Case Note & Summary
The dispute arose from an agreement between the appellant and the respondents for construction work at the Air Force Academy, Hyderabad, dated 22.07.2010. The appellant raised a revised final bill on 10.07.2012, and payment was made on 29.04.2013, after which the appellant issued a 'no further claim' certificate. Subsequently, the appellant invoked the arbitration clause on 20.12.2013 and filed an application under Section 11(6) of the Arbitration and Conciliation Act, 1996 on 27.04.2016, seeking the appointment of an arbitrator. The High Court dismissed the application, ruling that the appellant had accepted full payment and issued a no further claim certificate, thus establishing accord and satisfaction. The appellant contended that the Amendment Act, 2015, which introduced Section 11(6A), limited the court's inquiry to the existence of an arbitration agreement, and should apply to their case. The respondents argued that since the notice invoking arbitration was issued before the Amendment Act came into force, the pre-amendment provisions applied. The Supreme Court analyzed the applicability of the Amendment Act, 2015, particularly Section 26, which states that the Act does not apply to arbitral proceedings commenced before its enactment unless the parties agree otherwise. The Court concluded that the Amendment Act is prospective and does not apply to the current case, as the arbitration proceedings were initiated prior to its enactment. The appeal was thus dismissed, affirming the High Court's decision.
Headnote
A) Arbitration Law - Applicability of Amendment Act - Prospective Nature of Amendment Act, 2015 - Arbitration and Conciliation Act, 1996, Sections 11, 26 - The court held that the Amendment Act, 2015 is prospective and applies only to arbitral proceedings commenced after its enactment, thus the pre-amendment provisions governed the case at hand (Paras 1-29).
Issue of Consideration
Whether the Amendment Act, 2015 applies to arbitration proceedings where the notice invoking arbitration was issued prior to its enactment.
Final Decision
The Supreme Court dismissed the appeal, affirming the High Court's decision that the Amendment Act, 2015 does not apply to the arbitration proceedings initiated prior to its enactment.
Law Points
- Arbitration
- Accord and Satisfaction
- Amendment Act
- 2015
- Section 11
- Section 26
- Judicial Proceedings
- Prospective Applicability
