Following in the footsteps of the Hon`ble Supreme Court of India, the Bombay High Court and the Calcutta High Court have asserted that the first part of the law will not apply to overseas-based arbitration proceedings. Arbitration in India is subject to the provisions of the Arbitration Act 1996 (the “Act”). The law provides that an arbitration agreement may exist in respect of some or all disputes that have arisen or may arise concerning a defined legal relationship, whether contractual or not. The law also provides that an arbitration agreement may have the character of an arbitration clause in a separate contract or agreement between these parties. Although the present case was governed by the amended Law of 1996, the Court referred to the first entry in the fifth list inserted by the Amending Law of 2015, which is worded as follows: 8. (1) In this Part, the term “arbitration agreement” means an agreement between the parties, all or certain disputes that have or may arise between them in a defined legal relationship, whether by contract or not, subject to arbitration proceedings. “To dissuade a party to an arbitration from invoking this alternative dispute resolution procedure through an advance payment of 10% would discourage arbitration, contrary to the objective of unclogging the court system and would make arbitration inefficient and costly. 2. An arbitration agreement may take the form of an arbitration clause in a contract or in the form of a separate agreement. Since the decision in SBP v Patel Engineering AIR 2006 SC 450, the Tribunal has had the power to rule provisionally on its own jurisdiction to rule on the application for arbitration and on the existence of a direct claim, i.e. one that is not affected by the limitation period. The different categories of issues within the jurisdiction and competence of the Court, while exercising jurisdiction under Section 11, were decided by the Supreme Court (SC) in Nationale Insurance Company Limited against Boghara Polyfab Private Limited (2009) 1 SCC 267 concerning (i) the matters to be decided by the Supreme Judge or his agent; decisions relating to jurisdiction and the existence of an arbitration agreement in force; (ii) matters on which it may also rule, i.e.: whether the claims invoked by the parties are valid and (iii) questions that should be left to the arbitral tribunal.
An arbitration agreement is entered into by two persons who enter into a contract that seeks to settle all disputes that arise between them with respect to the contractual agreement, without being judged and settled with the assistance of an arbitrator. The agreement should indicate who is to choose the arbitrator, the type of dispute the arbitrator is to take, the place of arbitration, etc. The arbitral award in this case was filed on 13.10.2015 and the article 34 petitions on 04.01.2016. The judgment analysed the language of series No. 26 of the amending law and deciphered the words “arbitration” and “with regard to arbitration proceedings”. 9. It is therefore clear from the interpretation of Section 8 that the role of the judicial authority in referring the parties to arbitration proceedings arises only when a claim is made by a party to the arbitration agreement or by a person who asserts his claim under or by him. . . .