Essar Oil Ltd. Vs. Hindustan Shipyard Ltd. & Ors.
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Head Note
The Arbitration and Conciliation Act, 1996 - Section 34
Arbitration - Privity of Contract - Arbitral award - Objection against - Arbitration Agreement was only between the appellant and the respondent - ONGC was not a party to the Arbitration Agreement - When a dispute had arisen between the appellant and the respondent in relation to payment of money, the appellant had initiated the arbitration proceedings - As the ONGC was not a party to the Arbitration Agreement, it could not have been represented before the Arbitral Tribunal - If the ONGC was not a party before the Arbitral Tribunal, the Tribunal could not have made any Award making the ONGC liable to make payment to the appellant -Majority view of the Arbitral Tribunal was to the effect that the ONGC, not being a party to any contract or Arbitration Agreement with the appellant, could not have been made liable to make any payment to the appellant - Impugned judgment delivered by the High Court liable to be set aside - ONGC held not liable to make payment, as rightly decided by the Arbitral Tribunal, to the appellant but the payment shall have to be made by the respondent, who had given a sub- contract to the appellant - Majority view of the Arbitral Tribunal on the above issue confirmed and the view of the High Court is not accepted.
Topic(s)-Arbitration - Privity of Contract