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33. By placing a strong reliance on the decision of this Court in Cox and Kings Ltd. v. SAP India Pvt. Ltd. reported in (2024) 4 SCC 1, the counsel submitted that the settled position is that the referral court should leave it for the Arbitral Tribunal to decide whether the non-signatory party is indeed a party to the arbitration agreement on the basis of factual evidence and application of legal doctrine. He submitted that the Delhi and Bombay High Courts have consistently taken a view to refer the parties, including the non- signatories to arbitration in DLF Ltd. v. PNB Housing Finance Ltd. reported in (2024) SCC OnLine Del 2165, Moneywise Financial Services (P) Ltd. v. Dilip Jain reported in (2024) SCC OnLine Del 1896 and Cardinal Energy and Infra Structure Pvt. Ltd. v. Subramanya Construction & Development Co. Ltd. reported in (2024) SCC OnLine Bom 964 by relying on this Court’s decision in Cox and Kings (supra).

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169. In case of joinder of non-signatory parties to an arbitration agreement, the following two scenarios will prominently emerge : first, where a signatory party to an arbitration agreement seeks joinder of a non-signatory party to the arbitration agreement; and second, where a non- signatory party itself seeks invocation of an arbitration agreement. In both the scenarios, the referral court will be required to prima facie rule on the existence of the arbitration agreement and whether the non-signatory is a veritable party to the arbitration agreement. In view of the complexity of such a determination, the referral court should leave it for the Arbitral Tribunal to decide whether the non- signatory party is indeed a party to the arbitration agreement on the basis of the factual evidence and application of legal doctrine. The Tribunal can delve into the factual, circumstantial, and legal aspects of the matter to decide whether its jurisdiction extends to the non-signatory party. In the process, the Tribunal should comply with the requirements of principles of natural justice such as giving opportunity to the non-signatory to raise objections with regard to the jurisdiction of the Arbitral Tribunal. This interpretation also gives true effect to the doctrine of competence-competence by leaving the issue of determination of true parties to an arbitration agreement to be decided by the Arbitral Tribunal under Section 16.

170. In view of the discussion above, we arrive at the following conclusions:

xxx xxx xxx (170.12) At the referral stage, the referral court should leave it for the Arbitral Tribunal to decide whether the non- signatory is bound by the arbitration agreement […]” (Emphasis supplied)

64. Therefore, on the pivotal issue whether the non-signatories can be referred to arbitration, this Court took the view that the referral court is required to prima facie rule on the existence of the arbitration agreement and whether the non-signatory party is a veritable party to the arbitration agreement. However, recognising the complexity of such a determination, the arbitral tribunal was considered the proper forum since it can decide whether the non-signatory is a party to the arbitration agreement on the basis of factual evidence and application of legal doctrine. In this process, the non- signatory must also be given an opportunity to raise objections regarding the jurisdiction of the arbitral tribunal in accordance with the principles of natural justice.

84. It is presumed that the formal signatories to an arbitration agreement are parties who will be bound by it.

However, in exceptional cases persons or entities who have not signed or formally assented to a written arbitration agreement or the underlying contract containing the arbitration agreement may be held to be bound by such agreement. As mentioned in the preceding paragraphs, the doctrine of privity limits the imposition of rights and liabilities on third parties to a contract. Generally, only the parties to an arbitration agreement can be subject to the full effects of the agreement in terms of the reliefs and remedies because they consented to be bound by the arbitration agreement. Therefore, the decisive question before the Courts or tribunals is whether a non-signatory consented to be bound by the arbitration agreement. To determine whether a non-signatory is bound by an arbitration agreement, the Courts and tribunals apply typical principles of contract law and corporate law. The legal doctrines provide a framework for evaluating the specific contractual language and the factual settings to determine the intentions of the parties to be bound by the arbitration agreement. [ Gary Born, International Arbitration Law and Practice, (3rd Edn., 2021) at p. 1531.] xxx xxx xxx