The Supreme Court has recently declared that when parties to arbitration mutually decide to change their place or venue of arbitration, then such changed venue also becomes the seat of arbitration.

In this case, the parties had agreed to the arbitrator’s proposal to change the venue of arbitration. Although no formal written agreement had been executed between the parties for such change of venue, the Court held that agreeing to change of venue was sufficient to constitute change.

Accordingly, the venue of arbitration was shifted from Rajasthan to Ahmedabad. Therefore, the Apex Court held that after such change, the courts in Ahmedabad, and not Rajasthan, had become the competent courts to decide an application under Section 34 of the Arbitration Act.

Judgement details :

• M/s Inox Renewables Ltd v Jayesh Electricals Ltd [Civil Appeal No. 1556/2021].

Judgement link :
https://www.livelaw.in/pdf_upload/ms-inox-renewables-ltd-v-jayesh-electricals-ltd-392044.pdf

The Calcutta High Court has finally settled a pertinent question in arbitrations, which is whether an arbitral award-holder’s claim gets extinguished if the arbitral-debtor’s resolution plan is approved under the Insolvency and Bankruptcy Code (IBC).

Answering the question in the positive, the High Court said that claims against an arbitral-debtor get automatically extinguished after a resolution plan against it is approved by the National Company Law Tribunal.

Therefore, an operational creditor who fails to lodge its claim in the corporate insolvency resolution process against an arbitral-debtor loses the fruits of its arbitral award even if a challenge against the award is pending in a civil court.

The court also stated that even if any challenge to the arbitral award under Section 34 of the Arbitration Act by the arbitral-debtor is pending in court during insolvency resolution process is going on, the award-holder can still file its claim under the resolution process.

Judgement details :

• Sirpur Paper Mills Limited v. I.K. Merchants Pvt. Ltd. [A.P. 550 of 2008, Calcutta HC].

Judgement link :
https://services.ecourts.gov.in/ecourtindiaHC/cases/display_pdf.php?filename=DGLYj3d%2B3YUl7w50SUed9pYWWjbCNDR%2FKOdNl6R5aNQA8WSFHnrOiSDstv2%2FH2X6&caseno=AP/550/2008&cCode=1&appFlag

A 3-judge bench of the Supreme Court has declared that strangers cannot be entitled to file appeals under Section 96 of the Code of Civil Procedure (CPC) unless they can satisfy the appellate court that they are “aggrieved persons”.

Merely saying that a person is prejudicially affected by a decree is not sufficient because, the court observed, that he should be able to prove that he is prejudicially or adversely affected or any of his rights have been jeopardized by the decree.

The court refused to grant relief to the parties that approached it, saying that the decree under question applied only to the original plaintiffs and defendants, and that it did not create any rights in rem which a third party court claim without satisfying the criteria of being an “aggrieved party” as per relevant provisions of CPC pertaining to appeals.

This judgement can be found here :
https://main.sci.gov.in/supremecourt/2019/33068/33068_2019_33_1501_23510_Judgement_21-Aug-2020.pdf