03 October 2018
Supreme Court
Download

M/S LARSEN AND TOUBRO LIMITED SCOMI ENGINEERING BHD Vs MUMBAI METROPOLITIAN REGION DEVELOPMENT AUTHORITY

Bench: HON'BLE MR. JUSTICE ROHINTON FALI NARIMAN, HON'BLE MR. JUSTICE NAVIN SINHA
Judgment by: HON'BLE MR. JUSTICE ROHINTON FALI NARIMAN
Case number: ARBIT.CASE(C) No.-000028 / 2017
Diary number: 13248 / 2017
Advocates: GAUTAM TALUKDAR Vs


1

1

REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL ORIGINAL JURISDICTION

ARBITRATION PETITION  (C) No. 28 OF 2017

 M/S LARSEN AND TOUBRO LIMITED SCOMI ENGINEERING BHD                  …PETITIONER

VERSUS

MUMBAI METROPOLITAN REGION  DEVELOPMENT AUTHORITY                  ...RESPONDENT

J U D G M E N T  

R.F. Nariman, J.

1) The present petition, under Section 11 of the Arbitration

& Conciliation Act, 1996, (in short ‘the Act’), that has been filed

before  this  Court,  arises  out  of  a  contract  entered  into  on

09.01.2009  for  the  work  of  planning,  design,  development,

construction, manufacture, supply, testing and commissioning of

a  Monorail  system  in  two  particular  earmarked  sections  in

Wadala,  Mumbai  including  operation  and  maintenance  for  a

period  of  three  years  from  the  date  of  start  of  commercial

operations.   This  agreement  contains  an  arbitration  clause,

which is set out hereunder:-

2

2

“Claims, Disputes and Arbitration

20.1 Contractor’s Claim

If the Contractor considers himself to be entitled to any extension

of the Time for Completion and/or any additional payment, under

any Clause of these Conditions for otherwise in connection with

the  Contract,  the  Contractor  shall  give  notice  to  the

Employer/Employer’s  Representative,  describing  the  event  or

circumstance giving rise to the claim.  The notice shall be given

as  soon  as  practicable,  and  not  later  than  30  days  after  the

Contractor became aware, or should have become aware, of the

event or circumstance.

If the Contractor fails to give notice of a claim within such period

of 30 days, the Time for Completion shall not be extended, the

Contractor shall  not be entitled to additional  payment, and the

Employer/Employer’s Representative shall be discharged from all

liability  in  connection with the claim.   Otherwise,  the following

provisions of this Sub-Clause shall apply.

The Contractor  shall  also submit  any  other  notices which  are

required by the Contract, and supporting particulars for the claim,

all as relevant to such event or circumstance.

The Contractor shall keep such contemporary records as may be

necessary  to  substantiate  any  claim,  either  on  the  Site  or  at

another  location  acceptable  to  the  Employer/Employer’s

Representative.  Without  admitting  liability,  the

Employer/Employer’s  Representative  may,  after  receiving  any

notice under this Sub-Clause, monitor the record-keeping and/or

instruct  the  Contractor  to  keep  further  contemporary  records.

The  Contractor  shall  permit  the  Employer/Employer’s

Representative  to  inspect  all  these  records,  and  shall  (if

3

3

instructed)  submit  copies  to  the  Employer/Employer’s

Representative.

Within 45 days after  the Contractor  became aware (or  should

have become aware) of the event or circumstances giving rise to

the claim, or within such other period as may be proposed by the

Contractor  and  approved  by  the  Employer/Employer’s

Representative,  the  contractor  shall  send  to  the

Employer/Employer’s Representative a fully detailed claim which

includes full supporting particulars of the basis of the claim and of

the extension of time and/or additional payment claimed.  If the

event or circumstance giving rise to the claim has a continuing

effect:

(a)  this fully detailed claim shall be considered as interim;

(b)  the Contractor shall send further interim claims at monthly

intervals, giving the accumulated delay and/or amount claimed,

and such  further  particulars  as  the  Employer  may reasonably

require; and

(c)  the Contractor shall send a final claim within 30 days after

the end of the effects resulting from the event or circumstance, or

within such other period as may be proposed by the Contractor

and approved by the Employer/Employer’s Representative.

Within 45 days after receiving a claim or any further particulars

supporting a previous claim, or within such other period as may

be  proposed  by  the  Employer/Employer’s  Representative  and

approved  by  the  Contractor,  the  employer  shall  respond  with

approval, or with disapproval and detailed comments.  He may

also  request  any  necessary  further  particulars,  but  shall

4

4

nevertheless  give  his  response  on  the  principles  of  the  claim

within such time.

Each interim payment shall include such amounts for any claim

as  have  been  reasonable  substantiated  as  due  under  the

relevant provision of the Contract, unless and until the particulars

supplied are sufficient to substantiate the whole of the claim, the

Contractor shall only be entitled to payment for such part of the

claim as he has been able to substantiate.

The  Employer/Employer’s  Representative  shall  proceed  in

accordance  with  Sub-Clause  3.5  (Determination)  to  agree  or

determine (i)  the extension (if  any) of  the Time for  completion

(before or  after  its  expiry)  in  accordance with  Sub-Clause 8.4

[Extension of Time for Completion], and/or

(ii)  the  additional  payment  (if  any)  to  which  the  Contractor  is

entitled under the Contract.  The requirements of this Sub-Clause

are  in  addition  to  those  of  any  other  Sub-Clause,  which  may

apply to a claim.  If  the Contractor fails to comply with this or

another  Sub-Clause in  relation to any claim,  any extension of

time and/or additional payment shall take account of the extent (if

any)  to  which  the  failure  has  prevented  or  prejudiced  proper

investigation of the claim, unless the claim is excluded under the

second paragraph of this Sub-Clause.

20.2  

Dispute  to  be referred to and settled  by Employer’s Representative

Should any dispute or difference of any kind whatsoever arise

between the Employer and the Contractor, in connection with, or

arising  out  of  the  Contract,  or  subject  matter  thereof,  or  the

execution of Works/commissioning of the  System/Operation &

Maintenance  of  the  System,  whether,  during  the  progress  of

5

5

at Site Works/during Operation and Maintenance of the System or after

their  completion  and  whether  before  or  after  termination,

abandonment or breach of Contract, it should, in the first place,

subject  to  the  provision  under  Sub-clause  14.4  above,  be

referred to and settled by the Employer’s Representative at Site,

who shall,  within a period of 60 days after being requested in

writing by either party to do so, give written notice of his decision

to  the  Employer  and  the  Contractor.  The  Employer’s

Representative at Site while considering the matters of dispute

referred  to  him,  shall  be  competent  to  call  for  any  records,

vouchers, information and enforce the attendance of the parties

either in person or through authorised representatives, to sort out

or clarify any issue, resolve the differences and to assist him to

decide the matters  referred to  him.   Subject  to  arbitration,  as

hereinafter provided, such decision in respect of every matter so

referred shall be final and binding   upon the Employer and the

Contractor,  who  shall  proceed  with  the  execution  of  Works/

commissioning of  the System/Operation & Maintenance of  the

System (as the case may be) with all due diligence irrespective

of  whether  any  of  the  parties  goes  in  or  desires  to  go  in  for

arbitration.  If  the Employer’s Representative at Site has given

written notice of his decision to the Employer and the Contractor

and no  intimation  of  reference  of  any  claim to  arbitration has

been sent to him by either the Employer or the Contractor within

a period of 60 days from receipt of such notice, the said decision

of the Employer’s Representative shall remain final and binding

upon the Employer and the Contractor  and the same shall  be

deemed to have been accepted by them.  The Employer or the

6

6

Contractor shall not seek any arbitration thereafter.

20.3

Referring  of Disputes  for Arbitration

If the Employer’s Representative at Site fails to give notice of his

decision,  as  aforesaid,  within  a  period  of  60 days  after  being

requested as aforesaid or if either the Employer or the Contractor

be  dissatisfied  with  any  such  decision  of  the  Employer’s

Representative at Site, only then shall the matter in dispute be

referred to arbitration as herein provided

20.4  

Disputes  Due for  Arbitration and Settlement of Disputes

Disputes or  differences shall  be due for  arbitration only  if  the

conditions in Sub-Clause 20.2 and 20.3 above fulfilled.

Except where otherwise provided in the Contract, all disputes or

differences, whatsoever arising between the parties, arising out

of or relating to construction, measuring operation or effect of the

Contract or the breach thereof, shall be settled by arbitration as

detailed in Sub Clause 20.5.

20.5  

Nomination  of Arbitrators/Sole Arbitrator

Matters to be arbitrated upon shall be referred to a Sole Arbitrator

where the individual claim does not exceed Rs. 5 million or the

total value of claims does not exceed Rs. 15 millions. Beyond the

above limit(s), there shall be three arbitrators.  For this purpose

the  employer  will  make  out  a  panel  of  Arbitrators  with  the

requisite  qualifications and professional  experience relevant  to

the field to which the Contract relates and will  be residents of

India only. In case of a single arbitrator, the Panel will be of three

Arbitrators, out of which the Contractor will choose one. In case

three arbitrators are to be appointed, the Employer will make out

a panel of five.  The Contractor and the Employer will choose one

arbitrator each from the above and the two so chosen will choose

the third arbitrator from the above panel only who will act as the

7

7

“Presiding Arbitration” of the arbitration panel.

If in a dispute, the contractor fails to choose the Arbitrator within

thirty (30) days after the Employer has nominated the Panel, the

Employer  may nominate an Arbitrator  from the same panel  of

Arbitrators given by the Employer for the matter in dispute.

If,  in a dispute,  the two chosen Arbitrators fail  to appoint third

Arbitrator-  Presiding  Arbitrator  (Arbitration  Panel’s  case)  within

thirty (30) days after  they have been appointed,  the Employer

may  apply  to  the  Indian  Council  of  Arbitration,  New Delhi,  to

nominate the third Arbitrator from the same panel of Arbitrators

given by the Employer for the matter in dispute.

Neither  party  shall  be  limited  in  the  proceedings  before  such

arbitrator/s  to  the  evidence  or  arguments  put  before  the

Employer’s Representative at Site for the purpose of obtaining

his  decision.   No  decision  given  by  the  Employer’s

Representative in accordance with the foregoing provisions shall

disqualify him from being called as a witness and giving evidence

before  the  arbitrator/s  on  any  matter,  whatsoever,  relevant  to

dispute or difference referred to arbitrator/s.

Substitute Arbitrators- If for any reason on arbitrator is unable to

perform his function, a substitute shall be appointed in the same

manner as the original arbitrator.

20.6 Arbitration Venue, Language  and Award

In any Arbitration proceedings hereunder:

(a) Proceedings shall be held in Mumbai, India only.

(b)  English  language  shall  be  the  official  language  for  all

purposes. (Note: English language may be changed to any other

language, with the agreement of both the parties)

8

8

(c)  The Arbitration Award shall be final and binding on all parties

and shall be enforceable in any Court of competent jurisdiction,

and  the  parties  hereby  waive  any  objection  to  or  claims  of

immunity in respect of such enforcements.

(d)  In  Arbitral  proceedings  with  more  than  one  arbitrator,  any

decision of the arbitral tribunal shall be made by a majority of all

its members.

(e)  The Arbitrator(s) shall  always give item-wise and reasoned

awards irrespective of the value of claim(s) in the dispute in all

cases.

(f)  Where the arbitral award is for payment of money, no interest

shall be payable on the whole or any part of the money for any

period till the date on which the award is made.

(g)   The  cost  of  arbitration  shall  be  borne  by  the  respective

parties.  The cost inter-alia includes the fees of the Arbitrator(s)

as per the rate fixed by the Employer from time to time.

20.7  

Rules Governing  the Arbitration Proceedings

The arbitration proceedings shall be governed by India Arbitration

and  Conciliation  Act,  1996,  as  amended,  from  time  to  time

including provisions in force at the time the reference is made.

20.8   

No Supervision of Work

The reference to arbitration shall  proceed notwithstanding that

Works/System shall not then be or be alleged to be complete,

provided always that the obligations of the Employer/Employer’s

Representative  and  the  Contractor  shall  not  be  altered  by

reasons  of  arbitration  being conducted  during the progress of

Works.  Neither party shall  be entitled to suspend the work to

which the dispute relates on account of arbitration and payments

9

9

to  the  Contractor  shall  continue  to  be  made  in  terms  of  the

Contract.

20.9  

Limitation  of Time

No  dispute  or  difference  shall  be  referred  to  Arbitration  after

expiry of 60 days from the date of decision by the Employer’s

Representative  at  Site,  if  notified,  or  from the  date  when  the

Employer’s  Representative  at  Site  ought  to  have  given  his

decision in terms of provisions under Sub-Clause 20.2 in case of

failure on the part of the  Employer’s Representative at Site to

give notice of decision.

Since  disputes  arose  between the  parties  to  the  agreement,

various interim claims had been made by the Consortium of M/s

Larsen and Toubro,  an Indian company,  together  with Scomi

Engineering  Bhd,  a  Company  incorporated  in  Malaysia,  for

which the Consortium has filed this petition under Section 11 of

the Act to this Court, since according to them, one of the parties

to  the  Arbitration  agreement,  being  a  body  corporate,

incorporated in Malaysia, would be a body corporate, which is

incorporated in a country other than India, which would attract

Section 2(1)(f)(ii) of the Act.    

2) Shri  Gopal  Jain,  learned senior  counsel  appearing on

behalf of the Consortium, has taken us through the agreement,

in which he strongly relies upon the fact that the two entities,

that is, the Indian company and the Malaysian company, though

10

10

stated to be a Consortium, are jointly and severally liable, to the

employer. Learned senior counsel has also relied upon the fact

that  throughout  the  working  of  the  contract,  separate  claims

have been made,  which have been rejected by the Mumbai

Metropolitan  Region  Development  Authority  (hereinafter

referred to as ‘MMRDA’).  He has also further relied upon the

fact  that  by  at  least  three  letters,  during  the  working  of  the

agreement, the claims have in fact been rejected altogether and

that, therefore, there is no impediment in invoking the Arbitration

clause under Section 20.4 of the General Conditions of Contract

(hereinafter referred to as ‘GCC’), as the procedure outlined by

Clauses 20.1 to 20.03 had already been exhausted.

3) On the other  hand,  Mr.  Shyam Diwan,  learned senior

counsel appearing on behalf of MMRDA, the respondent, has

relied upon both the contract dated 09.01.2009 as well as the

actual  Consortium Agreement  dated 04.06.2008 between the

Indian company and the Malaysian company, which, when read

together,  would  show that  they are really  an un-incorporated

association and would, therefore, fall within Section 2(1)(f)(iii) as

being  an  association  or  a  body  of  individuals,  provided  the

central  management  and  control  is  exercised  in  any  country

other than India.  He has also gone on to rely heavily upon the

11

11

fact  that  in  the  Consortium,  the  lead  partner  is  the  Indian

company, and the Consortium’s office is at Wadala in Mumbai

making it clear, therefore, that sub-Clause (iii) of Section 2(1)(f)

of  the  Act  would  not  apply  as  it  is  clear  that  the  central

management and control,  that  is  envisaged by the said sub-

Clause, would not be exercised in a country outside India but in

India itself. He has also strongly relied upon an order passed by

the High Court of Bombay, dated 20.10.2016 between the same

parties,  in  which  an  interim  Award  dated  18.08.2016  was

challenged, which was between the same parties arising out of

the self-same agreement. This Order upheld the interim Award

of the Learned Arbitrators in stating that the particular claim that

was made in that case could be made only as a Consortium

and not as two entities separately.  He has also pointed out that

this Order has become final as it has not been challenged by

the petitioner before this Court.  In answering Mr. Gopal Jain’s

submission as to Clause 20.4 of the GCC being invoked after

the procedure under Clauses 20.1 to 20.3 has been exhausted,

he referred to and relied upon a letter dated 22.04.2016 written

by  the  respondent  in  which,  after  referring  to  the  various

refusals, referred to by Mr. Jain, further information and material

was requested from Mr. Jain’s client. Instead of furnishing such

12

12

material  straightaway,  a  notice  invoking  Arbitration  dated

01.07.2016 was sent by Mr. Jain’s client. The respondent, by a

reply dated 20.08.2016 reiterated its position that Clauses 20.1

to  20.3  had  not  yet  been  exhausted,  and  therefore,  on

08.09.2016, rejected the request for arbitration.

4) The contract dated 09.01.2009 is between (1) MMRDA

and (2) a Consortium, comprising, (a) L&T, an Indian Company,

and; (b) M/s Scomi Engineering Bhd, a Malaysian Company.  It

is true that each of them are jointly and severally responsible to

the employer, being collectively referred to as the “contractor.”

5) Under  the  General  Conditions  of  Contract,  the

“contractor”,  in  Clause  1.1.2.3  is  defined  as  meaning  an

Individual,  Firm,  Company,  Corporation,  Joint  Venture  or

Consortium,  whether  incorporated  or  not.  “Bidder”  is  also

defined under Clause 1.1.2.10 as meaning an Individual, Firm,

Company,  Corporation,  Joint  Venture  or  Consortium which

could  submit  a  bid.   What  is  important  to  notice  is  that  the

contract was signed by the employer, viz., MMRDA and by the

contractor  under  the head sub-Clauses (A)  and (B)  in  which

L&T India signed as ‘A’ and Scomi Engineering Bhd has signed

as ‘B’.   When we come to the consortium agreement that  is

entered into between the Indian company and the Malaysian

13

13

company as aforestated,  we find in the definition clause that

“Consortium”  shall  mean  L&T  and  Scomi  Engineering  Bhd,

acting in collaboration, for the purpose of this agreement and

shall  be  called  “the  L&T-SEB”  Consortium  “un-incorporated.”

The  contract  is  defined  in  sub-Clause  6  as  meaning,  “the

contract to be entered by the Consortium with the employer for

the execution of the Project”.  Under sub-Clause 7, “the lead

Member of the Consortium” or “Consortium Leader” shall mean

L&T,  that  is,  the Indian Company.   Under  sub-Clause 8,  the

“Supervisory Board” (hereinafter referred to as ‘the SB’) shall

mean a Board constituted under Clause 11 of the GCC.  When

we come to Clause 11.2, it  is clear that the Members of this

Supervisory Board will consist of four members, two appointed

by  each  Member.   One  of  the  Members  nominated  by  the

Consortium Leader and agreed to by all members shall then act

as the Chairman of the Supervisory Board, which is, by Clause

11.5, to decide on various matters relating to the execution of

the  contract.   Clause  21.1(g)  provides  that  the  Consortium

leader shall lead all arbitration proceedings.  

6) As correctly  pointed out  by Shri  Jain,  separate claims

were made by the Indian company and the Malaysian company

which  were  rejected  by  the  respondent.   Nonetheless,  by  a

14

14

letter  dated  22.04.2016,  the  respondent  referred  to  these

various rejection letters, and stated that documents in support

of  the  list  of  “delayed  events”  had  not  yet  been  given,  and

therefore, necessary information and clarification, in response

to certain observations, together with all documents in support

of the claim, was requested to be furnished.  By a letter dated

01.07.2016, the Consortium, instead of responding to this letter,

invoked arbitration, stating that interim claims had already been

rejected, and all  the necessary information had already been

furnished, as a result of which, the stage of Clause 20.4 had

arrived.   This was replied to by a letter  dated 20.08.2016 in

which the respondent reiterated its position that the remedies

provided under Clause 20.3 has not yet been exhausted, and

that therefore, there is no question of appointing an Arbitrator.

On 08.09.2016, the notice invoking arbitration was replied to by

the respondent, rejecting the same.

7) It is important, at this juncture, to refer to an order made

by the High Court of Bombay dated 20.10.2016 which, as has

been stated earlier, arises between the self-same parties, under

the same contract.  An interim Award made by the Arbitrators

qua different claims arising under the same contract had made

it  clear that  the claim could be filed only in the name of  the

15

15

Consortium  and  not  separately,  as  was  contended  by  Shri

Jain’s client.  The preliminary issue framed on this count was

“whether the claimants are entitled to file this claim as Claimant

No. 1 and Claimant No. 2 or only as the Consortium of L&T and

Scomi Engineering Bhd?”  The High Court of Bombay, agreed

with the interim Award of the Arbitrators, and held as follows:-

“8. Considering the terms and conditions of the contract as  well  as  the  decision  cited  by  Mr.  Ankhad,  in  my opinion, in the facts and circumstances of the present case, it is not open for the petitioners to rely upon their independent identities while dealing with the respondent and that they will have to deal with the respondent as a Consortium only.  Therefore, there is no infirmity in the impugned  order.   For  the  same  reason,  the  present petition  as  filed  would  also  not  been  maintainable. Hence, the same is dismissed.”  

8) Shri  Gopal  Jain  did  not  dispute  the  fact  that  this

judgment  was  final  inter-parties  as  no  appeal  has  been

preferred. Therefore, to stress the fact that it  pertains only to

“this claim” and would therefore, not apply to a different set of

claims  under  the  arbitration  clause  is  not  an  argument  that

appeals to us.

9) It is clear, as has been held by the judgment of the High

Court of Bombay, and which is binding inter-parties, that it is not

open for the petitioner to rely upon their status as independent

16

16

entities while dealing with the respondent and they will have to

deal with the respondent as a Consortium only.

10) This being the case, it is clear that the un-incorporated

“association” referred to in Section 2(1)(f)(iii) would be attracted

on  the  facts  of  this  case  and  not  Section  2(1)(f)(ii)  as  the

Malaysian body cannot be referred to as an independent entity

following the judgment of the High Court of Bombay.  

11) Section 2(1)(f)(iii) of the Act refers to two different sets of

persons: an “association” as distinct and separate from a “body

of individuals”. For example, under Section 2(31) of the Income

Tax  Act,  1961,  “person”  is  defined  as  including,  under  sub-

clause (v),  an association of  persons,  or  body of  individuals,

whether  incorporated  or  not.  It  is  in  this  sense,  that  an

association  is  referred  to  in  Section  2(1)(f)(iii)  which  would

therefore include a consortium consisting of two or more bodies

corporate,  at  least  one  of  whom  is  a  body  corporate

incorporated in a country other than India.

12) Further,  the  expression  “a  company  or”  which  was

originally at the beginning of Section 2(1)(f)(iii) was omitted by

Act 3 of 2016. This was for the reason that the judgment of this

Court, in TDM Infrastructure Private Ltd. v. UE Development

India  Private  Ltd.,  (2008)  14  SCC  271,  held  that  the

17

17

expression  “a  company  or”  in  Section  2(1)(f)(iii)  of  the  Act

cannot possibly be said to refer to a company registered and

incorporated in India which may be controlled by persons in a

country outside India. The Court held:

“20. The learned counsel contends that the word "or" being  disjunctive,  sub-clause (iii)  of  Section 2(1)(f)  of the 1996 Act shall apply in a case where sub-clause (ii) shall not apply. We do not agree. The question of taking recourse to sub-clause (iii) would come into play only in a case where sub-clause (ii) otherwise does not apply in its entirety and not where by reason of an exclusion clause, consideration for construing an agreement to be an international commercial arbitration agreement goes outside the purview of its definition. Once it is held that both the companies are incorporated in India, and, thus, they  have  been  domiciled  in  India,  the  arbitration agreement entered into by and between them would not be  an  international  commercial  arbitration  agreement and, thus, the question of applicability of sub-clause (iii) of Section 2(1)(f) would not arise.”

The Law Commission Report No. 246 of August 2014, which

made several amendments to the Arbitration and Conciliation

Act, 1996, gave the following reason for deleting the words “a

company or”:

“(iii) In sub-section (1), clause (f), sub-clause (iii), delete the  words  “a  company  or”  before  the  words  “an association or a body of individuals.  [NOTE: The reference to “a company” In sub-section (iii)  has  been  removed  since  the  same  is  already covered  under  sub-section  (ii).  The  intention  is  to determine  the  residence  of  a  company  based  on  its place  of  incorporation  and  not  the  place  of  central management/control. This further re-enforces the “place of  incorporation”  principle  laid  down by  the  Supreme

18

18

Court  in  TDM  Infrastructure  Private  Limited  v.  UE Development India Private Limited, (2008) 14 SCC 271, and adds greater certainty in case of companies having a different place of incorporation and place of exercise of central management and control]”

It  would  become  clear  that  prior  to  the  deletion  of  the

expression “a company or”, there were three sets of persons

referred to in Section 2(1)(f)(iii) as separate and distinct persons

who would fall within the said sub-clause. This does not change

due to the deletion of the phrase “a company or” for the reason

given by the Law Commission. This is another reason as to why

“an association” cannot be read with “body of individuals” which

follows it but is a separate and distinct category by itself, as is

understood  from the  definition  of  “person”  as  defined  in  the

Income Tax Act referred to above.

13) This being the case, coupled with the fact, as correctly

argued  by  Shri  Diwan,  that  the  Indian  company  is  the  lead

partner, and that the Supervisory Board constituted under the

Consortium  Agreement  makes  it  clear  that  the  lead  partner

really has the determining voice in that it appoints the Chairman

of  the  said  Board  (undoubtedly,  with  the  consent  of  other

members);  and  the  fact  that  the  Consortium’s  office  is  in

Wadala, Mumbai as also that the lead member shall lead the

arbitration  proceedings,  would  all  point  to  the  fact  that  the

19

19

central management and control of this Consortium appears to

be exercised in India and not in any foreign nation.

14) This being the case, we dismiss the petition filed under

Section 11 of the Act, as there is no “international commercial

arbitration” as defined under Section 2(1)(f) of the Act for the

petitioner  to  come  to  this  Court.  We  also  do  not  deem  it

necessary to go into whether the appropriate stage for invoking

Arbitration has yet been reached.

15) The  Arbitration  Petition  is  dismissed  in  the  aforesaid

terms.

16) It  would  be  open  for  the  petitioner  to  approach  the

relevant  court  on  the  footing  that  this  is  not  a  case  of  an

international commercial arbitration.

                                                            …………………………......J.                                                     (R.F. Nariman)

                                                            …………………………......J.                                                        (Navin Sinha)

New Delhi; October 3, 2018.