High Court of Delhi sets parameters for exceptional circumstances to invoke Article 227 of the Constitution against arbitral tribunal’s order and holds that objections to tribunal’s jurisdiction are to be dealt with utmost urgency
The Petitioners herein were arrayed as parties in an arbitration arising out of a dispute between two brothers and their respective families under a family settlement/partition deed. In a civil suit filed by one of the brothers and his family, the High Court of Delhi (“Court”) had referred the dispute to arbitration in an application filed by the other brother under Section 8 of the Arbitration and Conciliation Act, 1996 (“Act”).
The Petitioners filed objections under Section 16 of the Act (Competence of arbitral tribunal to rule on its jurisdiction) and stated that the arbitrator has no jurisdiction to adjudicate the claims against the Petitioners since the Petitioners were bona fide purchasers of the property having valid title deeds and therefore, the arbitration clause was not binding upon them, and that the Petitioners were neither parties to the suit nor parties to the arbitration agreement and thus, cannot be compelled to participate in the arbitration proceedings.
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