SBI General Insurance Co. Ltd v. Krish Spinning

filed by the plaintiff. On 27.10.2021, summons were directed to be issued in the suit and an interim order was passed.

10. Thereafter, instant application under Section 8 of the 1996 Act was preferred by the defendant no. 1 to refer the parties to the arbitration and notice was directed to be issued on the said application on 24.11.2021.

11. Mr. Ashish Dholakia, learned senior counsel assisted by Mr. Tarang Signature Not Verified Signed By:DEEPAK BISSYAN Signing Date:13.05.2025 10:50:56 4 Signature Not Verified Signed By:PURUSHAINDRA KUMAR KAURAV Gupta, submits that the instant civil suit is barred by the provisions of Section 5 of the 1996 Act, which prohibits any intervention by the judicial authority with respect to the matters governed by Part I of the 1996 Act. According to him, the parties agreed to settle all their disputes in India in accordance with the provisions of the 1996 Act and therefore, the instant civil suit is a complete misuse of the remedy. Learned senior counsel also submits that Section 5 of the 1996 Act acts as an absolute bar in law against the exercise of powers by a judicial authority and imposes a blanket ban on judicial intervention of any type in the arbitral process, except in accordance with the provisions of Part I of the 1996 Act. He then contends that the instant civil suit does not fall under any of the exceptions envisaged in Part I of the 1996 Act.

12. According to him, the alleged cause in this suit does not exist within the Indian legal framework. The parties are strictly bound by a specific clause in the arbitration agreement unless a legal declaration explicitly overturns it. The arbitration clause, which was mutually agreed upon, cannot be waived by virtue of certain proceedings which have been undertaken in a foreign country. He gives a comprehensive demonstration of proceedings and then contends that even in some of the proceedings, the plaintiff himself had conceded to the applicability of arbitration proceedings under the 1996 Act.

13. To substantiate his submission, strength is drawn from the decisions of the Supreme Court in the case of In re: Interplay between Arbitration Agreements under the Arbitration and Conciliation Act, 1996 and the Signature Not Verified Signed By:DEEPAK BISSYAN Signing Date:13.05.2025 10:50:56 5 Signature Not Verified Signed By:PURUSHAINDRA KUMAR KAURAV Indian Stamp Act, 18991, SBI General Insurance Co. Ltd. v. Krish Spinning2, Sushma Shivkumar Daga v. Madhurkumar Ramkrishnaji Bajaj3, National Aluminium Company Limited v. Subhash Infra Engineers Private Limited4 and Kvaerner Cementation India Ltd. v. Bajranglal Agarwal5.

14. Learned senior counsel further submits that the Full Bench of the Bombay High Court in the case of JS Oceanliner v. MV Golden Progress6 has held that an application under Section 9 of the 1996 Act seeking the arrest of the vessel is not maintainable in law and the parties are required to file a substantive suit making a monetary claim and to seek interim measures of arrest of the vessel. He, therefore, explains that in the instant case, if certain proceedings had been instituted under the Panamanian law before the Maritime Court, the same would have been only for the limited purpose of securing the arrest of the vessel. In any case, learned senior counsel explains that if that is the only reason for the plaintiff to institute the civil suit, the same plea can very well be looked into by the Arbitral Tribunal once the substantive proceedings before the Arbitral Tribunal are commenced.

15. To support his contention, the learned senior counsel further places reliance on the decision of the Bombay High Court in the case of Siem Offshore v. Altus7 and Altus v. Siem Offshore8, wherein, the Bombay High Court has relied upon the decision in the case of JS Oceanliner. The

filed by the plaintiff. On 27.10.2021, summons were directed to be issued in the suit and an interim order was passed.

10. Thereafter, instant application under Section 8 of the 1996 Act was preferred by the defendant no. 1 to refer the parties to the arbitration and notice was directed to be issued on the said application on 24.11.2021.

11. Mr. Ashish Dholakia, learned senior counsel assisted by Mr. Tarang Signature Not Verified Signed By:DEEPAK BISSYAN Signing Date:13.05.2025 10:50:56 4 Signature Not Verified Signed By:PURUSHAINDRA KUMAR KAURAV Gupta, submits that the instant civil suit is barred by the provisions of Section 5 of the 1996 Act, which prohibits any intervention by the judicial authority with respect to the matters governed by Part I of the 1996 Act. According to him, the parties agreed to settle all their disputes in India in accordance with the provisions of the 1996 Act and therefore, the instant civil suit is a complete misuse of the remedy. Learned senior counsel also submits that Section 5 of the 1996 Act acts as an absolute bar in law against the exercise of powers by a judicial authority and imposes a blanket ban on judicial intervention of any type in the arbitral process, except in accordance with the provisions of Part I of the 1996 Act. He then contends that the instant civil suit does not fall under any of the exceptions envisaged in Part I of the 1996 Act.

12. According to him, the alleged cause in this suit does not exist within the Indian legal framework. The parties are strictly bound by a specific clause in the arbitration agreement unless a legal declaration explicitly overturns it. The arbitration clause, which was mutually agreed upon, cannot be waived by virtue of certain proceedings which have been undertaken in a foreign country. He gives a comprehensive demonstration of proceedings and then contends that even in some of the proceedings, the plaintiff himself had conceded to the applicability of arbitration proceedings under the 1996 Act.

13. To substantiate his submission, strength is drawn from the decisions of the Supreme Court in the case of In re: Interplay between Arbitration Agreements under the Arbitration and Conciliation Act, 1996 and the Signature Not Verified Signed By:DEEPAK BISSYAN Signing Date:13.05.2025 10:50:56 5 Signature Not Verified Signed By:PURUSHAINDRA KUMAR KAURAV Indian Stamp Act, 18991, SBI General Insurance Co. Ltd. v. Krish Spinning2, Sushma Shivkumar Daga v. Madhurkumar Ramkrishnaji Bajaj3, National Aluminium Company Limited v. Subhash Infra Engineers Private Limited4 and Kvaerner Cementation India Ltd. v. Bajranglal Agarwal5.

14. Learned senior counsel further submits that the Full Bench of the Bombay High Court in the case of JS Oceanliner v. MV Golden Progress6 has held that an application under Section 9 of the 1996 Act seeking the arrest of the vessel is not maintainable in law and the parties are required to file a substantive suit making a monetary claim and to seek interim measures of arrest of the vessel. He, therefore, explains that in the instant case, if certain proceedings had been instituted under the Panamanian law before the Maritime Court, the same would have been only for the limited purpose of securing the arrest of the vessel. In any case, learned senior counsel explains that if that is the only reason for the plaintiff to institute the civil suit, the same plea can very well be looked into by the Arbitral Tribunal once the substantive proceedings before the Arbitral Tribunal are commenced.

15. To support his contention, the learned senior counsel further places reliance on the decision of the Bombay High Court in the case of Siem Offshore v. Altus7 and Altus v. Siem Offshore8, wherein, the Bombay High Court has relied upon the decision in the case of JS Oceanliner. The