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Vidya Drolia vs Durga Trading Corporation on 14 December, 2020

62. The issue as to "who decides arbitrability ?" fell for consideration before the Hon'ble Supreme Court in the case of Vidya Drolia v. Durga Trading Corpn.14. The decision on the aforesaid issue was summed up under various sub-paragraphs of paragraph 154 of the said reports wherein it was held that the scope of judicial review and jurisdiction of the Court under Section 8 and 11 of the Arbitration Act is identical but extremely limited and restricted. It was further held that the arbitral tribunal is the preferred first 14 (2021) 2 SCC 1 Page 18 of 22 2026:CHC-AS:256 authority to determine and decide all questions of non-arbitrability and the Court has been conferred power of second look on aspects of non- arbitrability post the award in terms of sub-clauses (i),(ii) or (iv) of Section 34(2)(a) or sub-clause (i) of Section 34(2)(b) of the Arbitration Act. It was further held that rarely as a demurer the Court may interfere at Section 8 or 11 stage when it is manifestly and ex facie certain that the arbitration agreement is non-existent, invalid or the disputes are non-arbitrable, though the nature and facet of non-arbitrability would to some extent, determine the level and nature of the judicial scrutiny. The restricted and limited review is to check and protect parties form being forced to arbitrate when the matter is demonstrably "non-arbitrable" and to cut off the deadwood. The Court by default would refer the matter when contentions relating to non-arbitrability are plainly arguable; when consideration in summary proceedings would be insufficient and inconclusive; when facts are contested; when the party opposing arbitration adopts delaying tactics or impairs conduct of arbitration proceedings. It was further held that this is not the stage for the Court to enter into mini trial or elaborate review so as to usurp the jurisdiction of the arbitral tribunal but to afirm and uphold the integrity and efficacy of arbitration as an alternative dispute resolution mechanism.
Supreme Court of India Cites 132 - Cited by 615 - S Khanna - Full Document
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