Case Note & Summary
The dispute arose between the appellants and the respondent concerning an arbitration agreement. The respondent appointed an Arbitral Tribunal, allegedly with the appellants' consent, but the appellants objected, citing bias due to the Tribunal's links with the respondent. The Tribunal issued interim orders freezing the appellants' bank accounts and allowing the respondent to take possession of their properties. The appellants appealed to the High Court, which dismissed the appeal on grounds of limitation, as no application to condone the delay was filed. The Supreme Court, upon hearing arguments from both sides, determined that there was no evidence of consent for the Tribunal's appointment and that the interim orders were arbitrary. The Court set aside the High Court's order and the interim orders, directing the return of any amounts transferred to the respondent and restoring the appellants' properties. The Court appointed an Arbitrator to facilitate the resolution of disputes, leaving the merits of the case open for consideration. The appeal was disposed of with these directions.
Headnote
A) Arbitration Law - Appointment of Arbitral Tribunal - Validity of Appointment - Arbitration and Conciliation Act, 1996, Section 17 - The court found that the appointment of the Arbitral Tribunal lacked consent from the appellants and was arbitrary, leading to the conclusion that the initiation of arbitration was non est in law. The interim orders passed by the Tribunal were set aside, and directions were issued for the return of amounts transferred under those orders (Paras 3-6).
Issue of Consideration
Whether the appointment of the Arbitral Tribunal was valid and whether the interim orders passed by it were lawful.
Final Decision
The Supreme Court set aside the High Court's order and the interim orders of the Arbitral Tribunal, directing the return of amounts transferred and restoring the appellants' properties.
Law Points
- Arbitration
- Interim Orders
- Consent
- Bias
- Limitation
