Centrotrade Minerals and Metal Inc. v. Hindustan Copper Ltd.
Facts of the Case
The U. S. Corporation entered into a sale agreement with Hindustan Copper Ltd. (HCL). The former was supposed to deliver 15,500 DMT of Copper concentrate to the State of Gujrat, at Kandla Port. The copper concentrate was to be used by the respondent (HCL) at Khetri Plant. The agreement consisted of a two-tier clause (Clause 14 of the agreement). The clause stated that in a case of a dispute, Arbitration proceedings must begin India to resolve the dispute. But if either of the parties are unsatisfied by the same, they may appeal for a second arbitration to be held at the International Court of Arbitration in London. A dispute arose and the appellant invoked the arbitration clause. By the award at 15.06.1999, the Arbitrator appointed by indian Council of Arbitration gave a Nil Award. Aggrieved by the Award, the appellant appealed for a second arbitration at ICC, London. HCL, during the pendency of the Arbitration appeal at ICC, filed a suit in the Court of Khetri in the State of Rajasthan challenging the two - tier arbitration clause.
Issues of the Case
1. Is two-tier Arbitration legal in India?
2. Is the two-tier clause valid?
Judgement of High Court of Rajasthan and Supreme Court regarding stay on London Proceedings
In the revision petition filed against the Court of Khetri, the Hon'ble High Court held that there must be a stay in proceedings taking place in ICC. The appellant must not take further steps in the London Arbitration. An appeal against the ad interim ex parte stay was made to the Supreme Court by the appellant. Supreme Court vacated the stay. Mr. James Cook QC, the arbitrator appointed by ICC, London delivered an award on 29. 09.2001.
Calcutta High Court on enforcement of Second Arbitration Award
HCL raised objections under Section 48 of the Arbitration and Conciliation Act, 1996 (conditions for enforcement of foreign award) against the second arbitration award by Mr. Cook. The learned judge dismissed the objections and stated that the ICC Award was executable. A Division Bench of the Calcutta High Court stated the London Award could noyt be called a foreign award but a two-tier Arbitration award is valid. Moreover, the Indian Arbitral Award and the London Arbitral Award were arbitration awards by arbitrators who had concurrent jurisdiction, both awards were mutually destructive of each other and hence neither could eb enforced. As a result of the same, the appeal was allowed.
Judgement by Supreme Court
The Supreme Court held that the respondent did not participate in the arbitral proceedings even though they were invited to do so. The Arbitrator took account of the same and passed an Award. No fault could be found on the conduct of the Arbitral proceedings in India on the basis of the facts of the case. Moreover, the case filed by the respondent under Section 48 to the Calcutta High Court was held as not maintainable as it was outside the jurisdiction of enforcing an award. The coirt further stated that the Foreign Award must be enforced.
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.