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TMI Blog2023 (5) TMI 510X X X X Extracts X X X X X X X X Extracts X X X X ..... he parties to the agreement and the applicant s privity to the said agreement - The Secondary inquiry that may arise at the reference stage itself is with respect to the non-arbitrability of the dispute. Both are different and distinct. So far as the first issue with respect to the existence and the validity of an arbitration agreement is concerned, as the same goes to the root of the matter, the same has to be to conclusively decided by the referral court at the referral stage itself. If the dispute/issue with respect to the existence and validity of an arbitration agreement is not conclusively and finally decided by the referral court while exercising the pre-referral jurisdiction under Section 11(6) and it is left to the arbitral tribunal, it will be contrary to Section 11(6A) of the Arbitration Act. It is the duty of the referral court to decide the said issue first conclusively to protect the parties from being forced to arbitrate when there does not exist any arbitration agreement and/or when there is no valid arbitration agreement at all. The impugned common judgment and order passed by the High Court in respective Arbitration Petitions, referring the disputes to arbitration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... endment Act, 2015 by which sub-section (6A) has been added to Section 11 of the Arbitration Act, while deciding the application under Section 11(6) of the Act and while exercising the prereferral jurisdiction, the Court has to consider and examine the existence of an arbitration agreement and it should not be left to the Arbitral Tribunal. 3.2 It is vehemently submitted that there is a difference and distinction between the existence and validity of an arbitration clause and non-arbitrability of the dispute. It is submitted that so far as the issue with respect to the existence and validity of an arbitration agreement at the stage of prereferral jurisdiction under Section 11(6) of the Act, the Court has to give a specific finding finally on such issue and such an issue should not be left to the Arbitral Tribunal. It is submitted that therefore, the High Court has misapplied and/or misread the decision of this Court in the case of Vidya Drolia (supra). 3.3 It is vehemently submitted by Shri Kapur, learned Senior Advocate appearing on behalf of the appellant that as such it is the duty cast upon the referral court to protect the parties from being forced to arbitrate when the matter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -2 do contain the arbitration clause, more particularly, clause 27.3 in SHA-1. It is submitted that the High Court in paragraph 22 has specifically observed and opined that the four agreements are indisputably interconnected. It is submitted that once there is a specific finding given that all the agreements are interconnected, the agreement in which there is an arbitration clause has to be read along with MOU-2 and therefore, the High Court has rightly referred the disputes to the arbitration. 4.2 Shri Kaul, learned Senior Advocate appearing on behalf of the original applicant has heavily relied upon the decision of this Court in the case of Chloro Controls India Private Limited Vs. Severn Trent Water Purification Inc. and Ors., (2013) 1 SCC 641 as well as the decision of this Court in the case of Olympus Superstructures (P) Ltd. Vs. Meena Vijay Khetan, (1999) 5 SCC 651 in support of his submission that all the four agreements are interconnected and therefore, are required to be read altogether. 5. Heard. The short question which is posed for the consideration of this Court is, the jurisdiction of the referral court at pre-referral stage when the issue with respect to the existenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... missal is barefaced and pellucid and when on the facts and law the litigation must stop at the first stage. However, so far as the dispute with respect to the existence and validity of an arbitration agreement is concerned and when the same is raised at pre-referral stage, the referral court has to decide the said issue conclusively and finally and should not leave the said issue to be determined by the arbitral tribunal. The reason is that the issue with respect to the existence and validity of an arbitration agreement goes to the root of the matter. As observed by the Constitution Bench in the case of N.N. Global Mercantile Pvt. Ltd. (supra) Sans an agreement, there cannot be any reference to the arbitration. In the said decision this Court has also specifically observed and held that the intention behind the insertion of Section 11(6A) in the Act was to confine the Court, acting under Section 11, to examine and ascertain about the existence of an arbitration agreement. We are of the opinion that therefore, if the dispute/issue with respect to the existence and validity of an arbitration agreement is not conclusively and finally decided by the referral court while exercising the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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