ELP Arbitration Weekly Update

This week we have analyzed the decision of the Supreme Court in Cheran Properties Limited v. Kasturi and Sons Limited, wherein the Court was called upon to decide the following issues:
a. Whether a party which is neither a party to the arbitration agreement, nor a party in the arbitral proceedings, can be bound by the Award;
b. Whether proceedings for enforcement of an Award would be maintainable before the NCLT.

The court, placing reliance on the decision of Chloro Controls and section 35 of the Arbitration and Conciliation Act, 1996, held that the Appellant would be bound by the Award even though it was not a party to the arbitration agreement, nor a party in the arbitral proceedings. The Court also held that the Respondent may approach the NCLT for effective enforcement of the Award.