Chloro Controls India Pvt. Ltd. Vs. Severn Trent Water Purification Inc.
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Head Note
The Arbitration and Conciliation Act, 1996 - Section 45
Multiple and multi-party agreements - Non-signatory parties - Even non-signatory parties to some of the agreements can pray and be referred to arbitration provided they satisfy the pre-requisites under Sections 44 and 45 read with Schedule I. Reference of non-signatory parties is neither unknown to arbitration jurisprudence nor is it impermissible - Held - In the facts of a given case, the Court is always vested with the power to delete the name of the parties who are neither necessary nor proper to the proceedings before the Court - In the cases of group companies or where various agreements constitute a composite transaction like mother agreement and all other agreements being ancillary to and for effective and complete implementation of the Mother Agreement, the court may have to make reference to arbitration even of the disputes existing between signatory or even non-signatory parties - However, the discretion of the Court has to be exercised in exceptional, limiting, befitting and cases of necessity and very cautiously.
Topic(s)-Multiple and Multi-Party Agreements
Important Decision(s)- The Court is always vested with the power to delete the name of the parties who are neither necessary nor proper to the proceedings before the Court.