Avitel Post Studioz Ltd.And 3 Ors vs Hsbc Pi Holdings (Mauritius) Ltd
2017 Latest Caselaw 2358 Bom

                                 1                  APP-155-16(J)

        IN THE HIGH COURT OF JUDICATURE AT BOMBAY
           ORDINARY ORIGINAL CIVIL JURISDICTION


                   APPEAL NO. 155 OF 2016
                             IN
             ARBITRATION PETITION NO.690 of 2015



1    Avitel Post.Studioz Limited
Company incorporated under the
provisions of the Companies Act,1956
having its regd. Office at A-7, Vimal
Udyog Bhavan, Taikal wadi Road,
Opp. Starcity Cinema,
Mahim (W), Mumbai - 400016.

2     Pradeep Shantiprasad Jain
adult, Indian inhabitant, carrying on
business at A-7, Vimal Udyog Bhavan,
Taikal wadi Road,Opp. Starcity Cinema,
Mahim (W), Mumbai - 400016.

3     Siddhartha Pradeep Jain
adult, Indian inhabitant, carrying on
business at A-7, Vimal Udyog Bhavan,
Taikal wadi Road,Opp. Starcity Cinema,
Mahim (W), Mumbai - 400016.

4     Hrishi Pradeep Jain
adult, Indian inhabitant, carrying on
business at A-7, Vimal Udyog Bhavan,
Taikal wadi Road,Opp. Starcity Cinema,
Mahim (W), Mumbai - 400016.            .. Appellants

                Versus



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                                          2                     APP-155-16(J)

HSBC PI Holdings (Mauritius) Ltd.
(previously named HPEIF Holding 1
Limited) a company incorporated under
provisions of laws of Mauritius and
having its registered office at
c/o.Multiconsult Limited,
Rogers House, 5 President John
Kennedy Street, Port Louis
Mauritius.                         .. Respondents

                                             ...

Mr.Pradeep Sancheti, Sr. Counsel a/w Mr.Simil Purohit,
Sanjay Agarwal, H.K. Sudhakara i/b Prompt Legal for the
appellants.

Mr.Nikhil Sakhardande a/w Priyanka Shetty,                             Uttara
Srinivasan i/b AZB and Partners for respondent.


                                   CORAM: DR. MANJULA CHELLUR, CJ. &
                                          G.S. KULKARNI, J.

                     RESERVED ON : 3rd APRIL, 2017
               PRONOUNCED ON : 5th MAY, 2017.


JUDGMENT (Per Dr.MANJULA CHELLUR, CJ):

1 In brief, the background in which the present Appeal is filed is as under :

The appellants herein were the petitioners before

the learned Single Judge who filed two petitions under

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Section 34 of the Arbitration and Conciliation Act, 1996 (for

short "the Arbitration Act"), impugning Arbitral awards dated

27th September 2014 and 17th December 2012 in Arbitration

Nos. 088 of 2012 and 690 of 2015 respectively.

2 In order to expand the business of the appellants,

appellants intended to raise funds through private equity

investors desirous of investing in the petitioners' company

which was known for consistent profit making and dividend

paying Company. An affiliate of the respondent's Company

known as "HAV3" was an investor-cum-shareholder in the

petitioner Company, therefore, had first right for further

issuance of shares by the petitioner's company. On persuasion

from respondent no.3 that further funds must be taken

through them, the present respondent was introduced to

them by HAV3. Though several offers came from different

globally renowned Private Equity Funds for investing at a

much higher valuation, the appellants had to heed to the

demand of HAV3 since they had first right for further

investment. The appellant no.1 is a Company incorporated

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under the provisions of the Companies Act, 1956 having its

registered office at Mumbai. Respondent is a Company

incorporated under the laws of Mauritius and has its

registered office at Mauritius. The respondent is an

Investment Holding Company for the Principal Investments

Asia Division of HSBC. On 21st April 2011, the appellants and

the respondents entered into Share Subscription Agreement

(hereinafter referred to as "SSA"). Again on 6th May 2011, the

first appellant, respondent and their promoters and HAV3

Holdings (Mauritius) Ltd, and their investors entered into a

Share Holders Agreement (hereinafter referred to as "SHA").

3 Respondent seems to have invoked arbitration

agreements in SSA as well as SHA on 11 th May 2012.

Singapore International Arbitration Centre (SIAC) was seized

of Arbitration Nos.088 of 2012, 089 of 2012 respectively. In

those proceedings, the respondent sought emergency reliefs

under the relevant arbitration provisions of SIAC 2010

Rules. One Mr.Thio Shen Yi, S.C. was appointed as

emergency arbitrator. An interim award in SSA and SHA

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arbitrations respectively came to be made on 28th and 29th

May 2012, thereby freezing of the accounts of the appellants,

requiring them to disclose to HSBC Mauritius all that

information regarding their assets and deliver the said

information came to be directed. The emergency arbitrator

also allowed various expenses to be borne by the appellants.

In this context, the respondent called upon the first appellant

to make their share of payment towards the first tranche of

deposit.

4 On 17th December 2012, the Arbitral Tribunal

passed an unanimous partial award in the SSA arbitration

holding jurisdictional challenge of the appellants against

them and declared that Indian law was not governing the law

of arbitration, and it was Singapore law that governed the

arbitration agreements. It also opined that allegations of

fraud and/or complicated issues of fact and law also be

arbitrated under Singapore law. It also held that Arbitral

Tribunal at Singapore had jurisdiction to adjudicate the

dispute arising under the SSA between the petitioner and the

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respondent. Similarly, on 15th March 2013, the Arbitral

Tribunal passed an unanimous award in SHA arbitration by

rejecting the challenge of the appellants so far as the

jurisdictional challenge and declared that Singapore law

determines the jurisdiction of the tribunal based on Section

11 of the Singapore International Arbitration Act read with

Article 34 of Model Law. It further opined that Singapore law

takes into its fold the arbitrability of disputes including the

issues of fraud, and proceeded to hold that the claims made

by the respondent against the appellants were not contrary to

Singapore public policy, therefore, such claims were

arbitrable. A final award came to be made in both the

matters.

5 The respondents herein filed Arbitration Petition

No.1062 of 2012 before this Court, inter alia, seeking various

interim measures against the appellants herein which was

seriously opposed by the appellants on various grounds

including the ground of maintainability of the said Arbitration

Petition filed under Section 9 of the Arbitration Act. The

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learned Single Judge granted interim relief in favour of the

respondent Company by an order and judgment dated 22 nd

January 2014 by which learned Single Judge restrained the

appellants from withdrawing the amounts retained in the

Corporation Bank to an extent of 60 Million US $. Though a

Special Leave Petition came to be filed impugning the said

judgment and order of the learned Single Judge before the

Apex Court, on raising objection by the respondents herein

that an Appeal was permissible under Section 37(1)(a) of the

Arbitration Act, the appellants hereunder withdrew the said

Special Leave Petition seeking liberty to challenge the

impugned order by way of Appeal before the Division Bench

of this High Court. The said prayer was allowed. An Appeal

No.190 of 2014 was preferred before the Division bench of

this Court, impugning the judgment in Arbitration Petition

No.1062 of 2012. The said Appeal was partly allowed and

substituted the operative part of the learned Single Judge by

directing the appellants herein to deposit the short-fall in the

Corporation Bank account of the petitioners so as to maintain

the balance only to an extent of 30 Million US $ within a

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period of four weeks from the date of order dated 31 st July

2014. Rest of the directions in the judgment dated 22 nd

January 2014 were sustained. Said judgment and order

dated 31st July 2014 is under challenge before the Supreme

Court and the Special Leave Petition is pending.

6 Arguments on behalf of the appellants addressed

by learned Senior counsel Mr.Pradeep Sancheti before the

learned Single Judge as well as before this Court mainly refer

to clauses 15, 16, 16.1.2, 16.1.6, 16.4, 16.1.7 and also 16.4

of the SSA agreement. According to him, though clause 16

provides for a reference of dispute to arbitration at Singapore

International Arbitration Centre (SIAC) which has to be

considered in accordance with the Rules in force at SIAC, seat

of arbitration being at Singapore, however, by virtue of clause

16.1.6, there is a waiver of such right by the parties to apply

to any Court of law to determine any preliminary point of law

or review or any question of law, and/or merits. He also

submitted the aspect of 'Curial Law' by referring to clause

16.4 of the SSA, contending that it is distinct from the other

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two aspects i.e. proper law governing the contract or the law

governing the substantive rights of the parties under the

contract and the law of arbitration agreement. His main

argument is that during the continuance of the proceedings,

Curial Law operates and the authority of such Courts ceases

once the proceedings are concluded. Therefore, clause 16.4

of SSA, according to learned Senior Counsel cannot be

understood to mean that the parties had waived their right to

challenge the award under Section 34 of the Arbitration Act

of 1996 since it was not in the realm of Curial Law. He

submits such contention by placing reliance on 16.1.6 of the

agreement. It is argued that provision of Part I to challenge

any award was not excluded per se. Therefore, according to

him, challenge against an arbitral award though was

protected under clause 16.1.6, the same is not over-ridden by

clause 16.4. Therefore, this Court had entertained the appeal

filed by the appellants under Section 37(1)(a) of the

Arbitration Act by which the appellants had impugned the

order and judgment delivered by the learned Single Judge

under Section 9 of the Arbitration Act. He also contends that

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since provisions of Appeal under Section 37(1)(a) was

applicable to the proceedings filed by the appellants, the

proceedings u/s.34 of the Arbitration act impugning the

arbitral award which falls under Part I of the Arbitration Act is

also permissible. It is further contended that Section 9 of the

Arbitration Act would actually fall within the purview of

Curial Law, therefore, the judgment though between the same

parties cannot be applied to the facts of this case. With

reference to the decision in Bharat Aluminium Company Vs.

Kaiser Aluminum Technical Services Inc, 1 law laid down is

prospective in nature and since the agreements entered into

between the parties herein were entered prior to the

pronouncement of the said judgment, the said judgment

would not apply to the facts of the case. He further contends

that Bhatia International Vs. Bulk Trading S.A, 2 would

apply to the facts of the case, wherein the provisions of Part I,

Arbitration Act of 1996 were held equally applicable to

International Commercial Arbitrations held outside India.

Similarly, the cases of Reliance Industries Ltd & Anr Vs.

1(2012) 9 SCC 552, 2(2002) 4 SCC 105,

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Union of India,1 and National Thermal Power Corporation

Ltd. Vs. Singer Company & Ors,2 would not be applicable to

the present case. He also contended that in the facts of the

present case, there was no controversy as to the applicable

law being different on different aspects since the proceedings

at Singapore have been concluded. Therefore, the Indian

Courts can adjudicate the present issue.

7 The respondent's stand before the learned Single

Judge as well as before us is that both the agreements SSA

and SHA were entered into between the parties prior to 6 th

September 2012 i.e. the date of the judgment of the Apex

Court in Bharat Aluminum Company (supra). They place

reliance upon clauses 15, 16.1, 16.1.1, 16.1.2, 16.1.3, 16.1.4,

16.1.5, 16.1.6, 16.1.7 and 16.4 of SSA and clauses 18.1, 19.1,

19.3 and 19.4 of SHA agreement. According to them, express

exclusion of Part I of the Act, save and except Section 9 of the

Arbitration Act, 1996 and reading of clauses 16.1.6 of SSA

and 19.1 of SHA permit challenge to the award on certain

1(2014) 7 SC 603, 2(1992) 3 SCC 551

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grounds to the extent permitted by law of the seat of

arbitration and those clauses further indicate that parties

contractually intended that the award has to be challenged at

the seat of the arbitration alone.

8 By placing reliance on Bhatia International

(supra), respondent's counsel argued that unless the parties

by agreement, express or implied terms had excluded all or

any of Part I of the Arbitration Act, in the case of International

Commercial arbitrations held out of India, the provisions of

Part I would apply. According to them, since the parties had

categorically excluded Part I as stated above, the petitions

filed under Section 34 of the Arbitration Act are not

maintainable.

9 Reference is made to judgment of learned Single

Judge in Arbitration Petition No.1062/12 between the same

parties in a proceedings under Section 9 of the Arbitration

Act. Appeal No.190 of 2014 came to be filed against the

judgment of learned Single Judge in Arbitration Petition

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No.1062 of 2012. The Division Bench after referring to

various provisions of the agreements SSA and SHA, opined

that parties have either by express terms or by implication

agreed that the law for arbitration shall be the Rules of SIAC

i.e. laws of Singapore.

10 It is contended that by clause 16 of SSA and

clause 19 of SHA, the parties expressly had agreed to exclude

Part I of Arbitration Act, except Section 9 therefore, there is

implied exclusion of applicability of Part I of Arbitration and

Conciliation Act, 1996 because the juridical seat of Arbitration

under SSA and SHA being Singapore and said proceedings

being conducted as per SIAC rules, laws of Singapore.

11 The respondent also placed reliance on Section 5

of Singapore Act, Part II of the Singapore Act, and so also

Model Law applicable to International Arbitrations in

Singapore to substantiate their arguments as stated above.

According to them, under Article 34 of the Model Law, with

reference to application for setting aside arbitral award could

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be made only by an application in accordance with said

article, but not under any of the provisions of Part I of the

Arbitration and Conciliation Act, 1996, since Section 9 has

been excluded by necessary implication in terms of the

agreement.

12 It is contended that since juridical seat of

arbitration is in another country, the provisions of the

arbitration law of that country which deal with challenges to

an arbitral award, mandatorily such provisions will alone

apply. Therefore, they contend that the challenge to the

award cannot be under Section 34 of the Arbitration Act.

According to respondent, the terms of two agreements SSA

and SHA providing facility of challenge to the arbitral award

to the extent permitted by the law at the seat of arbitration

would clearly indicate that parties intended at the time of

agreement that challenge to the award could be only at the

seat of arbitration, Singapore.

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                                       15                        APP-155-16(J)

13              Reference is made to Special Leave Petition which

came to be withdrawn with a permission to file an appeal

under Section 37(1)(a) of the Arbitration Act before the

Division Bench which could mean that the petitioners -

appellants were entitled to file these two petitions under

Section 34 of the Act since the Appeal is a continuation of the

original proceedings is also stand of the appellants.

14 Learned Single Judge by referring to clause 15 of

the agreement opined that arbitration proceedings being held

at Singapore in accordance with International Arbitration

Rules, the agreement to arbitrate at Singapore has a closer

and real connection with the place where the parties had

chosen to arbitrate. Therefore, held arbitration agreement

would be governed by law of Singapore and not law of India.

He further held that law laid down in Sumitomo Heavy

Industries Ltd Vs. ONGC Ltd,1 and National Thermal Power

Corporation Ltd Vs. Singer Company & ors, 2 would

squarely be applicable to the facts of the present case.

1(1998) 1 SCC 305
2(1992) 3 SCC 551

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                                  16                             APP-155-16(J)




15              By referring to earlier proceedings, with reference

to clause 16.4 of the agreement, learned Judge was of the

opinion that the argument of the appellants that clause 16.4

of the petition did not oust Indian law, cannot be accepted.

16 Learned counsel for the appellants relied upon

Sumitomo Heavy Industries Ltd Vs. ONGC Ltd (supra),

National Thermal Power Corporation Ltd. Vs. Singer

Company & Ors (supra).

17 Learned counsel appearing for the respondents

relies upon Bhatia International Vs. Bulk Trading S.A

(supra), Harmony Innovation Shipping Limited Vs. Gupta

Coal India Limited & Anr,1 Reliance Industries Ltd & Anr

Vs. Union of India (supra) and Reliance Infrastructure Ltd.

Mumbai Vs. Roadway Solution (I) Pvt.Ltd, Pune               2




1(2015) 9 SCC 173,

2 2016(3) Mh.L.J

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                                     17                             APP-155-16(J)

18              It would be relevant to point out the relevant

clauses of agreements between the parties. In order to

understand the controversy and the jurisdiction issue raised in

these matters, one has to refer to Share Subscription

Agreement (SSA) dated 21st April 2011 and the relevant

clauses are clauses 15, 16.1, 16.1.1, 16.1.2, 16.1.6, 16.1.7,

16.4.

"Clause 15

15. GOVERNING LAW This Agreement shall be governed by an construed in accordance with the laws of the Republic of India without regard to applicable conflict of Laws principles.

Clause 16

16. DISPUTE RESOLUTION

16.1 Arbitration

16.1.1 Any dispute, controversy or claim arising out of or in connection with this Agreement, including any question regarding its existence, validity, interpretation, breach of termination shall be referred to and finally resolved by binding arbitration at the Singapore International Arbitration Centre ("SIAC") in accordance with the Singapore International Arbitration Rules in force at the date of this Agreement ("Rules"), which Rules are deemed to be incorporated by reference into this clause and as may be amended by the rest of this clause.

16.1.2 The seat of arbitration shall be at Singapore......

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16.1.6 The parties waive any right to apply to any court of law and/or other judicial authority to determine any preliminary point of law and/or review any question of law and/or the merits, in so far as waiver may be validly made. The parties shall not be deemed, however, to have waived any right to challenge any award on the ground that the tribunal lacked substantive jurisdiction and/or the ground of serious irregularity affecting the tribunal, the proceedings or the award to the extend allowed by the law of the seat of the arbitration.

16.1.7 Nothing, in this Clause 16.1 shall be construed as preventing any party from seeking conservatory or interim relief in any court of competent jurisdiction ...

16.4 Application of Arbitration Act Save for section 9, Part I of the Indian Arbitration and Conciliation Act, 1996 ("the Arbitration Act"), the provisions of Part I of the Arbitration Act shall not apply to the terms of this Agreement."

19 Similarly, by virtue of Shareholders Agreement

(SHA) dated 6th May 2011, parties entered into several terms

of understanding and the relevant clauses are 18.1, 19.1 and

19.4.

"Clause 18.1 of the said agreement provides that the same shall be governed by and construed in accordance with the laws of Republic of India without regard to applicable conflict Laws principles.

Clause 19.1 provides for arbitration at Singapore International Arbitration Centre in accordance with SIAC Administered Arbitration Rules in force.

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Clause 19.4 provided that save for section 9 of Part I of the Arbitration Act shall not apply to the terms of that agreement."

20 National Thermal Power Corporation Ltd. Vs.

Singer Company (supra), is relied upon by appellants counsel

by placing reliance on paras 23 - 25 & 27. It is contended

that the normal practice would be the proper law of the

arbitration agreement is generally the same as the proper law

of the contract, and only in exceptional cases, it need not be

so where the proper law of the contract is expressly chosen by

the parties. According to him, a presumption would arise

where there is no express choice of the law governing the

contract as a whole or the arbitration agreement as such, and

in such event, presumption may arise that the law of the

country where the arbitration is agreed to be held is the

proper law of the arbitration agreement. He also contends

that so far as the validity of the arbitration agreement,

including the effect and the interpretation are governed by its

proper law, and such law will decide whether the arbitration

clause is wide enough to cover the dispute between the

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parties. He also stresses upon the fact that parties have

freedom to choose the law governing an International

Commercial Arbitration Agreement, and further contends that

where the proper law of the contract is expressly chosen by

the parties, such law must, in the absence of an unmistakable

intention to the contrary, govern the arbitration agreement

which, though collateral or ancillary to the main contract,

nevertheless a part of such contract. When proper law of the

contract between the parties expressly stipulated to be the

laws in force in a particular country and exclusive jurisdiction

of the Courts at a particular place, the parties not having

chosen expressly or by implication a law different from Indian

Law in regard to the agreement contained in the arbitration

clause, the proper law governing the arbitration clause is

indeed the laws in India.

21 Appellants' counsel also banks upon Sumitomo

Heavy Industries Ltd Vs. ONGC Ltd (supra). This was a case

where parties to the contract/agreement belonging to

different countries agreed upon that arbitrability of the

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dispute to be determined in terms of the law governing the

arbitration agreement and the arbitration proceeding has to

be conducted in accordance with the curial law and after

rendering of the award, enforcement thereof has to be again

in accordance with the law governing the arbitration

agreement. Learned counsel for the appellants places reliance

on paragraph no.10 of the said judgment to contend that the

law governing the contract creating substantive rights of the

parties in respect of which the dispute has arisen, the proper

law of the arbitration agreement, the law governing the

obligation of the parties to submit the disputes to arbitration

and to honour the award must be the Curial law i.e. the law

governing the conduct of the individual reference. He further

emphasizes that where there is absence of express agreement,

a strong presumption arises that parties intended the curial

law to be the law of the 'seat'of the arbitration. According to

him, the enforcement process is entirely different since it is

subsequent to and independent of the proceedings before the

arbitrator since the need to challenge the award arises only if

it is being enforced.

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                                    22                          APP-155-16(J)

22              Respondent's counsel drew our attention to

Bhatia       International       Vs.    Bulk   Trading      S.A,(supra),

paragraph no.32 wherein their Lordships opined that

provisions of Part I would apply to all arbitrations and to all

proceedings relating thereto when such arbitration is held in

India. The provisions of Part I would compulsorily apply and

parties are free to deviate only to extent permitted by the

derogable provisions of Part I. In case, international

arbitrations were held outside India, provisions of Part I

would apply unless the parties by agreement, express or by

implication, exclude all or any of its provisions. In such

situation, depending on the terms of agreement, the laws/

rules/regulations agreed upon by the parties would prevail.

Therefore, it was opined that any provision from Part I which

is contrary to or excluded by that law or rules will not be

applicable.

23 In Harmony Innovation Shipping Limited Vs.

Gupta Coal India Limited & Anr, (supra) the litigation was

in respect of foreign seated international commercial

arbitration. The issue arose was whether judgment referred

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in Bharat Aluminium Company Vs. Kaiser Aluminum

Technical Services Inc (supra), would apply. Their Lordships

in unequivocal terms opined that since there was ample

material indicating the intention of the parties through

various phrases used in the arbitration agreement, with

regard to seat of arbitration, who should be arbitrators and

the contract to be governed and construed according to which

law, therefore, opined that the seat of arbitration will be at

London, and further opined that the contract be governed and

construed according to the English law. They further opined

that the clauses in the arbitration agreement should be looked

into to understand whether a particular clause in question is

substantial arbitration clause or a curial/procedural one.

Ultimately, opined that law laid down in Bharat Aluminium

Company Vs. Kaiser Aluminum Technical Services Inc

(supra) is not applicable to agreements entered into prior to

6th September 2012 (date of decision of said case), and

opined that the law rendered in Bhatia International Vs.

Bulk Trading S.A (supra) is applicable. They further opined

that the clear unambiguous terms/clauses stipulated in the

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arbitration agreement clearly points out juridical seat being

London and ouster of jurisdiction of Indian Courts.

24 So far as Reliance Industries Ltd & Anr Vs.

Union of India (supra), in this case, the Apex Court in detail

referred to the law which would be applicable to the filing of

the award, enforcement of award, and also the law which

provides for setting aside the agreement to arbitrate and the

performance of parties.

25 In Reliance Infrastructure Ltd. Mumbai Vs.

Roadway Solution (I) Pvt.Ltd, Pune (supra), it was held that

the parties to the agreement having agreed to a place of

arbitration for all disputes arising out of the said agreement

shall be subject to jurisdiction of Mumbai Court. Since no

challenge was made to said terms and clauses of agreement,

therefore, such terms and clauses are binding on the parties.

26 Going through the above decisions, terms of two

agreements SSA and SHA, one has to see what happens in the

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present case with reference to the terms of two agreements in

the light of above judgments.

27 So far as factual situation in the earlier

proceedings, learned Single Judge as well as Division Bench

in the proceedings filed under Section 9 of Arbitration Act

opined that in the light of jurisdictional award and interim

award being made by Arbitral Tribunal between the same

parties arising out of the same agreement in the arbitration

proceedings at Singapore determines the jurisdiction of the

Arbitral Tribunal, and in the partial award dated 17 th

December 2012, it is declared that the parties are governed

by Singapore law in terms of arbitration agreement.

28 In the present case, after detail discussion of the

judgment of the Single Judge and Division Bench in the

earlier proceedings, learned Single Judge was justified in

opining that there is finality so far as interpretation of some

clauses of SSA and SHA. On perusal of the terms of

agreement, clause 16.1.2 clearly mentions that the seat of

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arbitration shall be Singapore. 16.1.6 - First Part clearly

indicate that parties have waived their right to apply to any

Court of law for determination on any preliminary point of

law/review any question of law and merits only in so far as

such waiver. They further agree that such waiver shall not be

deemed to have included waiver of right to challenge any

award on the ground that the Tribunal lacks substantive

jurisdiction or the grounds of serious irregularity affecting the

Tribunal, the proceedings or the award to the extend allowed

by the law of the seat of arbitration. In other words, since the

seat of arbitration was Singapore, the parties reserve right to

challenge award on the ground that the Tribunal lacks

substantive jurisdiction or there exists serious irregularity

affecting the proceedings, etc alone.

29 16.4 clearly indicate application of Arbitration Act

of 1996. It clearly says except for the purpose of Section 9,

provisions of Part I of Indian Arbitration and Conciliation Act,

1996 shall not apply to the terms of the agreement. From

reading of the above terms, it is crystal clear that seat of

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arbitration is at Singapore and the parties have waived

the right to apply to any Court of law with regard to

preliminary point of law as indicated at 16.1.6 except right to

challenge award on the ground that the Tribunal lacks

jurisdiction, etc. Definitely, this does not mean that the

provisions of Part-I of Arbitration Act shall apply to the terms

of the agreement.

30 So far as SHA is concerned, the agreement shall

be governed by the laws of Republic of India without regard

to applicable conflict of laws principles. Clause 19.1 refers to

arbitration at SIAC in accordance with the SIAC administered

arbitration Rules that were in force. Again, clause 19.4

provides that except invoking provisions of section 9 of

Arbitration and Conciliation Act, 1996, the entire Part-I of the

1996 Act is not applicable. Therefore, reading both the

agreements with reference to the above clauses, it is crystal

clear that 16.4 of SSA can be considered as an amendment to

16.1.1, and 16.1.6 carves out exception to an exception.

Reading of clause 16.4 along with clause 19 of SSA and 19.4

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of SHA, there is no scope to understand the terms agreed

between the parties otherwise. In other words, except

invoking provisions of Section 9 of Arbitration Act, the entire

Part I of Arbitration Act of 1996 (Indian Law) is expressly

excluded, thereby any challenge made under Section 34

cannot be entertained in terms of law applicable in India.

Parties have expressly excluded application of Part I of 1996

Act, except provisions of Section 9 of Part I of Arbitration Act,

1996.

31 In view of the above discussion and reasoning, we

find no good ground raised in the arguments of the appellants

warranting interference with the opinion expressed by the

learned Single Judge while dismissing Arbitration Petition

No.690 of 2015 and 757 of 2015.

32 Accordingly, Appeal is dismissed. No order as to

costs.

     (G.S.KULKARNI, J)                      (CHIEF JUSTICE)




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