Barminco Indian Underground Mining Services LLP v. Hindustan Zinc Limited, 20th July 2020. [i]
Facts of the case:
In case starts on March 11th, 2019 when the applicant ie, Barminco Indian Underground Mining Services, which is a limited liability partnership, they enter into a contract with Hindustan Zinc Limited to provide their service for the development of Rampura Agucha Mine. During the performance of work, Barminco raised invoices and these invoices were duly paid by Hindustan Zinc Limited. But invoices for February and March 2020 were not paid and also the claims raised under the Change in Law clause and force majeure were also not paid by the applicant.
The respondent cited that the contract was financially unviable and demanded renegotiation of the terms of the contract with a request to reduce the scope of work by 50%. But the applicant Barminco refused to accept the offer made by the respondent and demanded the termination of the contract via a letter dated 19th April 2020, according to the letter this termination will be in effect from 1st May 2020. The applicant further demanded the respondent to pay for the work done during the period from January to March. Even the respondent claimed a huge some against the applicant.
Both parties decided to present an application under section 9 Arbitration and conciliation act 1996, as there is a clause in the contract which provides for settlement of disputes through arbitration.
Issue of the case:
The issue, in this case, was that which court will have jurisdiction over the matter to entertain the application under section 9 as the venue and seat of the arbitration is Singapore.
The decision of the court:
The court in this case said that since the venue and seat of arbitration are in Singapore it can be concluded that it is not a domestic arbitration and neither its awards passed would be domestic award. In this case, even though the arbitration is not International Commercial Arbitration but the awards passed will be International award (foreign award).
An agreement of arbitration can have foreign awards and yet can be any arbitration it doesn't need to be International Commercial Arbitration. If the arbitration is not International Commercial Arbitration then the definition of court according to section 2 (1) (e) is High court or principal court having original jurisdiction.
In this case, since it is not International Commercial Arbitration the definition of court in this present case is principal civil court, this court has jurisdiction over the matter of this case. Therefore it was held by the court that the High court has no jurisdiction over the present scenario to hear the matter under section 9 of the arbitration and conciliation act 1996. The jurisdiction to hear the matter vests in the commercial court according to section 10 (3) of the act.
This Article Does Not Intend To Hurt The Sentiments Of Any Individual Community, Sect, Or Religion Etcetera. This Article Is Based Purely On The Authors Personal Views And Opinions In The Exercise Of The Fundamental Right Guaranteed Under Article 19(1)(A) And Other Related Laws Being Force In India, For The Time Being.