2020 (4) TMI 831 - SC - Indian Laws

Arbitration application - adjudication of dispute between the parties - permanent injunction restraining the appellant from relying on the arbitration clauses contained in the agreements - HELD THAT - In the present case the arbitration in question is a domestic and an institutional arbitration where CIAA was empowered to and did nominate the Arbitrator. It is not as if there were completely different mechanisms for appointment of Arbitrator in each of the agreements. The only distinction is that according to one of the agreements the venue was to be at Kolkata. The specification of place of arbitration may have special significance in an International Commercial Arbitration, where the place of arbitration may determine which curial law would apply. However, in the present case, the applicable substantive as well as curial law would be the same. It was possible for the respondent to raise submissions that arbitration pertaining to each of the agreements be considered and dealt with separately. It was also possible for him to contend that in respect of the agreement where the venue was agreed to be at Kolkata, the arbitration proceedings be conducted accordingly. Considering the facts that the respondent failed to participate in the proceedings before the Arbitrator and did not raise any submission that the Arbitrator did not have jurisdiction or that he was exceeding the scope of his authority, the respondent must be deemed to have waived all such objections. The High Court was in error in setting aside said Order. In any case, the fact that the cause title showed that the present appellant was otherwise amenable to the jurisdiction of the Alipore Court, could not be the decisive or determining criteria - Appeal allowed.

Summary

Issues Involved:
1. Existence and validity of arbitration agreements.
2. Jurisdiction of the arbitration proceedings.
3. Waiver of the right to object by the respondent.
4. Validity of the arbitral award and its enforcement.

Detailed Analysis:

1. Existence and Validity of Arbitration Agreements:
The respondent company, engaged in infrastructure development, entered into multiple agreements with the claimant company for renting construction equipment. Each agreement contained an arbitration clause specifying different venues for arbitration. The respondent later denied the existence of these agreements, leading to a legal dispute.

2. Jurisdiction of the Arbitration Proceedings:
The agreements specified different venues for arbitration. The agreement dated 01.08.2010 specified New Delhi, while the agreement dated 14.04.2011 specified Kolkata. The claimant initiated arbitration proceedings in New Delhi, which the respondent contested, arguing that the venue should be Kolkata as per one of the agreements.

3. Waiver of the Right to Object by the Respondent:
The respondent did not participate in the arbitration proceedings and failed to raise any objections regarding the jurisdiction or the arbitrator's authority during the arbitration. The Supreme Court noted that under Sections 4 and 16 of the Arbitration and Conciliation Act, 1996, the respondent's failure to object in a timely manner constituted a waiver of their right to raise such objections later.

4. Validity of the Arbitral Award and Its Enforcement:
The arbitrator issued an ex-parte award in favor of the claimant, covering all four agreements, and awarded the claimant a sum of ?78,78,533 along with interest and costs. The respondent challenged the award under Section 34 of the Act, arguing jurisdictional issues. The Court at Alipore dismissed the petition, stating that the arbitration proceedings were validly conducted in New Delhi as per the agreements.

Separate Judgments:
The Supreme Court upheld the decision of the Court at Alipore, emphasizing that the respondent had waived their right to object to the arbitration venue by not raising timely objections. The Court also clarified that the cause title indicating the appellant's amenability to the jurisdiction of the Alipore Court was not a decisive factor.

Conclusion:
The Supreme Court allowed the appeal, set aside the judgment of the High Court at Calcutta, and restored the order of the Court at Alipore, thereby validating the arbitral award and the proceedings conducted in New Delhi. The respondent's failure to object timely was deemed a waiver of their right to contest the jurisdiction of the arbitration.