Office for Alternative Architecture v. Ircon Infrastructure and Services Ltd.
Background
The dispute arose from the Delhi High Court's order appointing an arbitral tribunal under Section 11 of the Arbitration Act, but which also went further and excluded certain of the appellant's claims from arbitration, treating them as "non-arbitrable" or "excepted" matters under the parties' contract. The appellant challenged only this exclusion, arguing that at the stage of appointing an arbitrator, a court should not be deciding which claims can or cannot be arbitrated.
Decision Breakdown
The Supreme Court held that under Section 11(6A), a court's role at the arbitrator-appointment stage is confined strictly to examining whether an arbitration agreement exists. It should not go further and adjudicate which specific claims are arbitrable. Relying on a seven-judge bench ruling ("In Re: Interplay") and a subsequent three-judge bench ruling ("SBI General Insurance v. Krish Spinning"), the Court held that the Delhi High Court erred in splitting the appellant's claims into arbitrable and non-arbitrable categories at the referral stage. It set aside that portion of the High Court's order and allowed the parties to raise the arbitrability of specific claims before the arbitral tribunal itself.
Lesson Learnt
When approaching a court to appoint an arbitrator, only the existence of a valid arbitration agreement is examined at that stage: questions about whether particular claims can actually be arbitrated are left for the arbitrator to decide, not the court.