Case Note & Summary
The Supreme Court considered a civil appeal arising out of a special leave petition against an order of the High Court of Delhi passed under Section 11 of the Arbitration and Conciliation Act, 1996 appointing a separate arbitrator for disputes under the T-Fiber Agreement. The appellant, M/s STL Networks Limited, and the respondent, Caspian India Engicon Pvt. Ltd., were parties to two distinct contracts for optical fiber cable services, namely the Mahanet Agreement and the T-Fiber Agreement. The respondent had initiated arbitration under the Mahanet Agreement before the High Court of Delhi, where Ms. Saumya Tandon was appointed as sole arbitrator on 16.09.2025. Subsequently, disputes arose under the T-Fiber Agreement as well, leading to a separate application under Section 11 before the same High Court, which appointed another arbitrator. The appellant contended that it had a material recovery claim under the T-Fiber Agreement, which was more than double the claim under the Mahanet Agreement, and that this claim was entitled to be exercised as a cross-project set-off against amounts payable under the Mahanet Agreement. The appellant sought modification of the impugned order to have the same arbitrator handle both arbitrations. The Supreme Court granted leave and observed that it would not go into the merits of the matter. However, in the fitness of things, the Court was of the opinion that the arbitration should be carried on by the very same arbitrator, namely the first appointed arbitrator. Accordingly, the Court directed that Ms. Saumya Tandon, appointed as sole arbitrator on 16.09.2025, shall be the arbitrator in the present dispute as well. The impugned order was modified to that extent. The Court clarified that it had not held on the merits of the cross-project set-off or the quantum of claims under the two separate agreements, and that the parties were entitled to raise all contentions before the arbitrator. The appeal was allowed and pending applications were rejected.
Headnote
A) Arbitration - Appointment of Arbitrator - Cross-Project Set-Off and Common Arbitrator - Arbitration and Conciliation Act, 1996, Section 11 - Dispute involved two contracts for optical fiber cable services, Mahanet Agreement and T-Fiber Agreement; separate arbitrations were initiated, with one arbitrator appointed on 16.09.2025 under Mahanet Agreement and another arbitrator appointed under the T-Fiber Agreement by the impugned High Court order. The appellant argued that a material recovery claim under the T-Fiber Agreement (more than double the claim under Mahanet) should be exercisable as cross-project set-off against amounts payable under Mahanet Agreement. The Supreme Court did not address merits but directed that the same first-appointed arbitrator, Ms. Saumya Tandon, shall act as arbitrator in the present dispute also, modifying the impugned order to that extent. Held that parties are entitled to raise all contentions including cross-project set-off and quantum before the arbitrator, and the Court expressed no opinion on merits (Paras 2-6).
Issue of Consideration
Whether the High Court's appointment of a different arbitrator under Section 11 of the Arbitration and Conciliation Act, 1996 for disputes arising under the T-Fiber Agreement should be modified to appoint the same arbitrator already appointed under the Mahanet Agreement, considering a cross-project set-off claim.
Final Decision
The Supreme Court granted leave, modified the impugned High Court order to the extent that the same arbitrator, Ms. Saumya Tandon (appointed on 16.09.2025 under the Mahanet Agreement), shall act as arbitrator in the T-Fiber Agreement dispute as well. The Court clarified that it did not decide the merits of the cross-project set-off or quantum of claims, and parties were entitled to raise all contentions before the arbitrator. Appeal allowed; pending applications rejected.
Law Points
- Arbitration and Conciliation Act
- 1996 Section 11
- appointment of arbitrator
- common arbitrator for related contracts
- cross-project set-off
- first appointed arbitrator
- modification of High Court order
- no opinion on merits
