1. Appeal against High Court order appointing an arbitrator under Section 11, Arbitration and Conciliation Act, 1996, which excluded certain claims as non-arbitrable. (Para 2 )
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2025 Supreme(SC) 807
SUPREME COURT OF INDIA
Pamidighantam Sri Narasimha, Manoj Misra, JJ.
Office for Alternative Architecture – Appellant
Versus
Ircon Infrastructure and Services Ltd. – Respondent
Civil Appeal No. 6620 of 2025 (Arising out of SLP (C) No. 28104 of 2023)
Decided On : 13-05-2025
Advocates appeared:
For the Petitioner(s): Mr. Talwant Singh, Sr. Adv. Mr. B.S. Jakhar, Adv. Mr. Vikram Singh Jakhar, Adv. Ms. Bhawna Jakhar, Adv. Mr. Neeraj Jakhar, Adv. Mr. Viraj Rathee, Adv. Ms. Anshu Devar, Adv. Mr. Nihar Dagar, Adv. Ms. Shruti Datta, Adv. Ms. Varnika Sharma, Adv. Mr. Vishul Dabas, Adv. Mr. Sparsh Karnwal, Adv. Mr. Sriram P., AOR
For the Respondent(s): M/S. Kmnp Law, AOR Mr. Abir Phukan, Adv. Mr. V. Shyamohan, Adv. Ms. Rishika Radhakrishnan, Adv.
For the Petitioner(s): Mr. Talwant Singh, Sr. Adv. Mr. B.S. Jakhar, Adv. Mr. Vikram Singh Jakhar, Adv. Ms. Bhawna Jakhar, Adv. Mr. Neeraj Jakhar, Adv. Mr. Viraj Rathee, Adv. Ms. Anshu Devar, Adv. Mr. Nihar Dagar, Adv. Ms. Shruti Datta, Adv. Ms. Varnika Sharma, Adv. Mr. Vishul Dabas, Adv. Mr. Sparsh Karnwal, Adv. Mr. Sriram P., AOR
For the Respondent(s): M/S. Kmnp Law, AOR Mr. Abir Phukan, Adv. Mr. V. Shyamohan, Adv. Ms. Rishika Radhakrishnan, Adv.
The Supreme Court ruled that during the appointment of an arbitrator under Section 11 of the Arbitration Act, the court should only assess the existence of an arbitration agreement and refrain from addressing claim arbitrability.
Headnote:(A) Arbitration and Conciliation Act, 1996 - Section 11 - Appointment of arbitrators - The High Court excluded certain claims from arbitration, claiming them to be non-arbitrable based on agreement clauses - The Supreme Court found this to be in error, emphasizing that the existence of an arbitration agreement should be the sole consideration, not the merits of claims at this stage (Paras 6, 12).
(B) Jurisdiction of courts - The Supreme Court clarified that the role of appointing an arbitrator under Section 11 is limited to examining the existence of a prima facie arbitration agreement and not to question the claims themselves (Paras 10, 11).
(C) Non-arbitrability - The court ruled that issues of non-arbitrability should be left for determination by the arbitral tribunal rather than excluded by the court at the appointment stage (Paras 12, 13).
Facts of the case:
The appellant sought to challenge the High Court's decision to exclude certain claims from arbitration under Section 11 of the 1996 Act. The appellant argued for the appointment of an arbitrator to consider all claims.
Findings of Court:
The Supreme Court held that the High Court erred in prejudging claims as non-arbitrable. The exclusion of claims was set aside, allowing them to be evaluated by the arbitral tribunal.
Issues: The main issues pertained to whether the High Court's exclusion of claims was justified given the existing arbitration agreement.
Ratio Decidendi: The court concluded that only the existence of an arbitration agreement should guide the appointment of the arbitrator, restricting the court's review to that aspect (Paras 6, 11).
Result: Appeal allowed; High Court's exclusion of claims set aside.
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Table of Contents
2. Whether the referral court under Section 11 should only examine the existence of the arbitration agreement or can exclude non-arbitrable claims. (Para 3 , 4 )
3. Section 11(6A) mandates that courts confine examination to the existence of the arbitration agreement, excluding other issues including the arbitrability of specific claims. (Para 7 , 8 , 9 , 10 , 11 )
4. At the Section 11 appointment stage, the court's jurisdiction is limited to the prima facie existence of the arbitration agreement and not other issues. (Para 7 , 11 , 12 )
5. Appeal allowed; High Court order excluding specific claims set aside; parties permitted to raise non-arbitrability pleas before the arbitral tribunal. (Para 13 )
6. What is the scope of judicial examination during the appointment of an arbitrator under Section 11 of the Arbitration and Conciliation Act, 1996?
The court must confine its examination to the prima facie existence of the arbitration agreement and not consider other issues, including the arbitrability of specific claims. (Para 7 , 9 , 11 )
7. Does the court have the power to exclude non-arbitrable or excepted claims while exercising jurisdiction under Section 11?
No, the court should not bisect claims into arbitrable and non-arbitrable categories; such issues should be left for the arbitral tribunal to decide. (Para 12 )
8. What is the current legal status of Section 11(6A) of the Arbitration and Conciliation Act, 1996?
Although Act 33 of 2019 omitted sub-section (6A), the amending Act has not been notified, meaning sub-section (6A) remains in the statute book. (Para 8 )
JUDGMENT :
MANOJ MISRA, J.
1. Leave granted.
2. This appeal impugns the judgment and order of the High Court of Delhi at New Delhi1[The High Court] dated 06.09.2023 whereby, while appointing an arbitral tribunal in exercise of power under Section 11 2[11. Appointment of arbitrators.
(1) A person of any nationality may be an arbitrator, unless otherwise agreed by the parties.
(2) Subject to sub-section (6), the parties are free to agree on a procedure for appointing the arbitrator or arbitrators.
(3) Failing any agreement referred to in sub-section (2), in an arbitration with three arbitrators, each party shall appoint one arbitrator, and the two appointed arbitrators shall appoint the third arbitrator who shall act as the presiding arbitrator.
(3A) [The Supreme Court and the High Court shall have the power to designate, arbitral institutions, from time to time, which have been graded by the Council under section 43-I, for the purposes of this Act:
Provided that in respect of those High Court jurisdictions, where no graded arbitral institution are available, then, the Chief Justice of the concerned High Court may maintain a panel of arbitrators for discharging the functions and duties of arbitral institution and any reference to the arbitrator shall be deemed to be an arbitral institution for the purposes of this section and the arbitrator appointed by a party shall be entitled to such fee at the rate as specified in the Fourth Schedule. Provided further that the Chief Justice of the concerned High Court may, from time to time, review the panel of arbitrators.]
(4) If the appointment procedure in sub-section (3) applies and (a) a party fails to appoint an arbitrator within thirty days from the receipt of a request to do so from the other party; or (b) the two appointed arbitrators fail to agree on the third arbitrator within thirty days from the date of their appointment, [the appointment shall be made, on an application of the party, by the arbitral institution designated by the Supreme Court, in case of international commercial arbitration, or by the High Court, in case of arbitrations other than international commercial arbitration, as the case may be].
(5) Failing any agreement referred to in sub-section (2), in an arbitration with a sole arbitrator, if the parties fail to agree on the arbitrator within thirty days from receipt of a request by one party from the other party to so agree [the appointment shall be made on an application of the party in accordance with the provisions contained in sub-section (4).]
(6) Where, under an appointment procedure agreed upon by the parties,- (a) a party fails to act as required under that procedure; or (b) the parties, or the two appointed arbitrators, fail to reach an agreement expected of them under that procedure; or (c) a person, including an institution, fails to perform any function entrusted to him or it under that procedure, [the appointment shall be made, on an application of the party, by the arbitral institution designated by the Supreme Court, in case of international commercial arbitration, or by the High Court, in case of arbitrations other than international commercial arbitration, as the case may be] to take the necessary measure, unless the agreement on the appointment procedure provides other means for securing the appointment.
(6A) The Supreme Court or, as the case may be, the High Court, while considering any application under sub-section (4) or sub-section (5) or sub-section (6), shall, notwithstanding any judgment, decree or order of any Court, confine to the examination of the existence of an arbitration agreement.
(6B) The designation of any person or institution by the Supreme Court or, as the case may be, the High Court, for the purposes of this section shall not be regarded as a delegation of judicial power by the Supreme Court or the High Court.
(7) Decision on a matter entrusted by sub-section (4) or sub-section (5) or sub-section (6) to the Supreme Court or, as the cas
