oust the courts in other places where part of the cause of action has arisen, of their jurisdiction, as such a proposition would be contrary to the five-judge bench decision of the Supreme Court in BALCO. Hence, in choosing a Court under Section 2(1)(e)(i) we have now an additional forum, that is, the courts at the Seat of arbitration.” With regards to these judgments heavily relying on BALCO and terming Concurrent jurisdiction as the principle applying to govern the jurisdiction of the Courts. However, the Supreme Court in the case of BGS SGS SOMA JV v. NHPC Ltd. (BGS SOMA)[18] has relied upon the judgments of Indus Mobile, Reliance Industries, Enercon, and Brahmani River Pellets and held that the operative part of the BALCO judgment relied on Roger Shashoua v. Mukesh Sharma[19] should be read constructively which devised the exclusive jurisdiction principle. Also, the Supreme Court in the same case overruled the judgments of Antrix Corp. and Hardy Exploration and held these judgments and their interpretation as bad in law. Exclusive Jurisdiction of the Courts will also change with the change of place of Seat As already discussed above the concept of exclusive jurisdiction of Courts with regards to the Seat of Arbitration, the Supreme Court has categorically held that the Seat of Arbitration will be the determining factor for deciding the jurisdiction of the Court. But the question here arises is whether changing the Seat of arbitration will affect the jurisdiction of the courts? The Supreme Court in 2021 got the opportunity to settle this issue in the case of Inox Renewables v. Jayesh Electricals.[20] This issue of determining the jurisdiction of the Court with respect to the Seat of Arbitration has already been dealt with by the Supreme Court in BALCO and Indus Mobile by relying on the principle enshrined u/s 20 of the Act where the Supreme Court has held that irrespective of the fact that the part of the cause has arisen in the jurisdiction of some other court, it will not affect the jurisdiction of the Court where the Seat of the arbitration is placed. However, the present case has differed on grounds of facts as the Seat of the arbitration was mutually changed by the parties and the question proposed was “whether the change of the Seat of arbitration will also change the jurisdiction of the court?” The Hon’ble Supreme Court after relying on BGS SOMA and the judgment of Videocon Industries Ltd. v. Union of India[21] observed that the courts at the Seat of Arbitration specifically designated in the Arbitration Clause between the parties would have exclusive jurisdiction to resolve the disputes arising out of the arbitration and upheld the mutual agreement of changing the Seat of arbitration that too without writing.[22] The Supreme Court concluded and settled the proposition and held that in the case where the parties have mutually agreed to change the Seat of the arbitration the exclusive jurisdiction of the court will also shift and would accordingly vest with the Courts at the replaced Seat of Arbitration agreed by the parties. This judgment upheld the party autonomy which is the ultimate objective of the Arbitration Act. The Principles for Determining a Seat As stated above, the concept of Seat and Venue is governed by the same provision of the Act, while the Supreme Court has iterated its intention that the term “place” of arbitration can be used interchangeably as Seat and Venue of arbitration as per the intention reflected out of the arbitration clause of the agreement. The principle for determining a Seat for arbitration has been evolved through many cases and taking reference to foreign judgments.[23] However, the principles set out in different judgments found out to be contradictory in other judgments which fire up the confusion and controversy related to the concept. Shashoua Principle In the first instance, the Shashoua principle was discussed in the BALCO judgment where the Supreme Court relied on Roger Shashoua v. Mukesh Sharma and re-iterated the principle of determining the Seat of arbitration. The Shashoua principle states that if the parties have only clarified the Venue, combined with a supranational body of laws, and no other contrary provision available then that Venue can be considered as the Seat of arbitration. However, with regards to the jurisdiction of the courts, the Shashoua principle clarified that the courts having a Seat of arbitration will have exclusive jurisdiction with regards to any dispute that arose. The same Shashoua principle was re-iterated in the case of Enercon India, but in the agreement, there was a certain contrary provision available which fall under the garb of “contrary indicia” as set out in the Shashoua principle. Hence, according to this principle, a Venue can be considered as a Seat if it does not go against any of the provisions of the agreement. The “Closest Connection” Test When the arbitration clause lacks specificity with regards to the Seat of arbitration then courts turn down to check the intention of the parties through that agreement. In these cases, Courts apply the closest connection test to determine the Seat in cases where there is no intent is shown or specified in the agreement.[24] The Court of appeal in Sulamerica Cia National De Seguros S.A. v. Enesa Engenharia S.A.[25] suggests and pointed out a three-stage enquiry to cull out the Seat of arbitration, first is the express choice, second is the implied choice, and third is by applying the closest and most real connection test. Same in the case of C v. D,[26] where the Court of appeal states that, “…an arbitration agreement will have the closest connection with the place where parties have chosen to arbitrate than with the place of the underlying contract, in cases where the parties have deliberately chosen to arbitrate, in one place, disputes which have arisen under a contract governed by the law of another place.” Recently the UK Supreme Court in the case of Enka Insaat v. OOO “Insurance Company Chubb”[27] tried to simplify the Sulamerica ruling wherein the UKSC observed that in absence of any express choice of governing law, the general rule will be to consider the law governing the underlying contract. However, the SC was of the view that the choice of a different country as the seat of arbitration cannot be ignored which was considered/ intended to apply to the arbitration agreement. Even the closest connection test is established, the law of the Seat (intention of the parties) will be preferred to govern the arbitration agreement. In the Indian context the Supreme Court the case of Enercon (India) Ltd. v. Enercon GmBH discussed the cases of Sulamerica and C v. D and by ultimately relying on the principle set out in Naviera Amazonica Peruana S.A. v. Compania Internacional De Seguros Del Peru[28] held that since the parties have not decided the Seat of arbitration hence court should apply closest and most real connection to determine the Seat. The principle laid down in Hardy Exploration and deviation from Shashoua principle. Supreme Court earlier clarified there is no confusion with regards to the concept of Seat and Venue of arbitration as they can be used interchangeably as per the intent shown in the agreement. The Supreme Court in Hardy Exploration, went on to clarify the doubt regarding the consideration of Venue as a Seat of arbitration. Supreme Court relied on the UNCITRAL Model law to determine the Seat of arbitration in the case where parties have agreed for the Venue but not for the Seat and held that the courts should look for other factors that can be included to determine the Seat of arbitration and for that purpose the arbitration agreement should be read holistically. Supreme Court clarified that Venue cannot be considered as a Seat until some other factors have been adduced to it and some condition precedent is satisfied. The reasoning and principle in hardy exploration are considered to be a deviation from the Shashoua principle as it sets out some more considerable factors to lead the confusion while selecting a Seat of arbitration. The principle set out in BGS SOMA After the setback in Hardy Exploration judgment which deviates from the Shashoua principle, Supreme Court was faced with the same question that whether the Venue or place can be considered as the juridical Seat of arbitration. The Hon’ble Supreme Court in the case of BGS SGS SOMA JV v. NHPC Ltd., while dealing with the same question held that a place of arbitration regardless of its designation as Seat or Venue can be considered as juridical Seat of arbitration until something contrary is specified in the agreement by the parties. The judgment went ahead to reaffirm the Shashoua principle and record that “contrary indicia” shown in the agreement is the only factor to determine whether a Venue can be considered as a Seat or not. The Supreme Court through this judgment overruled the interpretation given by the Courts in Hardy Exploration and Antrix judgment and held these judgments as contrary to BALCO judgment and bad in law. Mankastu Impex Principle In the recent development regarding the issue about Seat and Venue, Supreme Court got the opportunity to decide and revisit the issue in the case of Mankastu Impex Pvt. Ltd. v. Airvisual Ltd. and held that, “It has also been established that mere expression “place of arbitration” cannot be the basis to determine the intention of the parties that they have intended that place as the “Seat” of arbitration. The intention of the parties as to the “Seat” should be determined from other clauses in the agreement and the conduct of the parties.” “…..The agreement between the parties that the dispute “shall be referred to and finally resolved by arbitration administered in Hong Kong” clearly suggests that the parties have agreed that the arbitration is seated at Hong Kong and that laws of Hong Kong shall govern the arbitration proceedings as well as have the power of judicial review over the arbitration award.” The finding in Mankastu seems contrary to that of BALCO and Shashoua principles as it deviates from the territoriality principle to determine the seat of arbitration. Also, Mankastu concluded that Seat and Venue u/s 20 cannot be used interchangeably. If the court would have considered the test laid down in Hardy Exploration and BGS SOMA JV, the result would be the same, i.e., Hong Kong to be the juridical Seat of arbitration. However, the view taken by the Supreme Court with regards to the place and Venue of arbitration seems to have confused the concepts and in the end deferred from that of BALCO.[29] Concluding Remarks and the Way Ahead The Seat of arbitration may well be quite independent of the Venue where the proceedings of arbitration or other parts of the arbitral process take place. The Seat of arbitration is vital, as it will decide the applicable law and procedure for conducting the arbitration process. Also, the courts having the Seat in their jurisdiction will have supervisory jurisdiction over the arbitral process. Identification of the Seat of arbitration post BALCO judgment has become one of the most important features of an arbitration clause. The selection of the Seat determines the law governing the Arbitration procedure and often, more importantly, the process and rights relating to the enforcement of the arbitration award. In an attempt to make the wording of the Act consistent with the international usage of the concept of a “Seat” of arbitration, and for that purpose the 246th Law Commission Report[30] inter alia proposed an amendment to Section 20(1) of the Act. In its recommendation, the law commission focuses on substitution of the word “place” with “Seat and Venue” in Section 20. However, the suggestion was not implemented and did not see the light of the day. In this context, the Court in Indus Mobile Distribution Pvt. Ltd. v. Datawind Innovations Pvt. Ltd. & Ors., succinctly observed that “… the BALCO judgment in no uncertain terms has referred to ‘place’ as ‘juridical Seat’ for the purpose of Section 2(2)[31]of the Act. It further made it clear that Section 20(1) and 20(2) where the word ‘place’ is used, refers to ‘juridical Seat’, whereas, in Section 20(3), the word ‘place’ is equivalent to ‘Venue’. This being the settled law, it was found unnecessary to expressly incorporate what the Constitution Bench of the Supreme Court has already done by way of construction of the Act.” As in the judgments stated above, the Supreme Court tried to resolve the confusion revolving around the concept of Seat and Venue by demarcating a line between them but in doing so in some of the judgments the concept of party autonomy has been given a go by. However, the Supreme Court has given the much-needed clarity on the aspect of Seat, Venue, place, and jurisdiction of courts. The link that was missing between the Seat, Venue, and place of arbitration was founded in BALCO and other judgments delivered by the Supreme Court. However, the different stance taken by different constitutional courts has added more confusion to the concepts. While one of the reasons for the problem and contradiction is poor drafting of arbitration clauses in the agreement, the lack of an express provision in the Act cannot be overlooked. Hope the recent judgment of Mankatsu will serve the purpose as of now and the recent ruling of the Supreme Court in Inox Renewables will be considered as a set-out principle until a new confusion is raised in this conundrum. [1] Samarth is a 4th year student at Maharashtra National Law University Aurangabad. [2] Pranshi is a 4th year student at Maharashtra National Law University Aurangabad. [3] The Arbitration and Conciliation Act, 1996, No. 26 of 1996, Acts of Parliament, 1996, §20. [4] Prerona Banerjee and Rajvansh Singh, Indian Supreme Court revisits the distinction between Seat and Venue of arbitration, Young ICCA Blog, (August 29, 2021, 7:20 PM), https://youngicca-blog.com/indian-supreme-court-revisits-the-distinction-between-seat-and-venue-of-arbitration/. [5] Hiroo Advani and Others, Seat v. Venue in Contemporary Arbitral Jurisprudence, The SCC Online Blog, (September 2, 2021, 8:14 PM), https://www.scconline.com/blog/post/2021/05/06/seat-v-venue-in-contemporary-arbitral-jurisprudence/. [6] Bharat Aluminium Co. v. Kaiser Aluminium Technical Service Inc., (2012) 9 SCC 552. [7] Enercon (India) Ltd v. Enercon GmbH, (2014) 5 SCC 1. [8] Mankastu Impex Pvt. Ltd. v. Airvisual Ltd., 2020 (3) Arb LR 63 (SC). [9] Anjali Anchayil and Ashutosh Kumar, Choice of Seat or Venue: Supreme Court of India Dithers, Kluwer Arbitration Blog, (August 30, 2021, 02:30 AM), http://arbitrationblog.kluwerarbitration.com/2020/05/13/choice-of-seat-or-venue-supreme-court-of-india-dithers/. [10] Reliance Industries Ltd v. Union of India, (2014) 7 SCC 603. [11] Indus Mobile Distribution Private Limited v. Datawind Innovations Private Limited, (2017) 7 SCC 678. [12] Brahmani River Pellets Ltd v. Kamachi Industries Ltd., AIR 2019 SC 3658. [13] Union of India v. Hardy Exploration and Production (India) Inc., AIR 2018 SC 4871. [14] Daksh Trivedi, Abhijnan Jha and Sourya Donkada, Brahmani River Pellets Judgment: Reigning The Seat vs. Venue Debate, Mondaq (September 4, 2021, 12:50 AM), https://www.mondaq.com/india/arbitration-dispute-resolution/852332/brahmani-river-pellets-judgment-reigniting-the-seat-vs-venue-debate?type=mondaqai&score=85. [15] Antrix Corp. Ltd. v. Devas Multimedia Pvt. Ltd., 2018 SCC Online Del. 9338. [16] Konkola Copper Mines v. Stewarts and Lloyds of India Ltd., 2013 (3) Arb LR 329 (Bom.). [17] Hinduja Leyland Finance Ltd. v. Debdas Routh, 2018 (1) CHN (CAL) 561. [18] BGS SGS SOMA JV v. NHPC Ltd., 2019 (6) Arb LR 393 (SC). [19] Roger Shashoua v. Mukesh Sharma, [2009] EWHC 957 (Comm). [20] Inox Renewables v. Jayesh Electricals, 2021 SCC OnLine SC 448. [21] Videocon Industries Ltd. v. Union of India, (2011) 6 SCC 161. [22] Nishant Menon and Niharica Khanna, Change of Seat of Arbitration By Mutual Agreement, (August 29, 2021, 12:05 PM), https://www.mondaq.com/india/arbitration-dispute-resolution/1086852/change-of-seat-of-arbitration-by-mutual-agreement. [23] Roopadaksha Basu, The Seat v/s. Venue Debate – A continuing Saga, Mondaq (September 5, 2021, 01:30 AM), https://www.mondaq.com/india/arbitration-dispute-resolution/957918/the-seat-vsvenue-debate-a-continuing-saga. [24] Payal Chawla, Seat of Arbitration and its communion to lex – larger bench to decide: Part I, II & III, Bar & Bench, (August 31, 2021, 8:00 PM), https://www.barandbench.com/columns/seat-arbitration-communion-to-lex-larger-bench-part-i. [25] Sulamerica Cia National De Seguros S.A. v. Enesa Engenharia S.A., [2013] 1 WLR 102. [26] C v. D, [2007 EWCA Civ 1282 (CA)]. [27] Enka Insaat Ve Sanayi AS v. OOO “Insurance Company Chubb”, [2020] UKSC 38 (Enka). [28] Naviera Amazonica Peruana S.A. v. Compania Internacional De Seguros Del Peru, 1988 (1) lloyd’s Rep 116. [29] Rishabh Dheer, Mankastu Impex Private Limited v. Airvisual Limited: The Juridical Seat Place-d in Muddier Waters, The Arbitration Workshop, (August 30, 2021, 12:50 PM), https://www.thearbitrationworkshop.com/post/mankastu-impex-private-limited-v-airvisual-limited-the-juridical-seat-place-d-in-muddier-waters. [30] Law Commission of India, 246th Report on Amendments to the Arbitration and Conciliation Act, 1996, 52 (August, 2014), available at: https://lawcommissionofindia.nic.in/reports/Report246.pdf. [31] The Arbitration and Conciliation Act, 1996, No. 26 of 1996, Acts of Parliament, 1996, §2(2).

*Abhay Raj & Ajay Raj Keywords: Section 9, Section 11, Section 4 Party autonomy is an intrinsic facet of arbitration that enables parties to opt for the seat of arbitration.[1] Resultantly, the courts at the seat have exclusive supervisory jurisdiction over the dispute. This is evident from the Supreme Court’s decision in Indus Mobile Distribution Pvt. Ltd. v. Datawind Innovations Pvt. Ltd. and Ors., wherein it was observed that parties’ designation of a seat of arbitration is akin to agreeing upon an exclusive jurisdiction clause. Herein, the term ‘exclusive’ signifies that one or more parties are obliged to only resort to the stated jurisdiction for disputes falling within the agreement. Despite including an express clause on exclusive jurisdiction/seat of arbitration, at times, parties tend to deviate from the selected jurisdiction and initiate proceedings before a different court altogether. As such, a deviation can occur when the party, for a Section 9 application or for challenging an award obtained, initiates the said proceedings in a court which is different from the one mentioned in the exclusive jurisdiction clause. Prima facie, this is untenable owing to the inclusion of an exclusive jurisdiction clause, which as the word suggests, ousts the jurisdiction of all other courts. In other words, a party should ideally not, per that party’s whims, opt for a jurisdiction where they believe that the adjudication would be convenient. For the purpose of analysing the said scenario, the following legal issues ought to be assessed: i. Whether the parties’ failure to assert an exclusive jurisdiction clause amounts to a waiver of the clause and acceptance of that court’s jurisdiction; and ii. Whether making an application under Section 9 of the Arbitration and Conciliation Act 1996 (“Arbitration Act”) before court A would bar the jurisdiction of any or all other courts to entertain a Section 11 application arising out of the same arbitration agreement. In this post, the author attempts to address both these issues. In order to do so, this piece first analyses how exclusive jurisdiction clauses have been perceived by the Indian courts over time, and assuming that a party initiates proceedings by ousting the exclusive jurisdiction clause and no objection is raised by the other party, whether that clause is waived off by the other party. The answer to it is ‘yes’. Thereafter, the authors specifically assess the jurisprudence vis-à-vis Section 9 and Section 11 of the Arbitration Act in order to identify whether these two applications—one pertaining to interim relief and the other to the appointment of arbitrator—in two different courts, disregard the exclusive jurisdiction clause. As will be demonstrated, the answer is not clear and warrants further scrutiny. To strengthen the regime, the authors propose certain amendments, thereby concluding the piece. Exclusive jurisdiction clause and objection to another court’s jurisdiction Section 4 of the Arbitration Act expressly provides that if a party is aware that the arbitration agreement has not been complied with and yet, it does not object to such non-compliance without undue delay, such would be deemed to have waived its right to object to such non-compliance. The effect of a party’s failure to object to a seat or venue of arbitration was discussed in the decision of Quippo Construction Equipment v. Janardhan Nirman, wherein the Court held that if an objection is not raised during the arbitral proceedings, a subsequent objection would be barred. Based on Section 4, the Delhi High Court observed in AAA Landmark Pvt. Ltd. v. AKME Projects Ltd.& Ors., that where the parties agree to not insist upon the exclusive jurisdiction clause in an agreement or raise such objection, it amounts to waiver by the conduct of such condition. Thus, if the parties to an arbitration agreement neglect the exclusive jurisdiction clause contained therein by not objecting to the jurisdiction of another court, the parties will be deemed to have waived their right to object. Separately, pursuant to Section 21 of the Code of Civil Procedure 1908 (“CPC”), no objection in respect of the “place of suing” can be allowed unless it was taken in the court of the first instance. This settles that a party may waive objections to the jurisdiction of a court by conduct. Taking a cue from this principle, the Supreme Court in Harshad Chiman Lal Modi v. DLF Universal Ltd., laid down that lack of territorial jurisdiction is a mere irregularity which may be remedied by the parties by a waiver of any objections thereto, but the lack of subject matter jurisdiction would ipso facto make the proceedings a nullity. In Seth Hiralal Patni v. Sri Kali Nath,[2] the petitioner had filed a suit in the Bombay High Court for recovery of certain monies. The dispute was referred to arbitration. In execution proceedings, the respondent contended that the Bombay High Court had no jurisdiction as the cause of action did not arise in Mumbai. The court held that the respondent’s failure to object to the Bombay High Court’s jurisdiction amounted to its waiver of any right to objection at a later stage. Therefore, it is amply clear, that apart from subject matter jurisdiction, an objection to the territorial jurisdiction of the court, can be made only before the court of the first instance. Very recently, the United Arab Emirates (UAE) also enacted the ‘UAE Arbitration Law’ based on the Model Law. Under Article 25 of the UAE Arbitration Law, it has been provided that “a party’s failure to make objections to jurisdiction within the prescribed date is evidence of the party’s consent to the counterparty’s actions.” Thus, taking a cue from the UAE in addition, the author submits that an objection to the jurisdiction of the court can be only made before the court of the first instance and otherwise, the parties would be deemed to have waived their right to object. Thus, while exclusive jurisdiction is regarded as paramount and ought to be necessarily adhered to by parties, the conduct of acquiescence from either party’s end would deem to effectuate a waiver of the said exclusive jurisdiction clause. The conundrum surrounding Section 9 vs Section 11 It is conspicuous that parties are vested with the competence to opt for an exclusive jurisdiction clause, which is regarded paramount while deciding jurisdiction. This brings us to analyse whether it is imperative to initiate proceedings/ relief under Section 9 and Section 11 of the Arbitration Act in the same ‘court’ as similar to the exclusive jurisdiction clause and whether that clause or for that matter any other court in case the exclusive jurisdiction clause has been waived, requires parties to file the applications in the same court. In AAA Landmark Pvt. Ltd. v. AKME Projects Ltd.& Ors., a similar question arose where the court held that only the authority which has been conferred the exclusive jurisdiction would have the jurisdiction to entertain an application under Section 11 of the Arbitration Act. This would not be barred by an application under Section 9 of the Arbitration Act in another court. However, still, a question has been raised about whether a Section 11 application is one preferred before a “court”. Ex-facie, the designation of ‘seat’ is analogous to an exclusive jurisdiction clause and ousts the jurisdiction of all other courts. However, interestingly, in the case of Brahmani River Pellets Ltd. v. Kamachi Industries Ltd., the court has held that only the court exercising jurisdiction over the ‘venue’ of arbitration can appoint an arbitrator under Section 11(6) of the Arbitration Act. Thus, it can be construed that notwithstanding Section 20 of the CPC, the parties’ consent to decide on a place of arbitration would oust the jurisdiction of all other courts. For understanding whether the position adopted is in conformation to the arbitration jurisprudence in India, it is imperative to analyse it in light of the statutory provisions. Section 42 of the Arbitration Act expressly provides that where an application has been made under Part I of the Arbitration Act in any court, only that court would have jurisdiction over the arbitral proceedings and all subsequent applications arising out of that agreement and the arbitral proceedings. The provision is preceded by a non-obstante clause that gives priority to the section over other provisions of Part I and any other laws in force. “Court” is defined under Section 2(1)(e) of the Arbitration Act to mean “a civil court of original jurisdiction in a district or a High Court having ordinary original civil jurisdiction to decide the questions forming the subject-matter of the suit” in case of domestic arbitration. Under Section 11, an application is to be preferred before the Chief Justice of the court. As per a literal interpretation of this, an application under Section 11 would not fall within the purview of Section 42. This approach was followed in State of West Bengal v. Associate Contractor, where the court held “Section 42 would not apply to applications made before the Chief Justice or his delegate for the simple reason that the Chief Justice or his delegate is not “court” as defined by Section 2(1)(e).” The same view was taken in Pandey & Co. Builders (P) Ltd. v. State of Bihar & Another. The 176th and 238th Law Commission Reports suggested a change in this approach and the section was amended in 2015 to replace “Chief Justice” with “the Supreme Court” or the “High Court” or the “institution designated by such court”. Thus, an application under Section 11 would also have been an application to the court. However, the section was further amended by the Arbitration and Conciliation (Amendment) Act, 2019 to provide that the appointment would be made by the arbitral institution designated by the Supreme Court in case of international commercial arbitration or by the High Court in case of other arbitrations. This further raises concerns as an institution appointed by the court is not a court. Section 11(6B) of the Arbitration Act expressly provides that the designation of any institution by the court shall not be regarded as a delegation of judicial power. Hence, now if an application for appointment of arbitrators is made under Section 11, it should not attract Section 42. A conjoint reading of these provisions and precedents provide that a Section 9 application before court A would not require a Section 11 application to be in the same court. It is noteworthy that the stated position seems to have been affected by the Brahmani Pellets case. But, at the same time, it is also imperative to note that in Brahmani Pellets case, the Supreme Court did not determine the ‘seat’ of the arbitration and placed reliance only on the ‘venue’ of the arbitration. Moreover, it failed to appreciate the precedents such as Indus v. Datawind. This is, thus, an aspect that certainly needs to be considered in the context of the issue at hand as Section 11 is not essentially in coincidence with Section 42 of the Act, whereas the Section 9 is. Concluding remarks In view of the aforesaid analysis, it can be deduced that an exclusive jurisdiction clause ousts the jurisdiction of all other courts. However, in case the parties seek to assert an exclusive jurisdiction clause, such assertion must be made in a timely manner. As seen, Indian courts are unlikely to allow parties to raise a challenge based on jurisdiction if they fail to object at the first instance. An exclusive jurisdiction clause cannot, therefore, be used as a tool for disruption and delay if it is not asserted at the earliest by the objecting party. Such an approach would help in achieving the speedy resolution of the dispute and would further assist in escalating the ethical obligation on the parties, i.e., to always act in good faith. Moreover, the jurisprudence post the Section 11 amendment, in particular, seems to be blemished. In order to strengthen the regime, the author recommends the following- Firstly, taking the cue from UAE, Section 4 of the Arbitration Act should be amended to specifically include within its ambit automatic waiver of objection to the jurisdiction of a court where such objection is not taken without undue delay. Secondly, ex facie, Section 42 of the Act does not include the amended Section 11 of the Arbitration Act. However, in the context of future amendments to the Arbitration Act, an attempt must be made to determine if Section 42 of the Arbitration Act needs to be amended to include Section 11 applications within its ambit and restrict the scope of forum shopping. *Abhay Raj is a 3rd Year Student of Jindal Global Law School (a constituent of O.P. Jindal Global University) and Ajay Raj is a 4th Year Student of Symbiosis Law School, Pune, India. [1] Robert Merkin and Louis Flannery, Arbitration Act 1996 (5th edn, Informa Law from Routledge 2014) 234 [2] Seth Harilal Patni v Sri Kali Nath [1961] 1962 SCR (2) 747

-Pratik Raj & Prasidhi Agrawal[1] I. INTRODUCTION Arbitration is opted as a suitable adjudication process because of its intrinsic quality of being confidential. Arbitration is informally considered to be confidential because unlike traditional courts, where information related to proceedings is easily accessible to a lot of people, in case of arbitration, subject to certain conditions, only the adjudicator and the parties are allowerd to be present during the proceedings which happens in a closed room, therefore, arbitration is rather a private affair. Therefore, given safeguarding the company's reputation and avoiding the inconvenience that may result from disclosure of trade secrets and other sensitive information, arbitration is a suitable choice. However, until very recently, active confidentiality provision was not a part of a statutory framework for arbitration. Confidentiality provision was introduced as Section 42-A by way of Arbitration and Conciliation (Amendment) Act, 2019 to the Arbitration and Conciliation Act, 1996 (‘the Act’). It is imperative to understand that confidentiality exists in a very restricted atmosphere because it imposes the obligation of maintain confidentiality on a very few people and the Section also encompasses just one exception, which has been highlighted later in this research work. Therefore, the provision is certainly not comprehensive. Section 42-A imposes a duty upon arbitrator(s), parties to the dispute, and counsels representing the parties to not disclose any information concerning the arbitration proceedings. The only exception which has been accounted for, is the disclosure of arbitral awards in order to facilitate its implementation. Consequently, in more than one instance, this provision can come into direct conflict with other provisions of the act and the nature of Section 42-A being non-obstante, other provisions of the act will have to be undermined. At this point, a pertinent question that arises is that what will be the case when the Act itself provides for the interference of any other person other than the parties to the dispute, their respective counsels and arbitrator(s), in arbitration proceedings? This question can be raised with respect to the problems that will be faced in the application of Section 26 of the Act that deals with the involvement of an expert in arbitration proceeding. This provision provides a legal framework for the systematic interference of such other people in arbitration proceedings as held by the apex court in the case of Ramesh Chandra Agrawal v. Regency Hospital Ltd.[2] However, a problem associated with the implementation of this provision is that confidentiality provisions will have to be breached to effectuate these provisions. This is because the involvement of such other persons in arbitration proceedings would mean disclosing information related to the arbitration proceedings with these people. This research work specifically aims at (i) The analysis of Section 26 of the act (ii) Its effect on the newly introduced confidentiality clause,and (iii) An attempt has also been made in order to formulate suitable solutions for overcoming this problem. II. SECTION 26: AN OVERVIEW Section 26 of the Act facilitates the appointment of a neutral party as an expert in order to assist the arbitral tribunal on a technical point and it has also been substantiated in the case of Ramnathan v. State of Tamil Nadu.[3] This is also in compliance with Section 45 of Indian Evidence Act, 1872 which states that those facts which are otherwise not relevant become relevant when expressed by an expert.[4] Section 26(1)(b) states that the parties are required to furnish any relevant information or provide access to any documents, accounts, etc. to the expert, for the purpose of inspection. Further, Section 26(2) states that such an expert can also participate in oral hearings of the arbitration proceedings if the need arises. There is nothing inherently wrong with these provisions as it is both, developed on lines of UNCITRAL Model Law and also in consonance with Section 45 of Indian Evidence Act, 1872. Further, these provisions do not undermine the authority of arbitral tribunal or the stand of complete arbitration proceeding because the opinion of an expert is not binding in nature, as highlighted by the Supreme Court in a plethora of judgments which include Fakhruddin v. State of Madhya Pradesh, Sultan Singh v. State of Haryana, Ramesh Chandra Agarwal v. Regency Hospital Ltd. among many others.[5] It is advisory in nature and completely depends on the will of the arbitral tribunal to accept it or to reject it. Therefore, the role of an expert is limited to only technical assistance and not the delivery of judgment. Further, the act is only concerned with the relevance of the expert's opinion as evidence and not its substance or merit which has also been the opinion of the Supreme Court in the case of Murari Lal v. State of Uttar Pradesh.[6] There is no requirement of corroboration in case of expert evidence. Therefore, the arbitral tribunal can conveniently seek the help of an expert without having its authority challenged, as also laid down in the landmark judgment of Vishnu v. State of Maharashtra.[7] However, the primary issue is regarding the coexistence of Section 26 with the confidentiality clause in a mutually inclusive environment. III. THE BONE OF CONTENTION Arbitration is a more suitable choice for technical disputes. Technical disputes, such as those that require knowledge about a specific field or those disputes that require deep assessment of accounts, are not preferred for being adjudged by traditional court setups. This is because it requires long hours of discussion and getting into extensive details, which cannot be afforded by the courtsas they are already overburdened with a large number of pending suits. Here arbitration becomes a suitable option for such issues because it makes the adjudication a private affair,[8] and is not as burdened as traditional court setup.It has expressed provisions for the appointment of an expert to discuss a technical matter,[9] and has the authority to make awards that can be implemented as decrees of courts.[10] Accordingly, Courts and Arbitral Tribunals have often opted for the opinion of an expert in cases where specific technical knowledge is required, which is not usually possessed by the courts (as has been the established precedent ever since the judgment in Folokes v. Chadal).[11] For instance, a dispute between companies which requires a proper assessment of accounts of the companies by a competent person where the arbitral tribunal cannot fit into the shoes of such a "competent person". Clause (2) of Section 42-A enables such an expert to attend the oral hearings where the parties can put questions to the expert with respect to his technical advice. A direct implication of this provision is that the parties would be required to disclose important information to the expert. Some information like trade secrets, intellectual property, etc. would naturally be disclosed if the expert is allowed to be present in the oral hearings of the dispute. This provision is in direct conflict with the confidentiality clause as provided for in Section 42-A of the Act. Ultimately hindering the application of confidentiality provision and one of the very fundamental purposes of Alternative Dispute Resolution mechanism for which it is often opted for. This is because- parties tend to avoid adjudication through a traditional court setup. After all, arbitration provides a more cost and time-effective mechanism. Further, in the case of arbitration, accessibility is allowed to a very limited number of people and thus, maintaining the confidentiality of the proceeding. As a result, parties are not required to disclose any sensitive information like trade secrets, books of account, contracts, etc. This not only enables the parties to prevent Intellectual Property Rights’ infringement but also enables the parties to maintain the reputation of their company in the eyes of the public. However, Section 26(1)(b) of the Act specifically grants power to the arbitral tribunal to order the party to give the expert any relevant information or to produce, or provide access to any relevant information, or goods or other property for inspection by the expert. Therefore, this leads to a conflict between Sections 42-A and 26 of the Act. On the face of it, the solution to this problem is quite simple. Section 42-A invokes a non-obstante clause and therefore it will have an overriding effect, in case, it comes into conflict with other provisions of the same act or any other act(s). Therefore, there is a requirement of proper assessment in order to determine which provision should enjoy an upper hand because once the importance of both Sections 42-A and 26 have been highlighted, one can understand that neither of them can be given less importance. IV. SUGGESTIONS For the uncertainty surrounding the appointment of experts and the scope of the confidentiality in the arbitration proceedings, the situations demand a comprehensive and straightforward measure that needs to be adopted in order to avoid the risk of fragmentation of the backbone of arbitration proceedings. 1. Undertaking for Non-Disclosure One of the measures to deal with the conflict can be that the experts must be directed to sign a confidentiality undertaking and declare expressly that they wouldn't disclose any information, documents, and files concerning the arbitration proceeding to an outsider, in order to uphold the confidentiality of the proceeding. Otherwise, such person/s would be charged with penal consequences like fines and imprisonment in accordance with specifically instituted law, which is expected be the international practice, as also laid down in Guyana v. Suriname.[12] This way it can be ensured that Sections 42-A and 26 can co-exist in a mutually inclusive environment. This model has already been successfully incorporated in 2021 Arbitration Rules of International Chamber of Commerce in the form of Article 1(6) of the Appendix. However, a preliminary question that may arise in the present instance is that what will be the course of action when the undertaking or any of its laid terms as signed and agreed upon by the expert is breached? The answer to this can only be given when a substantial change is brought in the legal system by introducing certain comprehensive new rules of arbitration expressly providing for a judicial recourse ensuring strict penal action against any such offender who misuses his position. This will not only ensure that the concerned expert is well within their boundaries but would also ensure no risk to the parties and best exhibit the party-friendly and proactive attitude of the legal system in supporting this backbone of arbitration. 2. Amendment of Section 42-A An alternative to undertaking for confidentiality would be an amendment to Section 42-A of the Act. The Section 42-A in its present form imposes an obligation upon the arbitrator(s), parties to the dispute, and their counsels to not disclose any information to outsiders (in consonance with the arbitration proceeding). However, if this obligation of non-disclosure can be extended to any other party which in the course of the arbitration proceeding, became a part of it, then it can be ensured without the aid of any additional provision, that experts appointed under Section 26 do not become the source for breach of confidentiality. This would also be a replication of 2021 Arbitration Rules of ICC, the Article 1 of Appendix II of which expresses the provision that any person who receives any information regarding arbitration proceeding has a legal obligation to keep it confidential and not publish it. Article 1 also mandates seeking permission of Secretary General of Arbitral Tribunal before handing over any document or information to an outsider. Since if the same is incorporated in the Indian Act, it would be a replication of International Model, and thus, would have more authority. This is a more concrete and less frivolous solution as compared to other solutions because it will not require the signing of the undertaking, which essentially is a contract in form of a Confidentiality Undertaking or a Non-Disclosure Agreement. The legality of such agreements is determined by provisions of the Indian Contract Act, 1872. However, owing to the nature of Non-Disclosure Agreements, there cannot be general forms of contract to effectuate these agreements. It requires separate agreements for different purposes, with different terms of agreements. Not only this process will be more cumbersome, but invoking sanctions will also become subject to the terms of the agreement. 3. Taking Inspiration from International Model Law Article 34.5 of UNCITRAL Model Law on International Commercial Arbitration has an indirect provision for confidentiality. The Article states that arbitral awards can be made public by consent of both the parties to the dispute. However, this provision is also not comprehensive in dealing with the issue of confidentiality and it merely states that an award can be made public subject to the consent of parties to the dispute. The model law places reliance on a plethora of international judgments, discarding the need for active provisions for confidentiality. This includes the Australian High Court’s judgment (Esso & Ors. v. Plowmann) that confidentiality is not an essential attribute of arbitration.[13] It also includes the United States' judgment (U.S. v. Panhandle et. Al) that there cannot be a uniform law for confidentiality in arbitration.[14] United Kingdom also does not have absolute provision for confidentiality which has been similarly held in a plethora of judgments, including Ali Shipping Corp. v. Shipyard Troggir and Emmott v. Michael Wilson & Partners Ltd[15] and the stand is similar in Singapore as well by virtue of judgment in the case of Yaung Chi Oo Co. Ltd. v. Win Win Nu.[16] Therefore, there is a general worldwide acceptance of the fact that there cannot be uniform objective rules for confidentiality in arbitration proceedings, because of the sheer amount of implications that may result from it. Further there are other provisions as well which states appointment of experts for technical assistance in arbitration. This includes Article 27 of UNICTRAL Arbitration Rules, 2010, which only gives evidentiary value to expert witness. Further, Article 39 of the 2015 SHIAC Arbitration Rules also provides opportunity to arbitral tribunal to appoint an expert at its own discretion. Appointment of expert for witness is also warranted by 2021 ICC Arbitration Rules by virtue of its Section 25(2). All these provisions coexist with confidentiality clause in a mutually inclusive environment and their applicability can be assessed in order to develop a tailor-fit provision for the Indian arbitration regime where confidentiality and expert witness can peacefully coexist. Co-relating the Indian law with various international model laws, a conclusion can be drawn that the Indian law is loosely based on various international provisions and more specifically is an embodiment of Article 26 of UNCITRAL Model. Even though this is not a very concrete solution and mostly suggestive in nature, nonetheless, the conceptualization of domestic framework on lines of international model law can ensure better applicability of the provisions. This can be used for the realization of the importance of provisions for the appointment of expert and how it cannot be undermined for the facilitation of a superfluous provision of confidentiality. 4. Redaction of Confidential Information This is again not a very concrete solution however in many cases; it can be relied upon to ensure that Sections 42-A and 26 can peacefully coexist. If an expert is allowed only access to some information, which is necessary in order to obtain his technical assistance the question that arises is regarding the accuracy of the redaction as against the original document. ICC’s 2021 Arbitration Rules’ Article 1(6) of Appendix II provides for a similar arrangement wherein any information provided to an outsider is required to be returned or destroyed after its ‘limited use’ is over. This can be an inspiration for the Indian model as well. However, this suggestion only has limited applicability. This is because Section 26 has extensive provisions which also allow such an expert to attend the oral proceedings of the arbitration, therefore allowing the greater risk of exposure to sensitive information. Thus, if any arbitration proceeding requires the expert to be present during the oral proceedings, then allowing redacted access to the expert will give rise to two new problems. Firstly, that there would be a breach of confidentiality and the other problem would be that even after breaching of confidentiality, an expert would be of no-good use as he had been provided redacted access to information in the first place. Secondly, this would seriously disable his application of knowledge to deal with an issue as an expert. V. CONCLUSION The watertight nature of the confidentiality provision under Section 42-A has made the applicability of this provision very limited, and many important provisions have been overlooked in the process of drafting of Section 42-A. As a result, this confidentiality clause fails to consider many exceptions and result in conflicting provisions. Section 42-A can be considered to be a visionary step rather than taken in haste. The principle of confidentiality undoubtedly is and will be the backbone of arbitration proceedings. Confidentiality is a fundamental principle to avoid the peril that can be caused if the trade secrets and other sensitive information of parties are not well-protected and maintained during the adjudication process. The issue of confidentiality is gaining international recognition and significant developments have been made. However, it is pertinent to mention that effective practical implementation has remained a vital challenge because in the Indian legal setup, the provision for confidentiality under the Arbitration and Conciliation Act, 1996, comes into direct conflict with other provisions of the act. The issue of convergence of Section 26 and Section 42-A as an individual legal right to confidentiality illustrates some important lessons. Given the escalation of use of arbitration for the purpose of settlement of disputes and the deficient attention to the parties right to confidentiality in the statute highlights to deal with this outstanding issue by the presence of a better and comprehensive textual provision is the need of the hour in order to do away with the stress of rules incertitude. The absence of this would pose a big question mark on the legal system and completely frustrate the objective of resorting to this mode of dispute settlement. The amendment regrettably did little to progress in the realm of confidentiality. It did recognize the issue of confidentiality. However, the provision in order to deal with it has been designed in such a way (Non-obstante clause and limited exceptions) that instead of dealing with the crisis, it has started another crisis on its own. At last, it can be said that the benefit of the confidentiality clause under the Arbitration and Conciliation Act, 1996 can be elucidated upon in a variety of ways. It can also be considered a remarkable step and a ray of light in the hope of achieving the status of the hub of International Commercial Arbitration for India. However, it comes with its own set of problems, primarily because of its conflicting nature with other provisions of the same act. With that, once this provision is customized to such an extent that it can have greater applicability without hindering the applicability of other provisions; the vision behind the conceptualization of confidentiality provision could be achieved. [1] Pratik Raj and Prasidhi Agrawal both are 4th year students of B.A., LL.B. (Hons.) at Chanakya National Law University Patna. They can be reached at rajpratik229000@gmail.com and agrawalprasidhi16@gmail.com respectively. [2] AIR 2010 SC 806. [3] AIR 1978 SC 1204. [4] Indian Evidence Act, 1872, § 45, No. 1, Acts of Parliament, 1872 (India). [5] Fakhruddin v. State of Madhya Pradesh, AIR 1967 SC 1326; Sultan Singh v. State of Haryana, (2014) 14 SCC 664; Ramesh Chandra Agarwal v. Regency Hospital Ltd., AIR 2010 SC 806. [6] AIR 1980 SC 531. [7] AIR 2006 SC 508. [8] Arbitration and Conciliation Act, 1996, § 42-A, No. 26, Acts of Parliament, 1996 (India). [9] Arbitration and Conciliation Act, 1996, § 26, No. 26, Acts of Parliament, 1996 (India). [10] Arbitration and Conciliation Act, 1996, § 36, No. 26, Acts of Parliament, 1996 (India). [11] (1782) 3 Doug. K.B. 157. [12] ICGJ 370 (PCA 2007). [13] (1995) 128 A.L.R. 391. [14] (1998) 118 F.R.D. 346. [15] Ali Shipping Corp. v. Shipyard Troggir, [1998] 2 All. E.R. 136; Emmott v. Michael Wilson & Partners Ltd., [2008] E.W.C.A. Civ. 184. [16] [2003] S.G.H.C. 124.

- Harshit Batra[1] In 2021, we are living in a world that derives its meaning from a piece of paper - a transaction, a proof, or in the most legal terms of all – a shred of evidence. Tangible evidence has become a sin quo non to the happening or non-happening of an event. Our society with the bedrock of the legal community has come far on its way of development. The importance of contracts and legal documents cannot be overstated – they are the primary poof of the very fundamental principle of ‘consent’ – they are the palpable proof of existence and hence, mandated to establish any relationship, more specifically, a commercial relationship. For such reasons, the rigid concept of ‘consent’ is established through the contractual nature of parties to a commercial relationship and thus, becomes the non-consensual type in the absence of a contract. However, with the development of society and the legal community, the rigidity of this concept of ‘consent’ has loosened and has become wide enough to include consent through the conduct of the parties, the concept of which has now been deeply established in many jurisdictions. To act under a contract, or to suppress the obligations under a contract, the parties should be privy to the same, as is followed by the transnational principle of international law – for which, consent is primary. In the regional context, the Indian Contract Act, 1872 mandates free consent in a contract.[2] ‘Consent’ is also fundamental to the process of arbitration, i.e., as a principle, only the parties that have consented to arbitration can arbitrate.[3] For such purposes, this matter of consent has not been limited to a contract. The presence of a contract is no more a sine quo non to an arbitration process – i.e., arbitration can be held between such parties that have no written contract between them, where the intention to arbitrate is sufficient to exclude the presence of rigid contractual nature.[4] It is given to understand that an arbitration agreement is required for arbitration to commence. However, it should not mean to be understood that such an arbitration agreement requires a defined contractual relationship. The UNCITRAL Model Law specifies that the parties must submit to arbitration in a “defined legal relationship, whether contractual or not”.[5] As a general practice, the parties enter into a contractual relationship (with free consent) and agree to submit to arbitration in case of a breach of a contract. However, with no such strict requirement, it is often argued that making a person who has not entered into a contract (a non-signatory), a party to an arbitration is non-consensual and against the very fundamental principles of arbitration. It is for this reason that arbitration can be validated with consent and contractual nature between the parties. The non-consenting non-signatory vs. the consenting non-signatory There exists a grey area in the understanding of consent in making a non-signatory party to an arbitration proceeding. Thus, as a clear understanding must allow – a non-signatory can be made a party to the arbitration agreement as long as the party is ‘consenting’, which is independent of the contractual nature of the parties. The aforementioned conduct establishing consent plays a vital role here as the intention of the parties takes supremacy. Consent through contracts is not the only way of establishing this intention – It is a settled position that the intention of the parties can be gathered from the correspondences exchanged between the parties[6] dividing the consent in explicit and implicit nature.[7] While explicit consent[8] would mean the presence of an agreement which would make the parties both consenting and signatory – thus posing no issue. It is the latter that is established through the conduct of the parties and is treated as ‘implied consent’[9]. It should also be noted that consent acts as an exception to the transnational principle of privity of contract. Recently, the United States Supreme Court in GE Energy Powe Conversion France SAS, Corp. v. Outokumpu Stainless USA,[10] held that nothing in the New York Convention[11] or the domestic law (Federal Arbitration Act) prohibits courts from deciding that non-signatories may be bound by or enforce arbitration agreements based on contract, agency, equity or related principles. The Supreme Court referred to the drafting history of the New York Convention and concluded that: "Nothing in the drafting history suggests that the Convention sought to prevent contracting states from applying domestic law that permits non-signatories to enforce arbitration agreements in additional circumstances." The Court found that the New York Convention does not address whether non-signatories may enforce arbitration agreements under domestic doctrines such as equitable estopped and according held that "silence is dispositive here because nothing in the text of the Convention could be read to otherwise prohibit the application of equitable estoppel doctrines." To make a consenting non-signatory party to an arbitration, certain principles can be relied on: 1. Officious bystander principle: An outdated principle in the present yet an obvious choice. This test laid down in Southern Foundries (1926) Ltd. v. Shirlaw[12] has been used to imply anything into a contract that has not been expressed as is so obvious of its existence. MacKinnon LJ wrote, "Prima facie that which in any contract is left to be implied and need not be expressed is something so obvious that it goes without saying; so that, if, while the parties were making their bargain, an officious bystander were to suggest some express provision for it in their agreement, they would testily suppress him with a common 'Oh, of course!'".[13] The less usage of this test is because of the subjectivity of intention and thus the ‘consenting’ nature of the parties involved. Even with the obvious nature of the conduct of the parties, is still remains to be subjective because of no set or straight jacket formulae of understanding of a reasonable man. 2. Ordinary principles of contract and agency: The court of appeals of the second circuit in Thomson-CSF v. AAA[14] has observed that a non-signatory party may be bound to an arbitration agreement if so is dictated by the "ordinary principles of contract and agency" which were discussed to be the following and has been followed since: a. Incorporation by reference: Under this principle, an indirect relationship subsists. A non-signatory may compel arbitration against a party to an arbitration agreement when that party has entered into a separate contractual relationship with the non-signatory which incorporates the existing arbitration clause.[15] b. Assumption: Based purely on the conduct of a non-signatory may lead to an assumption of an obligation of the parties to arbitrate. The ‘intention to be bound’ is mandated under this principle. c. Agency: The simplest, least controversial circumstance in which a non-signatory may be bound by an arbitration agreement is when an agent executes a contract on behalf of its principal. It is well-settled, under all developed legal systems, that one party (an “agent” or similar representative) may in certain circumstances legally bind another party (a “principal”) by its acts.[16] d. Veil-piercing/alter ego: This principle binds the subsidiary with the parent due to a sufficiently close relationship which justifies lifting of the corporate veil to see the actual relationship. Authorities from virtually all jurisdictions hold that a party who has not assented to a contract containing an arbitration clause may nonetheless be bound by the clause if that party is an “alter ego” of an entity that did execute, or was otherwise a party to, the agreement. This is a significant, but exceptional, departure from he fundamental principle that each company in a group of companies (a relatively modern concept) is a separate legal entity possessed of separate legal rights and liabilities.[17] It was observed[18] that to apply the alter ego doctrine to justify the disregard of a corporate entity, the court must determine that there is such unity of interest and ownership that separate personalities of the corporations no longer exist, and that failure to disregard the corporate form would result in fraud or injustice. e. Estoppel: Based on the conduct of the parties, this rule estops the party from running away from arbitration by claiming to be non-signatory. However, for the purposes of law and equity, a person cannot enjoy the benefits through his conduct and wiggle out of the obligations. It was observed in Tencara[19] that when a non-signatory receives direct benefits from the arbitration agreement, he is estopped from escaping from his liabilities therein. Under this doctrine, there needs to be a close relationship between the parties (the non-signatory with the signatory) and the claims are intimately founded in and intertwined with the underlying contract obligations.[20] Other widely used principles: 1. Group of companies doctrine: An exception to the principle of privity of contract, the present doctrine binds the companies of the same group and considers them to have a single legal entity or uneréalitééconomique unique.[21]The inextricable connections between the companies makes them bound by any agreement executed by a signatory. Some commentators refers to the non-signatory, to be less than an obvious party.[22] This doctrine is akin to principles of agency or implied consent, whereby the corporate affiliations among distinct legal entities provide the foundation for concluding that they were intended to be parties to an agreement, notwithstanding their formal status as non-signatories.[23] It was first established through the case of Dow Chemical v. Isover Saint Gobai[24]and invoked in the Chloro Controls India case.[25] The Delhi High Court[26] has observed that to bind a non-signatory to an arbitration proceeding without its prior consent can be an exceptional case. The Indian Supreme Court in the Mahanagar case[27] has observed that the doctrine of a group of companies is applicable in instances of a direct relationship between the signatory and the non-signatory, direct commonality of the subject matter and the composite nature of the transaction. India bulls was recently bound on the principles of estoppel, group of companies doctrine and alter ego, amongst others.[28] 2. Third-party beneficiary: It is generally accepted that if a third party is bound by the same obligations stipulated by a party to a contract and this contract contains an arbitration clause or, in relation to it, an arbitration agreement exists, such a third party is also bound by the arbitration clause, or an arbitration agreement, even if it did not sign it.[29] Such a non-signatory is considered a third-party beneficiary. The Delhi High Court recently in Shapoorji Pallonji considered the question of compelling a non-signatory to and arbitration. Here, a contractor-initiated arbitration proceedings against the developer and its subsidiary on the basis of an arbitration agreement with the subsidiary. Considering the question of making the non-signatory subsidiary, it was observed that whether a non-signatory is a direct beneficiary of the contract containing the arbitration clause is material in determining whether the said beneficiary can be compelled to arbitrate even though it is not a signatory to the Agreement. However, this is coupled with the condition that such benefit should be direct and not indirect. 3. Guarantor: To bind a non-signatory under this principle, the relationship between the parties, the contractual language of the guarantee agreement has to be seen and the underlying arbitration clause will be significant in ascertaining whether the parties intended that the guarantor to be bound (and benefited) by the arbitration clause in the underlying contract.[30] The non-signatory banks are also seen to be made a party on invocation of a bank guarantee under a Section 9 petition[31]. In a very recent case, the Delhi High Court[32] compelled India bulls to arbitrate even when it was a non-signatory on the basis, inter alia, of issuance of bank guarantees. It was observed in Kotak Mahindra Bank Ltd. v. Williamson Magor and Co. Ltd. and Another,[33]that where there is a controlling agreement and also a separate guarantee of the performance of agreed obligations, it is simply not enough to say (1) that there is no arbitration agreement; or (2) that it is for the person invoking the guarantee to demonstrate the intention to be bound. If the Chloro Controls principle is applied, as explained in Cheran Properties,[34] the task is a two-step process. First, one must assess whether the guarantee is enfolded within the umbrella, master or controlling agreement. If it is, and the guarantor seeks to escape the arbitration agreement within the master agreement, the second step is for the guarantor to show that they are not bound and did not intend to be bound. 3. Subrogation: Under many national legal systems, there are circumstances where one party may be subrogated to the contractual rights of another party. This frequently occurs in the case of insurers, who may be subrogated to the rights of insureds. In these circumstances, the insurer is typically entitled to invoke (and is bound by) the arbitration provisions of the insured’s underlying contract (from which the subrogated rights arise).[35] This arises mainly in the insurance and reinsurance in which the subrogee "stands in the shoes" of the original party to the agreement containing the arbitration clause.[36] 4. Succession: The dominant trend in case law holds that an arbitration agreement is not only valid between the parties, but can also be relied upon against their heirs, their legatees, their assignees and all those acquiring obligations. The only exceptions are cases where the arbitration agreement is drafted in such a way as to exclude successors and assignees.[37] 5. Ratification: A non-signatory to an agreement may subsequently become a party to that agreement upon ratification.[38] Ratification can occur with regard to arbitration agreements, as well as with other forms of commercial contracts. Likewise, in the case of novation, a new contract generally replaces a previous contract and one of the original parties is substituted by a new party as per the new contract. The same choice-of-law rules that apply to guarantee/guarantor relations should also apply in the context of ratification. As has been mentioned above, making non-signatories a party to an arbitration is an exceptional circumstance that can happen with the applicability of the abovementioned principles. The Delhi High Court[39] has observed that whenever a non-signatory third-party denies liability and sets up a title in itself and such denial raises disputed questions of fact which cannot be adjudicated without trial, in such cases, Section 9[40] against third parties may not be invoked. There exists a reluctance in binding the non-signatories to arbitration because of the rigid approach to bind the parties on a contractual basis. However, as has been observed by the Hon’ble Supreme Court of India,[41] “[c]ourts have to adopt a pragmatic approach and not a pedantic or technical approach while interpreting or construing an arbitration agreement or arbitration clause”. [1] Harshit Batra is an Advocate and RERA Consultant practicing Pan India. His areas of expertise include Dispute Resolution, RERA litigation and Criminal laws. He is also the National Coordinator of the Youth Bar Association of India (Regd.) which is involved in actively filing several Public Interest Litigations. One of the current cases is where a plea has been made before the Hon’ble Supreme Court to formulate SOP mandating Pre-Litigation Mediation across India. Harshit has pursued a five-year integrated law degree from Guru Gobind Singh Indraprastha University. He then, went on to do an LL.M in Alternate Dispute Resolution from VIPS (GGSIPU). Additionally, he holds two P.G. Diploma courses in Corporate Laws and Management from Indian Law Institute (ILI) and in International and National IPR Law from The Indian Academy of International Law & Diplomacy (Indian Society of International Law). [2] Section 10, Indian Contract Act, 1872, Section 14, Indian Contract Act, 1872 [3] Benson Lim, Adriama Uson, Relooking at Consent in Arbitration, Kluwer Arbitration Blog, http://arbitrationblog.kluwerarbitration.com/2019/02/12/relooking-at-consent-in-arbitration/ [4] Thomson-CSF v. AAA, 64 F.3d 773 (2d Cir. 1994) [5] UNCITRAL Model Law, art. 7. [6] Enercon (India) Ltd. & Ors.v. Enercon GMBH and Anr., (2014) 5 SCC 1 (India). [7] Award in ICC Case No. 5721, 117 J.D.I. (Clunet) 1019, 1024 (1990). [8] Section 7, Arbitration and Conciliation Act, 1996 [9] Shapoorji Pallonji and Co. Pvt. Ltd. vs. Rattan India Power Ltd. and Ors. (07.04.2021 - DELHC) : MANU/DE/0645/2021 [10] GE Energy Powe Conversion France SAS, Corp. v. Outokumpu Stainless USA LLC: 140 S.Ct. 1637, 1640 (2020) [11] Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 10 June 1958) [12] Southern Foundries (1926) Ltd. v. Shirlaw, [1939] 2 KB 206. [13] Id. [14] Thomson-CSF v. AAA, 64 F.3d 773 (2d Cir. 1994). [15] Import Export Steel Corp. v. Mississippi Valley Barge Line Co., 351 F.2d 503. [16] Final Award in ICC Case No. 6268, XVI Y.B. Comm. Arb. 119 (1991). [17] Adams v. Cape Indus. Plc, [1990] Ch 433, 532 (English Ct. App.). [18] Oriental Commercial & Shipping Co., Ltd v. Rosseel, NV, 609 F.Supp. 75, 78 (S.D.N.Y. 1985). [19] American Bureau of Shipping v. Tencara Shipyard SpA, 170 F. 3d 349 (2nd Cir. 1999). [20] Sunkist Soft Drinks, Inc. v. Sunkist Growers Inc., 10 F.3d 753, 757-58 (11th Cir. 1993). [21] Anna Kombikova, “Extension of the Arbitration Agreement to third parties based on the ‘Group of Companies’ and ‘Piercing the Corporate veil’ doctrines” available at https://www.international-arbitration-attorney.com/wp-content/uploads/arbitrationlawkombikova_anna.pdf [22] William Park, Non– Signatories and International Contracts: An Arbitrator’s Dilemma, Permanent Court of Arbitration, (2009). [23] Final Award in ICC Case No. 6519, 2(2) ICC Ct. Bull. 34, 35 (1991). [24] Dow Chemical v. Isover Saint Gobain, ICC Award No. 4131, YCA 1984, at 131 et seq. [25] Chloro Controls India (P) Ltd. v. Severn Trent Water Purification Inc., ( (2013) 1 SCC 641). [26] Magic Eye Developers Pvt. Ltd. v. Green Edge Infra Pvt. Ltd. & Ors., (CS(COMM) 1290/2018). [27] Mahanagar Telephone Nigam Ltd. v. Canara Bank & Ors, (2019 SCC OnLine SC 995). [28] Shapoorji Pallonji v. Rattan India Power Ltd (Delhi High Court, 07.04.2021). [29] Final Award in ICC Case No. 9762, XXIX Y.B. Comm. Arb. 26, 40 (2004). [30] W. Craig, W. Park & J. Paulsson, International Chamber of Commerce Arbitration, ¶5.10 (3d ed. 2000). [31] Section 9, Arbitration and Conciliation Act, 1996 [32] Shapoorji Pallonji v. Rattan India Power Ltd., (Delhi High Court, 07.04.2021). [33] Kotak Mahindra Bank Ltd. v. Williamson Magor and Co. Ltd. and Another, 2021 SCC OnLine Bom 305. [34] Cheran properties Limited v. Kasturi and sons limited & ors CIVIL APPEAL NOS 10025-10026 OF 2017 [35] Omağ, Merih Kemal, Türk Hukukunda Sigortacının Kanuni Halefiyeti, Istanbul 2001, p. 35 [36] Smith v. Pearl Ins. Co. Ltd., [1939] 1 All E.R. 95. [37] Award in ICC Case No. 2626, 105 J.D.I. (Clunet) 980, 981 (1978). [38] Kunal Mimani & Ishan Jhingran, “Extension of Arbitration Agreements to Non-Signatories: An International Perspective” Indian Law Journal available at https://www.indialawjournal.org/archives/volume4/issue_3/article_6.html [39] Avon Healthcare Services Ltd v. Trade international, (DB, 19.04.2021). [40] Section 9, Arbitration and Conciliation Act, 1996 [41] Enercon (India) Ltd. & Ors.v. Enercon GMBH and Anr., (2014) 5 SCC 1 (India).

-Aditya Rathore and Amit Chawla[1] 1. Introduction Investor-State Dispute Settlement (ISDS) is a legal provision in International Investment Agreements (IIAs) and the Bilateral/Multilateral Investments Treaties, aimed towards the resolution of disputes between foreign investors and the host-states. ISDS empowers the foreign investors to invoke arbitration against the host-states in the event they believe that the host government has violated the concerned investment agreements. As per United Nations Conference on Trade and Development (UNCTAD), the total number of ISDS cases surpassed the 1,000 mark in 2019[2] while as per International Centre for Settlement of Investment Disputes (ICSID), 838 cases have been registered under the ICSID Convention and Additional Facility Rules.[3] These figures are a clear manifestation of the increasing confidence of the foreign investors in the ISDS system and in particular, the ICSID. This confidence, as reposed by investors and the states in ISDS, largely draws from the arbitration’s ability to give a binding decision and thereby bring finality to the dispute at hand. This finality is not possible if the parties were to take the judicial recourse to resolve their dispute wherein, they need to climb the rungs of the ladder in form of several courts in the judicial hierarchy to reach a binding decision which can take years, if not decades. However, in the process of attaining finality, stakeholders have had to let go of their recourse to appealing the award, even if the award was based on errant reasoning. While ICSID does have an annulment procedure, prescribed under Article 52 of the ICSID Convention, the purpose it serves is very limited and comes nowhere close to an appeals facility. This lack of an appellate structure in ISDS, especially in ICSID, not only denies the parties the opportunity of appealing awards but also adds up to the fractured jurisprudence in investment arbitration by creating inconsistent awards on the same point of law. The authors, through this piece, will argue for the need for an appellate structure in the ICSID framework while discussing the finality vs correctness and consistency debate. The authors will further discuss the best possible option for an appellate structure in ICSID between a multi-lateral investment court or an appeals facility in ICSID. 2. Finality vs. Correctness & Consistency Proponents of international arbitration have time and again cited the important role played by institutions like ICSID in improving international cooperation and economic development all around the world. More so, the record number of cases for arbitration registered with ICSID also points in the same direction.[4] Nevertheless, this is not to say that opponents of international arbitration do not exist. On the contrary, institutions like ICSID are now under constant criticism for their perceived bias towards multinational corporations and the high costs associated with ICSID along with a lack of an appellate structure.[5] Several Latin American countries have already withdrawn from the ICSID Convention.[6] Amidst all the systemic issues (consistency in decisions, legitimacy and transparency, cost, etc.) highlighted time and again within ICSID, one issue that has always been at the center of the controversy is the lack of an appeals facility in ICSID. Amongst the international arbitration community, at the heart of the appeals facility question lies the finality vs. correctness and consistency debate. Members of the “finality” camp argue that ICSID arbitration removes the dispute from the hassle of the municipal courts and helps in providing predictability to the process.[7] Also, that the additional review system would impose heavy costs upon the parties and would also result in elongated proceedings. In addition to this, arbitrator bias against investors based on the notion that the state would have the power to appoint the arbitrator at the appellate stage and the additional caseload due to increased frequency of review appeals are some of the additional concerns associated with the appeal mechanism. On the contrary, members of the “correctness and consistency” camp argue that an appeal mechanism will help in bringing coherence and consistency to the already fragmented investment law jurisprudence.[8] An appeals facility can be an apt solution for keeping in check the constant inconsistent awards by the ICSID and other such tribunals on the same point of law. In CMS vs. Argentina[9] and LG&E vs. Argentina[10], tribunals in both these cases reached diverging conclusions over the validity of Argentina’s use of ‘state of necessity’ defence as an argument for the economic measures undertaken during the domestic downturn. The CMS tribunal had rejected this argument of the Argentine Republic whereas this argument, to a certain extent, was accepted by the LG&E tribunal. Similar instances of inconsistency in ICSID awards were observed in the SGS vs. Phillipines[11] and SGS vs. Pakistan.[12] These cases concerned themselves with textually similar umbrella clauses and the Tribunal had to determine whether the presence of an umbrella clause caused the breach of the contract into a breach of the treaty. Consequently, the tribunal in one of the cases held in the affirmative while in the other rejected the contention. These cases are an apt example of why the introduction of an appeals facility will allow for a smooth transition towards a precedent-based system which will help in ensuring consistency of jurisprudence as the decisions rendered could act as precedents in situations where two different awards are based on identical facts and legal principles and thereby increasing the legitimacy of the arbitral awards. As alluded to before, the ICSID does have an annulment procedure as well. Pursuant to an application for annulment under Article 52, an ad hoc annulment committee can annul the final award on the following grounds: (1) the tribunal was not properly constituted; (2) the Tribunal has manifestly exceeded its powers; (3) there was corruption on the part of a member of the Tribunal; (4) that there has been a serious departure from a fundamental rule of procedure; or (5) that the award has failed to state the reasons on which it is based. However, the constitution of an ad hoc committee, whenever an annulment application is made, has led to an extensive interpretation of the grounds of annulment[13] - Klockner vs. Cameroon,[14] Vivendi vs. Argentina[15] and MINE vs. Guinea[16] are such cases in point. Moreover, grounds for annulment are restricted solely to procedural irregularities and fail to take into account substantive measures like public policy. In fact, several questioned awards are not annulled because of the high standards set for the annulment procedure.[17] The high standard set for annulment procedure by the annulment committee concerns itself only with the legitimacy of the process in rendering the award. It has been observed that even if the awards are annulled, grounds are usually of wrong application of law rather than wrong interpretation of a correct law. Grounds such as failure to state correct reasons, erroneous interpretation of law, etc. are also not taken into account by the annulment committee. In comparison to annulment proceedings, an appeals facility will provide for a broader scope of review of an award (scope of review has been discussed in the next section).[18] In fact, investors and states alike, are perturbed by the fact that if they were to lose an ICSID arbitration based on erroneous reasoning, they will still have to comply with the award. Thus, to quell the rising discomfort amongst key stakeholders in ISDS, the authors believe that the establishment of an appeals facility in ICSID becomes pertinent. The methodology for the establishment of such an appeals facility will be discussed in the next section. 3. Multilateral Investment Court vs. Appeals facility The debate concerning the establishment of an appeal mechanism in ISDS can be traced the back to early 1990s.[19]Whereas it was only in 2004 when a proposal to establish an ICSID Appeals facility was tabled by the ICSID Secretariat which laid down a possible broad framework for the efficient implementation of the appeals facility.[20] Recently and more prominently, the United Nations Commission on International Trade Law (UNCITRAL) Working Group III has also been working on the ISDS reforms and has suggested: (i) establishment of a multilateral investment court and/or (ii) creation of an appeals facility.[21] The authors will also be making suggestions basis the UNCITRAL Working Group III reforms. 3.1. Multilateral Investment Court The rationale behind the establishment of a multilateral investment court (“MIC”) is the idea of setting up a permanent ICJ-like body that will be adjudicating upon appeals from all tribunals/institutions in ISDS. The establishment of MIC would be premised on a two-layered structure for dispute adjudication i.e., a first instance tribunal and an appellate tribunal which would comprise of permanent full-time members as the deciding authority on disputes referred. Sovereign states would be entrusted with the task of appointing the adjudicators and the non-state actors would be given the task of nominating or vetting the candidates. The members of the multilateral investment court would be expected to adhere to a strict code of ethical conduct while deciding disputes. Nevertheless, the composition and the functioning of MIC is fraught with criticism and concerns. The premise of MIC is based on the ground that the disputing party would have little or no role in appointing the arbitrators and the discretion to appoint the arbitrator rests solely with the state. This is in stark contrast to the principle of party autonomy which forms the backbone of arbitration and may also push the investor to lose confidence in the system. Concerning enforcement, the ISDS awards are enforceable in nearly every state however, if and when the MIC is constituted, it is highly probable that the setting up of MIC could disrupt the established procedures of enforcement of arbitral awards as there is no clarity on whether or not the awards rendered by MIC would be enforceable in jurisdictions that have not consented to MIC. 3.2. Appeals Facility A safer alternative to Multilateral Investment Court can be the establishment of an appeals facility within the ICSID Convention. In the normal course of proceedings in ICSID, an award made under the convention is binding on the parties and is not subject to any appeal and the only recourse available to parties is to file for annulment of the award. This can often lead to the party being left remediless, even if the award by the tribunal is based on an erroneous application of the law. However, an appeals facility within the ICSID would ensure that such questionable or faulty awards are subjected to an additional review and thus, providing the parties with an additional remedy. The appeals facility in ICSID can be based on the blueprint of WTO Appellate Body with an eminent pool of highly qualified and experienced arbitrators. An appeals facility, based on the lines of the dispute settlement system of WTO, would go a long way could help in dealing with the credibility crisis faced by the first instance tribunal. At this juncture, it is important to clarify that the establishment of an appellate body will not imply that the award rendered by the first instance tribunals lacks authority. In fact, the appeals facility by acting as a watchdog over the decisions rendered by the first instance tribunals will not only ensure that awards are rendered error-free but also will help in unifying the fragmented investment law jurisprudence. Nevertheless, this is not to say that the appeals facility is completely fool-proof and in fact, this set-up is also plagued with certain disadvantages such as the elongated costs and duration of proceedings, additional caseload due to filing of review applications, etc. Questions pertaining to the extent and standard of review of the appellate tribunal have also been raised. Critics have also time and again argued the merits of annulment provision over an appeals facility. In the humble views of the authors, an appeals facility is desirable as the ICSID annulment committee does not possess the power to rectify mistakes in the award despite identifying one. Also, as per Article 52(3) of the convention, the power to constitute the ad hoc annulment committee given to the ICSID Chairman without consulting the parties to the dispute raises pertinent doubts about the constitution of the ad hoc committee.[22] An appeals facility after taking into consideration the practical challenges can be a wise choice to tackle these issues. As regards the scope of review, the authors suggest that public policy should also be subject to appeal in addition to the grounds stipulated under Article 52. Public policy, one of the most important facets in any arbitration, has been excluded from the annulment grounds mentioned in Article 52 of ICSID when in fact, Article 34 of the UNCITRAL Model Law explicitly states that the arbitral award can be set aside if it conflicts with the public policy of the state. More so, whether the arbitral award violates public policy or not is a primary consideration for the national courts while hearing any appeals against the validity of the award. Additionally, the authors suggest that a de novo appreciation of law and facts at an appellate stage would result in elongated proceedings and impose a heavy cost on the parties. Hence, only manifest errors of facts along with errors of law should be subjected to appeal. The authors also suggest that the appeals facility could also explore a possibility to limit the scope of an appeal to certain facets of law such as principles of expropriation, non-discrimination, fair and equitable treatment etc. Also, subjecting only manifest errors of fact would accord a degree of deference to the conclusions reached by the first-instance tribunal and would help in reducing costs and delays. Manifest errors would also help in guiding the appeals facility in determining if errors based on facts for ex., dishonest testimony, failure to take into account any document etc. have influenced the decision of the first instance tribunal. This is also supported by the fact that The Comprehensive Economic Trade Agreement (CETA) entered into between EU and Canada which aims to bring the agreement in consonance with the Investment Court system also signifies the need for an appellate structure that would allow appeals based on issues of law and manifest errors of facts.[23] The WTO Appellate body also has a dedicated self-contained appeals mechanism however, appeals can only be instituted based on an issue of law and not of facts. The Appellate Body also has the power to uphold, modify and even reverse the findings of the panel but the annulment procedure under ICSID is only limited to the watertight provisions which run contrary to the scheme of WTO appellate body which provides appeals on substantive issues of law and also on errors in the interpretation of WTO provisions, if any. On the contrary, the ICSID Convention is only concerned with the legitimacy of the process even if it results in an error of law while the WTO appellate body is also tasked with the review of panel decisions if they are based on an error in interpreting any WTO provisions. In the humble views of the authors, despite the practical challenges posed by an appeals facility in ICSID, it remains a considerate choice as the parties would now have a remedy against awards that contain errors of law rather than just filing for an annulment of such awards. It would also help in ensuring consistency in the awards by setting up precedents for cases where the treaties are similarly worded and have identical facts. The appeals facility would help to enhance a great deal of confidence in the investment law system and would pave the way for a progressive investment regime. 4. Conclusion The authors, through this piece, have endeavoured to discuss the idea of establishing an appellate structure in the ICSID, while shedding light on possible pros and cons of such a procedure. The authors have discussed that the setup of an appellate structure in ICSID can either be fulfilled through the establishment of a MIC or an appeals facility in ICSID, however, both the setups pose their own set of problems. It suffices to say that a decision on establishing an appellate structure will involve a discussion from all the stakeholders of ICSID which in itself is a daunting task. As a matter of fact, the ICSID itself had abandoned the idea of establishing an appeals facility in 2005 (a year after it had initiated such a discussion) citing such an attempt as “premature”.[24] However, with the upsurge in economic investments and ISDS, the time has become ripe enough for the ICSID to not only reinitiate the discussion but also to take active steps towards the establishment of an appellate structure. [1] Aditya Rathore is a final-year student at NLU Odisha. He can be reached at rathore.aditya731@live.com. Amit Chawla is a law graduate and can be reached at­­­­ amit.chawla016@gmail.com. [2] UNCTAD, ‘Investor-State Dispute Settlement Cases Pass The 1,000 Mark: Cases and Outcomes in 2019’ < https://unctad.org/system/files/official-document/diaepcbinf2020d6.pdf> accessed 7 August 2021. [3] ICSID, ‘The ICSID Caseload-Statistics’ accessed 8 August 2021. [4] Pinsent Masons, ‘Record year for arbitration cases registered with ICSID’ accessed 8 August 2021. [5] Silvia Karina Fiezzoni, ‘The Challenge of UNASUR Member Countries to Replace ICSID Arbitration’ (2011) 2 BLR accessed 7 August 2021. [6] Nicolas Boeglin, ‘ICSID and Latin America: Criticisms, Withdrawals and Regional Alternatives’ (bilaterals.org, June 2013 ) accessed 9 August 2021. [7] ‘UNCITRAL Working Group III: Reforms in the Realm of Investor-State Disputes - UNCITRAL’s Proposals for an Appeals facility and Its Impact on Duration and Cost’ (Kluwer Arbitration Blog, 26 March 2020) accessed 9 August 2021. [8] Thomas W Walsh, 'Substantive Review of ICSID Awards: Is the Desire for Accuracy Sufficient to Compromise Finality' (2006) 24 BJIL 444 accessed 7 August 2021. [9] CMS Gas Transmission Company v. The Republic of Argentina, ICSID Case No. ARB/01/8. [10] LG&E Energy Corp., LG&E Capital Corp., and LG&E International, Inc .v. Argentine Republic, ICSID Case No. ARB/02/1. [11] SGS Societe Generale de Surveillance S.A. v. Republic of the Philippines, ICSID (W. Bank) ARB/02/6 [12] Societe Generale de Surveillance S.A. v. Islamic Republic of Pakistan, ICSID (W. Bank) ARB/01/13. [13] Christoph Schreuer, ‘From ICSID Annulment To Appeal Half Way Down The Slippery Slope’ accessed 29 August 2021. [14] Klöckner Industrie-Anlagen GmbH and others v. United Republic of Cameroon and Société Camerounaise des Engrais, ICSID Case No. ARB/81/2. [15] Compañiá de Aguas del Aconquija S.A. and Vivendi Universal S.A. v. Argentine Republic, ICSID Case No. ARB/97/3. [16] Maritime International Nominees Establishment v. Republic of Guinea, ICSID Case No. ARB/84/4. [17] Tai-Heng Cheng, ‘Reconsidering ICSID Awards’ accessed 31 August 2021. [18] Thomas W Walsh, 'Substantive Review of ICSID Awards: Is the Desire for Accuracy Sufficient to Compromise Finality' (2006) 24 BJIL 444 accessed 7 August 2021. [19] Albert Jan van den Berg, ‘Appeal Mechanism for ISDS Awards: Interaction with the New York and ICSID Conventions’ (2019) 34 (1) ICSID Review accessed 8 August 2021. [20] Secretariat, I.C.S.I.D., ‘Appeal Mechanism for ISDS Awards: Interaction with the New York and ICSID Conventions’ accessed 7 August 2021. [21] Secretariat, I.C.S.I.D., ‘Appeal Mechanism for ISDS Awards: Interaction with the New York and ICSID Conventions’ accessed 7 August 2021. [22] David Collins, ICSID Annulment Committee Appointments: Too Much Discretion for the Chairman? (2013), available: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2246756 [23] EU-CETA, Article 8.28.2 [24] Secretariat, I.C.S.I.D., ‘Suggested Changes to the ICSID Rules and Regulations’ < https://icsid.worldbank.org/sites/default/files/Suggested%20Changes%20to%20the%20ICSID%20Rules%20and%20Regulations.pdf> accessed 7 August 2021.

Swetalana Rout In a significant ruling of the Supreme Court[1], it has been decided that the scope of power of a Court is limited to the grounds under Section 34 of the Arbitration and Conciliation Act, 1996 [hereinafter “1996 Act”]. The Apex Court held that Courts cannot modify or vary an arbitral award and has no power to do so. It also highlights the remodelling of Section 34 in accordance with UNCITRAL Model Law on International Commercial Arbitration, 1985 [hereinafter “Model Law”]. Factual Matrix: A series of appeals arose before the Apex Court with respect to the notifications issued under the National Highways Act, 1956 [hereinafter “NH Act”] comprising of awards given by the Competent Authority based on the guideline value of the specific lands and not on sale deeds. As a result, , significantly lower amounts were granted by the relevant authorities. The arbitrator appointed by the government (District Collector) did not find irregularities in the compensation amounts and approved the same. However, after the award was challenged in the District and Sessions Court, the Judge enhanced the amount and in reality, modified the award. The High Court of Madras also affirmed the modification. Thus, the Apex Court had to decide whether the power of a court under Section 34 of the 1996 Act to “set aside” an award of an arbitrator would include the power to modify such an award. Opinion of the Court: The Apex Court took note of the fact that Section 34 is an appellate provision in nature and an award can be set aside only as per the grounds mentioned in subsections (2) and (3) of Section 34. It further held, “Quite obviously if one were to include the power to modify an award in Section 34, one would be crossing the Lakshman Rekha and doing what, according to the justice of a case, ought to be done. In interpreting a statutory provision, a Judge must put himself in the shoes of Parliament and then ask whether Parliament intended this result. Parliament very clearly intended that no power of modification of an award exists in Section 34 of the Arbitration Act, 1996. It is only for Parliament to amend the aforesaid provision in the light of the experience of the courts in the working of the Arbitration Act, 1996, and bring it in line with other legislations the world over.” Since it is the opinion of the Tribunal that counts to eliminate grounds of setting aside an award, it can be indicated by the Court hearing the Section 34 application. This particular provision is largely based on Model law, which gives no discretion to a Court to modify/vary an award. The Apex Court has also referred to some cases including McDermott International Inc. v. Burn Standard Co. Ltd.[2] and Dakshin Haryana Bijli Vitran Nigam Ltd. v. Navigant Technologies Pvt. Ltd.[3] The Mcdermott[4] judgement specifies that where the Court sets aside the award passed by the majority members of the tribunal, the underlying disputes would require to be decided afresh in an appropriate proceeding. Under Section 34 of the 1996 Act, the Court may either “dismiss the objections filed, and uphold the award, or set aside the award if the grounds contained in sub-sections (2) and (2A) are made out”. There is no power to modify an arbitral award. There have been a plethora of cases indicating that the High Court is instructive. In Cybernetics Network Pvt. Ltd. v. Bisquare Technologies Pvt. Ltd.[5], the Delhi High Court pointed out that courts cannot deal with claims in detail which are already decided on by the Arbitral Tribunal even if it appeared that the Tribunal/Arbitrator has erred in rejecting a few claims under the power given to the Courts under Section 34(4). Another judgement delivered by the Delhi High Court[6]held that under the Arbitration Act, a successful challenge can lead to setting aside of an award, which was distinct from the power of the court under the Arbitration and Conciliation Act, 1940 [hereinafter “1940 Act”], as per which an award could be modified. Additionally, the decision in Puri Construction P. Ltd. v. Larsen and Toubro Ltd.[7] was also taken into consideration, where the Delhi High Court, while reiterating the law laid down in McDermott,[8] held that the power to modify, vary or remit the award does not exist under Section 34 of the Arbitration Act. The Delhi High Court held that a Court modifying or varying the award, would in essence be correcting the errors of the arbitrator. The Court also referred to Gayatri Balaswamy[9], relied on by the Respondent, which held that Mcdermott[10]did not settle the issue of modification by Court under Section 34. The Court observed that the judgements relied upon in Gayatri Balaswamy were the modified awards in the exercise of powers under Article 142 of the Constitution of India.[11] Hence, this judgement was wrong in holding that the judicial trend shows that this provision has the power to modify, revise or vary an award. Another decision of the Madras High Court was highlighted to reiterate Mcdermott’s position that a modification is not possible under Section 34. Several other cases cited by the Respondent were also rendered irrelevant by the Apex Court since they were also passed in accordance with Article 142 of the Constitution[12] and did not constitute the ratio decidendi. Analysis of NHAI vs. M. Hakeem: To interpret the current judicial trend and reading Section 34 as a power to modify, revise or vary an award would be akin to bringing back the previous law under the 1940 Act to the limelight. It would lead to ignoring the fact that the 1996 Act was based on the Model Law and was remodelled accordingly. Section 34 has also been compared with the provisions for challenging an award under the Arbitration Acts across the globe in this decision. It is explicit that there are provisions exclusively in their legislations, that permit varying the award, unlike Section 34. Further, the Apex Court also held that to assimilate the Section 34 jurisdiction with the revisional jurisdiction under Section 115 of the Code of Civil Procedure, 1908[hereinafter “CPC,1908”][13] is fallacious. Since Section 115 of the CPC, 1908 sets out three grounds for entertaining a revision and states that the High Court may make ‘such order as it thinks fit’ which are clearly missing in Section 34, it is not possible to interpret the award that way. The legislative intent was also cleared out in this judgement. In the decision, ‘purposive construction’ was referred to by Bennion in his classic on Statutory Interpretation, re-affirming that it must be applied on the facts of this case as in legislations dealing with land acquisition, a pragmatic view is required to be taken and the law must be interpreted purposefully and realistically so that the benefit reaches the masses. Purposive construction of statutes, relevant in the present context, was referred to in a recent concurring judgment of Eera v. State (NCT of Delhi),[14] as the theory of “creative interpretation”. However, even “creative interpretation” has its limits. The legislators did not intend to use the word “modify” anywhere in Section 34 of the Act but what was contemplated is only to “set aside” an award passed by the Arbitrator if it falls within the realm of Section 34 of the Act. There are a number of case laws where NHAI has not filed an appeal arising out of the Section 3A Notification, resulting in several land owners getting away with more compensation given by the District Court. We cannot be blindfolded by the fact that the award is based on the “guideline value” relevant only for stamp duty purposes and completely ignoring the sale deeds which are a correct measure of the land value. The Court also acknowledged the fact that differential compensation cannot be awarded solely to achieve a different public purpose. The public purpose can be extremely commendable, but the legislature cannot say that the award for the differential compensation is to be paid depending on the same. Conclusion: As per the High Courts, there is a difference of opinion on the issue of modification of awards. Hence, the Hakeem[15]judgement lays down a significant rule since it clarifies the position of Section 34 that Courts can neither modify, revise or vary an award. This decision places importance on the minimal judicial interference of Courts which is the basis of any arbitration. This decision is also consistent with the legislative intent and the recent amendments made to the Arbitration Act, specifically Section 34. [1]National Highways No. 45E and 220 National Highways Authority of India v. M. Hakeem, 2021 SCC OnLine SC 473. [2] McDermott International Inc. v. Burn Standard Co. Ltd. , (2006) 11 SCC 181. [3] Dakshin Haryana Bijli Vitran Nigam Ltd. v. Navigant Technologies Pvt. Ltd., 2021 SCC OnLine SC 157. [4] Supra note 2. [5] Cybernetics Network Pvt. Ltd. v. Bisquare Technologies Pvt. Ltd, 2012 SCC OnLine Del 1155. [6] Nussli Switzerland Ltd. v. Organizing Committee Commonwealth Games, 2014 SCC OnLine Del 4834 [7] Puri Construction P. Ltd. v. Larsen and Toubro Ltd., 2015 SCC OnLine Del 9126. [8] Supra note 2. [9] Gayatri Balaswamy v. ISG Novasoft Technologies Ltd., 2014 SCC OnLine Mad 6568. [10] Supra note 2. [11] The Constitution of India, 1950, Article 142. [12] Id. [13] The Code of Civil Procedure, 1908, Section 115. [14] Eera v. State (NCT of Delhi), (2017) 15 SCC 133. [15] Supra note 1.

*Snehil Balani Understanding the Problem There is a constant wiggle between international arbitration proceedings and cross-border insolvency due to their opposite nature which often creates two extreme sides, in which none of them can be labelled as right or wrong. The intersection between the two can be seen more frequently in the times of covid as corporations and businesses were not able to comply with their international contractual obligations which led to international arbitration proceedings and on the other hand were not able to pay-back to the creditors which led to initiation of domestic insolvency proceedings against them. This led to parallel international arbitration and domestic insolvency proceedings against the same party. The conflict between the two was aptly explained by the Singapore Court of Appeal in the case of Larsen Oil and Gas Pte Ltd. v. Petroprod Ltd. (2011) as “Arbitration and insolvency processes embody, to an extent, contrasting legal policies. On the one hand, arbitration embodies the principles of party autonomy and the decentralisation of private dispute resolution. On the other hand, the insolvency process is a collective statutory proceeding that involves the public centralisation of disputes so as to achieve economic efficiency and optimal returns for creditors.” The intersection and conflict can be explained through an example: Party ‘A’ (residing in India) enters into a commercial contract for delivering certain goods to party ‘B’ (residing outside India). The contract contained an arbitration clause which provided that any or all disputes arising out of or in connection with the contract shall be finally resolved by arbitration in accordance with SIAC rules. The seat of the proceedings shall be Singapore and the contract shall be governed according to the laws of India. ‘A’ failed to comply with the contract and an arbitration proceeding is initiated by ‘B’ for breach of contract and damages. Subsequently, an insolvency proceeding by a different creditor in India against ‘A’ was admitted to CIRP and a moratorium is passed against ‘A’ under section 14 of the Insolvency and Bankruptcy Code, 2016 (“IBC” hereinafter). Now, a lot of questions arise in the present scenario, such as - Will the moratorium include a foreign seated arbitration within its ambit in order to stay the arbitration proceedings? No, in order to recognize foreign seated arbitration, there needs to be a pact between countries to recognise the same and India holds no such pact with other countries. But, it can be recognised on a case-to-case basis as illustrated in the further segments. - What are the possible repercussions that might arise if the arbitration proceeding is stayed recognising the insolvency proceedings in India? Possible repercussions include violation of party autonomy and pacta sunt servanda. - What are the repercussions if the arbitration proceeding is not stayed? It will go against the interest of the creditors and also against the principle of audi alteram partem which is one of the fundamental principles of natural justice. - Is there a mid-way? Ultimately, the probable solution regarding the conflict as addressed by different international organisations and networks was to recognise the insolvency proceedings moratorium in the interest of all the parties involved. Detailed analysis for the above points is covered in the following segments. Why Should Insolvency Proceedings be Recognised Under the International Arbitration? If the arbitral proceedings are continued and no stay is granted then it will be “contrary to the public policy of India”.Section 48(2)(b) of the Arbitration and Conciliation Act, 1996 (“the act” hereinafter) explains the term as: - Induced or affected by fraud or corruption; or - In contravention with the fundamental policy of Indian law; or - In conflict with most basic notions of morality or justice. The phrase ‘contrary to the public policy of India’ was further explained by the apex court within the context of section 48(2)(b) of the act in the case of Ssyangyong Engineering and Construction Co. Ltd. v. National Highway Authority of India (2019). It stated that “fundamental policy of law” includes principles of natural justice. This was in line with the judgment of Renusagar Power Co. Ltd. v. General Electric Co. (1994). Audi Alteram Partem (the rule of fair hearing) is one of the most basic principles of natural justice which states that rights/liberty/property of a person should not be affected without him being given a chance to represent himself and it was explained by the apex court in the case of Smt, Maneka Gandhi v. Union of India and Anr.(1978) as “even where there is no specific provision for showing cause, yet in a proposed action which affects the rights of an individual it is the duty of the authority to give reasonable opportunity to be heard”. If arbitral proceedings are conducted and an award is passed against party ‘A’ then it will affect his assets and property, in turn affecting the amount received by other creditors. Here, the rights and property of other creditors are being affected through the decision by the arbitral tribunal without giving them a chance for representing themselves, which will be contrary to the public policy of India and thus, unenforceable according to the laws of India under section 48(2)(b) of the act. The exception of public policy is also highlighted under Chapter VII of the UNCITRAL Model Law, Article V(2)(b) of the New York Convention. Why Should the Arbitration Proceedings be Given Effect and Insolvency Proceedings Not To be Recognised? There are multiple reasons as to why a stay should not be granted in the present example. If a stay is granted it will be “against the intent of the parties” which is one of the fundamental principles of international arbitration law. This principle has been highlighted by multiple courts and tribunal across the globe, for eg. by the Singapore court of appeal in the case of Insigma Technology Co. Ltd. v. Alstom Technology Ltd. (2009). The court held that “courts should construe an arbitration agreement so as to give effect to a clear intention evinced by the parties to settle their dispute by arbitration”. Stay in proceedings will also be against the principle of “pacta sunt servanda”. This is a common principle of international law which provides that “agreements must be kept”. In the present example, the agreement and intent of the parties to resolve any or all disputes arising out of the contract by arbitration would not be recognised if a stay is granted by recognising the insolvency proceedings. Also, the IBC extends to the whole of India according to Section 1(2) of it. So, the moratorium cannot have an effect on a Singapore seated international arbitration. Finding the Tryst This conflict between the two was explained by the U.S. courts in Re United States Lines Inc (1999) as “a conflict of near polar extremes: bankruptcy policy exerts an inexorable pull towards centralization while arbitration policy advocates a decentralised approach towards dispute resolution”. The issue between the two was attempted to be resolved by the UNCITRAL Model Law on Cross-Border Insolvency (“Model Law” hereinafter) which provides for a stay of arbitral proceedings under article 20 if, foreign insolvency proceedings have been recognised. Another attempt was made by the Judicial Insolvency Network (“JIN” hereinafter) provides to recognise cross-border insolvencies but only among signatory nations. Currently, 49 states have adopted the Model law and 16 jurisdictions have adopted the JIN guidelines. Thus, the conflict is tried to be resolved by putting a stay to arbitral proceedings and recognising cross-border insolvencies through the above-mentioned treaties. The problem in India is the non-adoption of such treaties in order to recognise foreign insolvency proceedings in India and vice-versa. Even though, Section 234 of the IBC provides for “agreements with foreign countries”, but it is not utilized for entering into bilateral treaties with foreign countries in order to recognise insolvency proceedings. Ultimately, recognition of insolvency can provide the best solution because it takes into consideration the interest of the larger group of creditors and is not limited to one creditor. Also, the person claiming the amount through arbitration proceedings (‘B’ in the present example) can get his remedy along with other creditors through the process of insolvency. This will ultimately help him to get his claim and not compromise with the interest of other parties. In the long term, the problem of recognition of cross-border insolvency for India can only be solved by adopting Model law and JIN guidelines. Until then, the short-term solution would be to recognise insolvencies on a case-to-case basis, keeping in mind the interest of all the parties. The same thing was done by NCLAT (National Company Law Appellate Tribunal) in the case of Jet Airways (India) Ltd. v. State Bank of India & anr. (2019). It recognised a Dutch foreign insolvency proceeding in India even without having a formal pact for recognition of insolvency proceedings between both countries. NCLAT did so by keeping in mind the interest at large which includes the interest of other creditors involved in the case. Even though, the case did not include an arbitration proceeding but this case provides the certainty that courts and tribunals can recognise foreign insolvency proceedings even without having a pact between the two countries. And this is what needs to be done until India adopts the Model law and JIN guidelines. Conclusion From the above analysis it can be concluded equality must be maintained among all the parties involved in a particular scenario (parties seeking arbitration and creditors seeking insolvency). Arbitration proceedings should not take away the rights of the creditors in the name of party autonomy and pacta sunt servanda. Arbitration proceedings should not be held at the cost of the interest of the creditors. By recognising moratorium, all the parties can seek their lending and damages under a same mechanism (insolvency proceedings) which is not detrimental to either of the parties. Thus, there is a need for optimum use of section 234 of the IBC in order to enter into agreements with foreign countries for recognition of cross-border insolvency proceedings and until then recognition can be done on a case-to-case basis.

-Rohan Gulati* INTRODUCTION The hotly debated and persisting conundrum of seat and venue of arbitration has been a canvas that has been painted with several strokes of paint [judgments]. Be that as it may, the fact that these paint strokes have been made by different brushes [different approaches and reasoning] is perhaps the perplexing aspect altogether. Somewhere between the fine margins, the enigma of exclusive jurisdiction clauses and forum selection clauses has garnered immense interest. Before deep-diving into the intricacies of the debate and a flood of judgments, it is indispensable to pause, take a step back, and highlight the most recognized principle of the seat of arbitration in the context of exclusive jurisdiction clauses. Simply put, in cases where a seat of arbitration is designated by the parties, the courts at the seat of arbitration will have jurisdiction in respect of all cases arising out of or in relation to such arbitration.[1] Such jurisdiction has been referred to as the supervisory jurisdiction of the seat court since the seat has been considered to hold the center of gravity.[2] Unfortunately, in the Indian jurisdiction, at times, contracts carry two different jurisdictional clauses, i.e., a clause that stipulates the seat of arbitration (commonly referred as the ‘exclusive jurisdiction clause’) and another clause that stipulates the courts that hold the jurisdiction in case of any dispute (commonly referred as the ‘forum selection clause’). These two jurisdiction clauses carry their distinct legal implications respectively but become dichotomous when included in the same contract. In an attempt to decode the afore-stated dichotomy, three different High Courts in India hand-picked three different brushes [different approaches] and each of them painted a different stroke on a brand-new canvas. The purpose of this article is to go stroke-wise [judgment-wise], identify the best stroke [the ideal and correct judgment], and highlight the stroke that hand-picked the wrong brush [the judgment that did not follow the correct law]. [Note: The words ‘exclusive jurisdiction’ and ‘seat of arbitration’ will be used interchangeably in the article.] THE FIRST STROKE The Hon’ble Delhi High Court (“Delhi High Court”) in the case of My Preferred Transformation and Hospitality Pvt. Ltd. v. Sumithra Inn[3] was confronted with a situation where a Management Services Agreement (“MSA”) stipulated that the courts of New Delhi would have exclusive jurisdiction insofar as the arbitration proceedings were concerned but the courts at Bangalore would have jurisdiction for all matters arising out of the MSA. The petitioner in the instant case had approached the Delhi High Court under Section 11(6) of the Arbitration and Conciliation Act, 1996 (“1996 Act”) and the respondent vehemently opposed the same on the ground that in accordance with the MSA, the courts at Bangalore had the appropriate jurisdiction to appoint an arbitrator under Section 11(6) of the 1996 Act. Thus, the Delhi High Court had to resolve the tussle between an exclusive jurisdiction clause and a forum selection clause, both stipulated under the MSA, and whether the Delhi High Court was forum conveniens. The Delhi High Court laid down 4 permutations and combinations that could arise in such situations (not limited to the MSA): · Cases in which the contract only contained a ‘forum selection’ clause, but no ‘seat of arbitration’ clause; · Cases in which the contract contained a ‘seat of arbitration’ clause but not a ‘forum selection’ clause; · Cases in which the contract contained a ‘seat of arbitration’ and a ‘forum selection’ clause and both clauses vested jurisdiction in the same court, or courts at the same territorial location; or · Cases in which the contract contained a ‘seat of arbitration’ and a ‘forum selection’ clause, vesting jurisdiction in courts at different territorial locations. [Note: In the afore-stated four scenarios, the Delhi High Court had used the words ‘exclusive jurisdiction’ which have been replaced with the words ‘forum selection clause’ to maintain consistency in the language throughout the article.] It was prima facie apparent that the instant case fell into the last category. The Delhi High Court then relied upon the judgment of the Hon’ble Supreme Court of India (“Supreme Court”), delivered in the case of Mankastu Impex Pvt. Ltd. v. Airvisual Ltd.[4] (“Mankastu Impex”), wherein the Supreme Court was confronted with an identical set of facts, albeit regarding an international commercial arbitration. The Supreme Court there had opined that since Hong Kong was designated as the seat of arbitration, the same would have precedence over the forum selection clause. Thus, following on the lines of Mankastu Impex, the Delhi High Court observed that merely conferring jurisdiction upon the courts at Bangalore would not mean that the Section 11 petition would lie before the High Court of Karnataka at Bangalore.[5] Additionally, by combining two pertinent aspects - first, there was no provision that specifically conferred jurisdiction, and second, the seat of arbitration was agreed to be New Delhi in the MSA - the Delhi High Court concluded that it would be vested with the jurisdiction under Section 11 of the 1996 Act. Whilst the stroke painted by the Delhi High Court appears to be with the correct brush, there is certainly more than what meets the eye. While answering the issue of jurisdiction, the Delhi High Court observed the following (emphasis added): “42. In the case of a domestic arbitration…the Court, having jurisdiction over the seat of arbitration, would be exclusively competent to entertain petitions under the 1996 Act, in exercise of its supervisory jurisdiction over the arbitral process, unless there is a separate clause conferring exclusive jurisdiction on a court in another territorial location, qua the particular provision which is in issue. If, in other words, in the present case, the MSA were to contain an exclusive jurisdiction clause, conferring exclusive section 11 jurisdiction on a court located elsewhere than at New Delhi, the situation may have been different. There is, however, no such specific exclusive jurisdiction clause; ergo, territorial jurisdiction, to entertain the present petition under Section 11 of the 1996 Act, thus, has to abide by the seat of arbitration which is, undisputedly, New Delhi.”[6] From a bare perusal, the Delhi High Court essentially highlighted that if a clause conferred a ‘provision-specific’ jurisdiction upon a ‘particular’ court, it would prevail over and above the exclusive jurisdiction (that designates the seat of arbitration). This observation may be in conflict with the existing landscape and lead to an anomaly even in the instant case or where contracting parties may wish for the Delhi High Court to adjudicate a Section 11 petition and for the Madras High Court to adjudicate a Section 34 petition, even when the seat of arbitration is Bangalore. This would effectively turn the exclusive jurisdiction clause entirely redundant. Therefore, the reasoning of the Delhi High Court that primarily conveys that a forum selection clause, if conferred with ‘provision-specific’ jurisdiction will supersede the courts at the seat of arbitration, seems to be largely flawed and inconsistent in light of the ratios in the case of BGS SGS Soma JV v. NHPC Ltd.[7] (“BGS Soma”) and Indus Mobile Distribution Pvt. Ltd. v. Datawind Innovations Pvt. Ltd.[8] (“Indus Mobile”). Both BGS Soma and Indus Mobile had similar issues and held that if there exists a clause that designates the seat of arbitration, it implies that the courts at the seat of arbitration would have the jurisdiction and the clause would thereby be akin to an exclusive jurisdiction clause. THE SECOND STROKE The second stroke on the canvas came from the Hon’ble Calcutta High Court (“Calcutta High Court”) in the case of Bowlopedia Restaurants India Ltd. v. Devyani International Ltd.[9] (“Bowlopedia Restaurants”). The case concerned a Section 9 petition that involved the question of jurisdiction - the courts at Kolkata were vested with the jurisdiction but the seat of arbitration was agreed to be at New Delhi. The Calcutta High Court framed the issue as: when there is a forum selection clause that stipulates a different court over the seat of arbitration, whether it would override the latter? Whilst answering the afore-stated issue in affirmative, the Calcutta High Court premised its ruling on two pillars viz., (i) the principle of party autonomy and (ii) a part of the cause of action arising within the territorial limits of the Calcutta High Court. That being said, the Court disregarded the essence and weight of the seat of arbitration in domestic cases and held that the significance of seat and venue is material to international commercial arbitration and not domestic arbitration. According to the Court, the seat of arbitration clause will be significant in a case where the forum selection clause is absent. In all other cases, party autonomy would dictate that the seat of arbitration clause be overridden by the forum selection clause as the courts at the forum will also hold jurisdiction over the subject matter.[10] The above decision is a classic example of throwing the baby out with the bathwater. The judgment, is without an iota of doubt, a bad precedent in the current regime. The Court considered the principles of jurisdiction as established under Section 20 of the Code of Civil Procedure, 1908 (“CPC”) to hold that since a part of the cause of action arose within its territorial limits, the Calcutta High Court would have the appropriate jurisdiction. On the contrary, as per the authoritative judgments in BGS Soma and Indus Mobile as discussed above, the seat of arbitration clause would firstly prevail over the forum selection clause and secondly, the courts at the seat of arbitration would have supervisory jurisdiction over the arbitral process. Pertinently, the principle of the cause of action is wholly irrelevant whilst determining a tussle between an exclusive jurisdiction and forum selection clause in an arbitration case.[11] The ethos of the decision in BGS Soma was primarily aimed at giving supremacy to the seat of arbitration over the traditional CPC approach of deeming the cause of action to be the center of gravity. Therefore, the decision in the case of Bowlopedia Restaurants completely derails from the existing line of decisions and sets a bad precedent in law. The Calcutta High Court seems to have not only painted a bad stroke on the canvass but also picked the wrong brush in doing so. It is hoped that the decision is revisited by a Division Bench of the Calcutta High Court and the judgment of the learned single judge is set aside to keep at bay the ghosts of the past. THE THIRD STROKE A Division Bench of the Hon’ble Bombay High Court (“Bombay High Court”) in the case of Aniket SA Investments LLC v. Janapriya Engineers Syndicate Private Limited[12] (“Aniket Investments”) delivered a landmark judgment and held that a choice of seat is in itself an expression of party autonomy and carries the effect of conferring exclusive jurisdiction to the courts at the seat of arbitration. The judgment arose as a result of an appeal from the decision rendered by the learned single judge and under a Section 9 petition filed before the Bombay High Court. The arbitration agreement stipulated that the seat of arbitration would be Mumbai. However, the forum selection clause stipulated that ‘subject to’ the arbitration clause, the courts at Hyderabad shall have exclusive jurisdiction. The learned single judge, the forum selection clause took precedence over the seat of arbitration, and whilst dismissing the petition, held that the courts at Hyderabad will be forum conveniens. Aggrieved, the petitioner appealed to a Division Bench that set aside the order of the learned single judge. Relying on the Supreme Court’s decision in Bharat Aluminum Company v. Kaiser Aluminum Technical Services Inc.[13](“BALCO”) and BGS Soma and approving the reasoning adopted in Indus Mobile, the Division Bench ruled that once the parties have selected a seat of arbitration, it would carry with it a conferment of exclusive jurisdiction over the entire arbitral process. The Bombay High Court categorically noted that one of the most pertinent aspects of BGS Soma was its clarification of the judgment in BALCO. Interestingly, the Bombay High Court also noted[14] that BALCO was often misconstrued in the sense that two courts at different locations could exercise jurisdiction i.e., concurrent jurisdiction however, BGS Soma authoritatively clarified this point that neither did BALCO promote concurrent jurisdiction of the courts nor did it divide two different courts as the cause of action court and seat court.[15] In accordance with BGS Soma, the Bombay High Court ultimately opined that since Mumbai was fixed as the seat of arbitration and the forum selection clause only being ‘subject to’ the arbitration agreement, courts at Mumbai would hold precedence in jurisdiction over the Hyderabad courts. Thus, the judgment of the Bombay High Court is perhaps the most lucid and authoritative insofar as the debate at hand is concerned. Not only does the judgment reflect a stance friendly to party-autonomy, it also follows the correct law and disregards any misinterpretations. As discussed, due to the conflicting nature of the judgments rendered by the Delhi High Court and the Calcutta High Court, it is imperative that the judgment of the Bombay High Court is followed as the proper precedent. In sum, the Bombay High Court seems to have hand-picked the best brush and painted the best stroke on the canvas. CONCLUSION Despite the landmark Supreme Court judgments and given the three conflicting precedents of different High Courts in India, the conundrum remains far from being settled at the moment. On one hand, the courts must take note of the interpretations that must be consistently followed after BALCO and then BGS Soma. On the other hand, arguing the conundrum between exclusive jurisdiction and forum selection clauses may be a litigating lawyer’s delight, albeit the outcome of such decisions may yield a bad precedent, as observed in the case of Bowlopedia Restaurants. Post the BGS Soma judgment, it had become amply clear that there remained no room for concurrent jurisdiction being exercised by two different courts with different territorial limits. The regime had always been structured to provide the courts at the seat of the arbitration the exclusive jurisdiction over the arbitral process. However, what has gone around has certainly come around. In the meantime, it is vital that the judgment in Aniket Investments is treated as the most valuable precedent concerning the dichotomy between exclusive jurisdiction and forum selection clauses. It would be appropriate to end with an observation made by the Bombay High Court in the case of Aniket Investments: “It is too late in the day, to contend that the seat of arbitration is not analogous to an exclusive jurisdiction clause.”[16] * Rohan Gulati is a Junior Staff Editor for the Arbitration Workshop Blog. He is currently a fourth-year law student pursuing B.B.A. LL.B. at Symbiosis Law School, Hyderabad. His primary area of interest is Alternative Dispute Resolution (ADR) with a specific focus on arbitration law. He can be contacted at rohan.gulati@student.slsh.edu.in [1] BGS SGS Soma JV v. NHPC Ltd., (2020) 4 SCC 234. [2] Bharat Aluminium Company v. Kaiser Aluminium Technical Services Inc., (2012) 9 SCC 552. [3] 2021 SCC OnLine Del 1536. [4] (2020) 5 SCC 399. [5] Supra note 3 at ¶ 40. [6] Id, ¶ 42. [7] (2020) 4 SCC 234. [8] (2017) 7 SCC 678. [9] 2021 SCC OnLine Cal 103. [10] Supra note 9 at ¶ 36. [11] Supra note 1 at ¶ 49. [12] 2021 SCC OnLine Bom 919. [13] (2012) 9 SCC 552. [14] Supra note 12 at ¶ 24. [15] Supra note 1 at ¶ 57. [16] Reliance Industries Ltd. v. Union of India, (2014) 7 SCC 603 at ¶ 45.