Lawstreet Journal

Expression 'Existence Of Arbitration Agreement' In Section 11 of Arbitration Act Includes Aspect of Validity of Agreement : Supreme Court

Lawstreet Journal 18 Dec 2020 9:17pm

Image courtesy: Lawstreet Journal Judiciary Expression 'Existence Of Arbitration Agreement' In Section 11 of Arbitration Act Includes Aspect of Validity of Agreement : Supreme Court

The Supreme Court has held that the expression 'existence of arbitration agreement' in Section 11 of the Arbitration Act, 1996 would include the aspect of validity of arbitration agreement.

A three-judge bench of the Court also explained that at the stages of Sections 8 and 11 of the Act, the Courts should undertake a prima facie examination of the validity of the arbitration agreement.

Prima Facie examination under Section 8:

The Court noted that Section 8, after the 2016 amendment, enjoins the Court to undertake a prima facie examination as to the validity of the agreement.

The judgment of Justice Sanjiv Khanna explained the scope of prima facie examination as follows :Prima facie case in the context of Section 8 is not to be confused with the merits of the case put up by the parties which has to be established before the arbitral tribunal. It is restricted to the subject matter of the suit being prima facie arbitrable under a valid arbitration agreement.

'Existence of arbitration agreement' under Section 11

The judgment noted that sub-section 6A inserted in Section 11 as per 2016 amendment prescribed that the Court, at the stage of appointment of arbitrator, should confine itself to the examination of the existence of an arbitration agreement. This means that the 'existence of arbitration agreement' was meant to be a question to be decided at the stage of Section 11.

However, sub-section 6A was omitted after the 2019 amendment. But this omission was is in view of the introduction of a new regime of institutionalized… Continue Reading...

Tagged: Supreme Court of India  
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