Content Provider | Supreme Court of India |
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e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | Sections 3 1940 8 33 Arbitration Act 34 |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Petition Disposed Off |
Headnote | Arbitration Act, 1940; Sections 3, 8, 33, 34, 37(3)/Arbitration and Conciliation Act, 1996; Sections 21, 43 (1) & (2) and 85/Limitation Act, 1963Agreement between the Supplier and the Manufacturer-Arbitration Clause-Dispute-Suit for permanent injunction filed by the manufacturer-Application for stay of suit filed by the supplier-Allowing the application, trial Court stayed the suit directing to refer the dispute to Arbitrator-Appeal dismissed by first appellate Court-On revision, High Court referred the dispute to Arbitral Tribunal-Arbitration proceedings initiated by Tribunal as per provisions of 1996 Act-Challenged by the supplier on ground that 1940 Act was applicable-Rejected by the Tribunal holding that 1996 Act was rightly applied-High Court holding that since the disputes were referred to arbitration when new Act already came into force and both the parties gave clear consent to refer the matter to Arbitrator, new Act could be applied. Held Per majority:Commencement of arbitration proceeding depends upon terms of the agreement/various factors/purposes it seeks lo achieve-Issuance of notice is necessary under both the Acts for invoking provision of law for arbitration of dispute-Notice has to be interpreted broadly-A Notice of Arbitration is the first essential step towards making of appointment of Arbitrator/Arbitrators-Their appointment by the Court not mandatory-Service of Notice by one party to another for appointment of an Arbitrator indicative of deemed commencement of arbitration proceeding/or the purpose of/imitation-Hence, notice for appointment of an Arbitrator/Arbitrators would be relevant for determining commencement of the arbitration proceeding-However, change in constitution of the arbitral Tribunal irrelevant-Repealing provisions under the 1996 Act makes 1940 Act applicable in respect of the arbitral proceeding commenced before the new Act came into force-Since arbitral proceedings already commenced, procedure laid down under the old Act would be applicable-However since the proceeding before the Arbitrators not stayed and they had entered into the reference, proceedings need not be re-opened--Arbitrators may proceed to give award-Parties may proceed in terms of the old Act after filing of the Award in the Court.Arbitration agreement-Invoking of-It may be invoked by a party to a dispute not exclusively by claimant. Commencement of an arbitration proceeding-Meaning of-Section 21 must be read with Section 85(2)(a) of the New Act to construe its meaning-construing so service of notice for appointment of Arbitrator/Arbitrators determines the commencement of arbitral proceeding. Words and Phrases: 'Commencement of an arbitration proceeding' and 'Commencement of proceeding before an Arbitrator-Distinction between-Discussed. Held: Per minority:Construction of transitional provisions under Section 85(2)(a) of the new Act must depend upon its own terms-Not to be construed on the basis of provision under Section 21 of the Act-Notice to concur is an essential step-However, date of constitution of arbitral tribunal and charging them with authority would determine commencement of arbitral proceedings-Since for all practical purposes arbitration proceeding commenced when the 1996 Act came into force, the proceedings would be governed by the provisions of the 1996 Act. Words and Phrases:'Reference' as under Section 48 of the 1940 Act, vis-a-vis 'commencement' as per Section 85(2)(a) of 1996 Act-Meaning of in the context of Section 21 of the 1996 Act-Discussed. |
Judge | Hon'ble Mr. Justice S.B. Sinha |
Neutral Citation | 2004 INSC 232 |
Petitioner | Milk Food Ltd. |
Respondent | M/s. Gmc Ice Cream (p) Ltd |
SCR | [2004] 3 S.C.R. 854 |
Judgement Date | 2004-04-05 |
Case Number | 9672 |
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