Key cases on arbitration signal progress in India

The Supreme Court’s landmark decision in Bharat Aluminium Co v Kaiser Aluminium Technical Services in September shows that India is seeking to be seen as serious and lucrative jurisdiction for international commercial arbitration. The court has taken a further step in this direction by its decision in Chloro Controls (I) P Ltd v Severn Trent Water Purification, which lays to rest various issues relating to section 45 of the act.

Brief facts

A joint venture agreement (JVA) was executed between Capital Controls (Delaware) Co, Chloro Controls India and a director of Chloro Controls India. The JVA envisaged several supplementary agreements to be executed between Chloro Controls India and Severn Trent Group (of which Capital Controls was a part). While the JVA contained an arbitration clause, some of the supplementary agreements lacked one.

Subsequent disputes resulted in the termination of the JVA and the supplementary agreements. Chloro Controls filed a suit before Bombay High Court for a declaration that the JVA was valid and subsisting. Severn Trent filed a motion claiming that the arbitration clause in some of the agreements governed all of them and seeking a reference to arbitration and a stay in the suit. The motion was dismissed by a single judge.

Trisha Mitra is an integral part of the litigation team at Bharucha & Partners.