BHARAT SANCHAR NIGAM LTD. versus TELEPHONE CABLES LTD.

BHARAT SANCHAR NIGAM LTD. versus TELEPHONE CABLES LTD.

There was no arbitration agreement between the parties applicable to the dispute over tender-stage or non-placed purchase order quantities; the arbitration clause became part of the contract only when a purchase order was placed, and thus, the application under section 11 of the Arbitration and Conciliation Act, 1996 was not maintainable.

Parties
Appellant: Bharat Sanchar Nigam Ltd.; Respondent: Telephone Cables Ltd.
Jurisdiction
India
Judgment Date
22 January 2010
Procedural Posture
Civil Appeal / Supreme Court Appeal From High Court Order on Appointment of Arbitrator Under Arbitration and Conciliation Act, 1996
Outcome
Appeal allowed
Legal Topics
Arbitration Agreement Existence, Tender Process, Vendor Rating, Jurisdiction for Tender Disputes, Observations Reserving Liberty to Litigate, Public Undertakings and Litigation
Arbitration Government Contracts Public Law Arbitration Agreement Existence Tender Process Vendor Rating Jurisdiction for Tender Disputes Observations Reserving Liberty to Litigate +1 more

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Parties

Bharat Sanchar Nigam Ltd.

Appellant

Telephone Cables Ltd.

Respondent

Procedural Posture

Civil Appeal / Supreme Court Appeal From High Court Order on Appointment of Arbitrator Under Arbitration and Conciliation Act, 1996

Legal Issues

  1. 1 Whether an arbitration agreement existed between the parties in respect of tender-stage disputes
  2. 2 Whether the respondent could invoke arbitration after availing public law remedy
  3. 3 Implications of court observations reserving liberty to seek further remedies

Ratio Decidendi

There was no arbitration agreement between the parties applicable to the dispute over tender-stage or non-placed purchase order quantities; the arbitration clause became part of the contract only when a purchase order was placed, and thus, the application under section 11 of the Arbitration and Conciliation Act, 1996 was not maintainable.

Court Disposition

Appeal allowed

Orders

  • Order of High Court appointing arbitrator under section 11 of Arbitration and Conciliation Act, 1996 set aside
  • Application under section 11 of Arbitration and Conciliation Act, 1996 dismissed