Summary
The Belgian group company could not be compelled to arbitrate merely because it belonged to the same corporate group as the Indian signatory. The applicant failed to establish its assent or that the negotiator represented it; he was an employee of the Indian company. The application failed against the foreign respondent, but on the Indian respondent’s express agreement the Court appointed a sole arbitrator for domestic commercial arbitration between the two Indian parties.
Issues
- Whether the non-signatory Belgian company intended to be bound by the arbitration agreement.
- Whether an arbitrator could nevertheless be appointed for the domestic dispute.
Held
- The group-of-companies inquiry concerned a mutually held intention to bind the non-signatory; shared group membership alone did not establish consent. (¶¶ 1–4, 9)
- The applicant’s case depended on attributing the negotiator’s actions to respondent 2, but the material showed he acted as respondent 1’s employee. The applicant did not discharge its burden to establish respondent 2’s assent, including for the supplier-group indemnity clause. (¶ 5–9)
- The asserted post-contract correspondence did not establish respondent 2’s participation or cure the failed premise concerning the negotiator’s authority. The proposed international-arbitration basis accordingly failed. (¶ 10–12)
- Respondent 1 expressly accepted appointment by this Court for domestic arbitration, permitting appointment between the applicant and respondent 1 despite dismissal against respondent 2. (¶ 12–13)
Result
Application dismissed against respondent 2. Justice Badar Durrez Ahmed, former Chief Justice of the Jammu & Kashmir High Court, appointed sole arbitrator for domestic commercial arbitration at New Delhi between the applicant and respondent 1 under the 1996 Act. No costs; pending interim applications disposed of.