Volume 30 (2013) / Issue 6
Kartikey Mahajan, Malak Bhatt, 'Reference of Non-Signatories to Arbitration in Composite Transactions: Did the Indian Supreme Court Get it Right?' (2013) 30 Journal of International Arbitration, Issue 6, pp. 711–726
In Chloro Controls India Pvt. Ltd. v. Severn Trent Water Purification Inc. and others, the Indian Supreme Court ruled that non-signatories to arbitration agreements for foreign arbitrations can be referred to arbitration especially in the cases of composite transactions. This is possible when a non-signatory is claiming through a party to the arbitration agreement. Although this is another step towards the development of a pro-arbitration jurisprudence in India following the ruling in Bharat Aluminium Co. v. Kaiser Aluminium, the judgment raises many concerns, such as causing long delays in the conclusion of arbitral proceedings and creating uncertainty as to the nature of the proceedings under section 45 reference applications. This article critically examines the ruling, identifies the relevant law, and explains the limits of its application.
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