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GARWARE WALL ROPES LTD. vs. COASTAL MARINE CONSTRUCTIONS & ENGINEERING LTD.

SCR Citation: [2019] 5 S.C.R. 579
Year/Volume: 2019/ Volume 5
Date of Judgment: 10 April 2019
Petitioner: GARWARE WALL ROPES LTD.
Disposal Nature: Appeal Allowed
Neutral Citation: 2019 INSC 511
Judgment Delivered by: Hon'ble Mr. Justice R.F. Nariman
Respondent: COASTAL MARINE CONSTRUCTIONS & ENGINEERING LTD.
Case Type: CIVIL APPEAL /3631/2019
Order/Judgment: Judgment
1. Headnote

Arbitration and Conciliation Act, 1996: s. 11(4), 11(6) and 11(6A) – Appointment of arbitrator – Arbitration clause contained in a contract not stamped – Effect of – Held: When Supreme Court or the High Court considers an application u/s. 11(4) to 11(6), and comes across an arbitration clause in an agreement or conveyance which is unstamped, the Court must impound the instrument which is unstamped and hand it over to the authority under the Stamp Act, who would decide issues qua payment of stamp duty and penalty as expeditiously as possible, within the stipulated period – As soon as stamp duty and penalty are paid on the instrument, any of the parties can bring the instrument to the notice of the Court, which would then dispose of the application u/s. 11 – Harmonious construction is to be given to the provisions of the Stamp Act and s. 11(13) of the 1996 Act by which, if it is possible, both provisions ought to be subserved – Furthermore, introduction of s. 11(6A) does not, in any manner, deal with or get over the basis of the judgment in SMS Tea Estates’s case that the mandatory provisions contained in the Stamp Act are applicable to judicial authorities acting u/s. 11, continues to apply even after the amendment of s. 11(6A) – On facts, the arbitration clause contained in the sub-contract would not “exist” as a matter of law until the sub-contract is duly stamped – Order passed by the High Court allowing the application u/s. for appointment of the arbitrator, to adjudicate upon the dispute, even though the sub-contract was unstamped, is set aside and matter is remitted back to the High Court – Maharashtra Stamp Act, 1958 – ss. 33 and 34.

2. Case referred
3. Act
  • Arbitration and Conciliation Act, 1996 (26 of 1996)
4. Keyword
  • Arbitration and Conciliation Act
  • 1996
  • s. 11(4)
  • 11(6) and 11(6A)
  • Appointment of arbitrator
  • Arbitration clause not stamped
  • Effect of
5. Equivalent citation
    Citation(s) 2019 AIR 2053 = 2019 (9) SCC 209 = 2019 (9) Suppl. SCC 209 = 2019 (6) SCALE 250