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Anti Arbitration Injunction

(i) Arbitration - Anti-arbitration injunction against a foreign seated arbitration  - Power and jurisdiction - Under what circumstances can it be so granted? - Courts in India do have the power to grant anti-arbitration injunctions -  However, this power is to be used sparingly and with abundant caution (Devi Resources Ltd. v. Ambo Exports Ltd., 13.02.2019  (Cal.)) - It is only under the circumstances enumerated in and exhaustively discussed in Modi Entertainment Network  v. W.S.G. Cricket, (2003) 4 SCC 341, (para 24) which would merit the grant of an anti-arbitration in-junction and therefore, its rare and controlled usage. #2020 SCeJ 1783 (Cal.) 

 

 

(ii) Anti-arbitration injunction against a foreign seated arbitration  - Power and jurisdiction - The mere possibility that “multiplicity of proceedings” may arise, is not a ground in itself for the grant of an anti-arbitration injunction against the respondent, if such ground is not coupled with the plea of either forum non-conveniens or vexatious or oppressive proceedings launched before such a neu-tral foreign forum. World Sport Group (Mauritius) Limited  v. MSM Satellite (Singapore) P. Ltd., (2014) 11 SCC 639, re-lied - Burden of proof to show that the arbitration clause in the Agreement has become inoperative or incapable of being performed is on the party asserting the same - The burden of proof to show that there exist forum non-conveniens or proceedings launched before a neutral foreign forum is vexatious or oppressive is also upon the party asserting the same -  The mere existence of multiple proceed-ings and/or chance of a matter proceeding in multiple forums are not sufficient reasons to render an arbitration agreement inoperative - The fact that the pricing mechanism in the Agreement has been incorporated into the purchase orders does not by itself make the arbitration clause in the Agreement inoperative - The Agreement being in the nature of an umbrella agreement subsists and the arbitration clause therein continues to operate on all aspects of the agreement – If the parties have agreed to the Agreement and the purchase orders with their eyes open, and if multiple proceedings may arise due to certain ambiguities, so be it - That fact alone cannot make one of the proceedings, especially a neutral foreign seated arbitration applying a neutral gov-erning and proper law, a vexatious or op-pressive proceeding – Parties acquies-cence to a sole arbitrator is one of the factors to be examined by the Court while granting an ad interim injunction. #2020 SCeJ 1783 (Cal.)  

 

(iii) Arbitration - Where a contract between the parties provides that the exe-ution or performance of that contract shall be in terms of another contract (which contains the terms and conditions relating to performance and a provision for settlement of disputes by arbitration), then, the terms of the referred contract in regard to execution/ performance alone will apply, and not the arbitration agreement in the referred contract, unless there is a special reference to the arbitration clause also. #2020 SCeJ 1783 (Cal.)