The Hon’ble Delhi High Court relying on the judgment passed in Dolphin Drilling Limited vs ONGC AIR 2020 SC1296, passed directions with respect to the issue of multiplicity in arbitral proceedings. The Hon’ble Justice Prathiba M. Singh while hearing the petition Gammon India Limited and Another vs National Highways Authority of India observed that arbitration is supposed to be a solution for litigation flaws. However, arbitration subject to alternate dispute resolution mechanism has become complex, owing to several reasons viz. Long delays, challenges in enforcement, high costs etc. The Hon’ble Justice emphasized that another reason rendering arbitral processes complex is ‘Multiplicity’ i.e. multiple invocations, multiple references, multiple Arbitral Tribunals, multiple Awards and challenges between the same parties in respect to same contracts or same series of contracts.
The Hon’ble Court observed that both judiciary and legislatures has taken efforts to make sure that the arbitral proceedings are not being misused by the parties. Parties to arbitration are expected to practice bona fide discipline while availing arbitral procedure. In order to avoid multiplicity of Tribunal and inconsistent or contradictory Awards the Hon’ble Justice passed the following directions:
- In every petition under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter, “Section 34 petition”), the parties approaching the Court ought to disclose whether there are any other proceedings pending or adjudicated in respect of the same contract or series of contracts and if so, what is the stage of the said proceedings and the forum where the said proceedings are pending or have been adjudicated.
- At the time when a Section 34 petition is being heard, parties ought to disclose as to whether any other Section 34 petition in respect of the same contract is pending and if so, seek disposal of the said petitions together in order to avoid conflicting findings.
- In petitions seeking appointment of an Arbitrator/Constitution of an Arbitral Tribunal, parties ought to disclose if any Tribunal already stands constituted for adjudication of the claims of either party arising out of the same contract or the same series of contracts. If such a Tribunal has already been constituted, an endeavor can be made by the arbitral institution or the High Court under Section 11, to refer the matter to the same Tribunal or a single Tribunal in order to avoid conflicting and irreconcilable findings.
- Appointing authorities under contracts consisting of arbitration clauses ought to avoid appointment or constitution of separate Arbitrators/ Arbitral Tribunals for different claims/disputes arising from the same contract, or same series of contracts.
The order passed will be sent to Registrar General to present it before Hon’ble Chief Justice for considering any modifications required to be made in the Rules of the Delhi High Court framed under the Arbitration and Conciliation Act, 1996. The order will also be sent to Secretary, Ministry of Law and Justice, Government of India and the Chairman, National Authority of India.