While the entire Indian legal fraternity was digesting the constitutional bench decision in Bharat Aluminum Case (setting aside the Bhatia International case), Bombay High Court on 14th September 2012, made an application for interim reliefs absolute in an anti-arbitration injunction suit against a foreign party restraining them from ‘dragging’ a noncontractual party to an arbitration agreement into an international arbitration.

A foreign party had entered into a contract with an Indian party for providing certain services. The contract had an arbitration clause wherein parties had agreed that the arbitration was to be conducted in accordance with the rules of conditions and arbitration of International Chamber of Commerce. Disputes arose and the foreign party invoked the ICC arbitration clause contained in the contract. Surprisingly, while filing their request for arbitration, the foreign party joined the principals/parent company of the Indian Company as a party Respondent under the pretext that their principals had participated in the pre-contractual negotiations with the foreign party. The foreign party contested the maintainability of such a proceeding as they, were not amenable to the territorial jurisdiction of Bombay High Court. Further, it was also contested that in view of the facts of the case, ICC arbitral tribunal has the jurisdiction and is the appropriate forum to rule on the existence of the arbitration agreement between the parties and not the Bombay High Court.

After perusing plethora of judgments and articles cited by parties, and weighing the extensive contentions and propositions made by parties for four days of continuous hearing, Mr. Justice Gavai passed the order restraining the foreign company from proceeding with the arbitration proceedings qua the Plaintiffs. The Plaintiffs were represented by Juris Corp and the foreign company by Ajit Anekar.