The recent judgment by the Supreme Court of India in the case of Sushma Shivkumar Daga & Anr. v/s Madhurkumar Ramkrishnaji Bajaj & Ors.
Civil Appeal No.1854 of 2023, revolved around the question of whether the matter should be referred to arbitration or not, particularly in the context of the cancellation of a Conveyance Deed and Development Agreements.
The ruling of the Hon’ble Court established that the cancellation of a deed constitutes an action in personam rather than in rem, thereby rendering it arbitrable. This distinction is crucial as it determines whether the dispute can be resolved through arbitration or if it falls within the exclusive jurisdiction of public fora such as courts and tribunals.
This judgment emphasized the principle that every civil or commercial dispute, whether contractual or non-contractual, which can be decided by a court, is in principle capable of being adjudicated and resolved by arbitration, unless the jurisdiction of the Arbitral Tribunals is expressly or impliedly excluded. Furthermore, the Apex Court highlighted that certain categories of cases may stand excluded from the purview of private fora, and where the cause/dispute is non-arbitrable, in such cases the court will refuse to refer the parties to arbitration, even if they have agreed upon arbitration as the forum for settlement of such disputes.
In conclusion, this decision of the Hon’ble Supreme Court established that the relief sought under the Specific Relief Act for the cancellation of a document is an action in personam and not in rem, thereby affirming its arbitrability. Moreover, the Apex Court’s analysis in this case also addressed objections raised regarding the absence of an arbitration clause in the Conveyance Deed and the development agreements. It emphasized that objections to arbitration can be genuine, such as when there is no arbitration clause or when the matter is itself non-arbitrable, but the scope of judicial scrutiny at the such stage in the arbitration applications is extremely limited.

Author of this article:
Adv. Ravish Bhatt,
Partner, R&D Law Chambers,
Dual Qualified Lawyer Solicitor | International Tax Affiliate

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