Paragraph numbers below are the court’s original numbering, recovered from the source text.
1. I have had the advantage of going through an elaborate, well considered and scholarly drafted judgment proposed by my esteemed Sister Justice Indu Malhotra.
2. I entirely agree with the reasoning and the conclusion, which my erudite Sister has drawn, which are based on remarkably articulate process of reasoning. However, having regard to the nature of the controversy involved in these appeals, I wish to add a few words of mine.
3. As rightly observed by my learned Sister in para 8, following two questions arise for consideration in these appeals:
4. One, whether the arbitration agreement in question is a bi- party agreement between the MTNL(appellant herein) and Canara Bank (respondent No. 1) or it is a tri-partite agreement between the MTNL, Canara Bank and CANFINA (respondent No. 2) and, if so, whether the agreement satisfies the conditions laid down in Section 7(4)(b) and (c) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as “the Act”) so as to enable the arbitral tribunal to decide the dispute which has arisen between these parties in relation to the agreement.
5. Second, if the answer to the first question is that the agreement in question is a tri-partite agreement, whether CANFINA is also a necessary party to the arbitral proceedings for deciding the rights of the parties inter se in relation to the dispute.
6. In my considered opinion also, the agreement in question is essentially a tri-partite agreement between the parties, namely, MTNL, Canara Bank and CANFINA. Indeed, this is clear from the documents exchanged between the parties, pleadings and orders of the Court.
7. It is also clear when one examines the nature of the dispute. It is so inextricably linked between the three parties that it can be effectively decided only when all the three parties are made parties to the arbitral proceedings.
8. Once we examine the issue on facts in the light of requirements of Section 7(4)(b) and (c) of the Act, we have no hesitation in coming to a conclusion that the agreement in question is, in fact, a tri-partite agreement between the three parties mentioned above. In my view, it satisfies the requirements of Section 7(4)(b) and (c) of the Act.
9. This issue is extensively dealt with by my learned Sister in the light of law laid down by this Court in several decisions and I agree with her reasoning.
10. Somewhat similar question also arose in international arbitrations as to when there are more than two parties in a dispute then how such dispute should be dealt with in the arbitral proceedings- whether it should be dealt with in one arbitral proceedings between one set of parties or it should be dealt with in separate or parallel arbitration proceedings.
11. This question was succinctly dealt with by the learned Authors- Alan Redfern and Martin Hunter in their book on “International Arbitration”. (see – Redfern and Hunter on International Arbitration – sixth edition-under the heading ‘J’ “Multiparty Arbitrations” (a) to (e) 2.212 to 2.247 pages 141 to 153).
12. The learned authors examined the aforementioned question in the context of ICC and AAA Rules, decisions rendered by English Court of appeal and the reports of ICC Commission on multi-party arbitration. They opined that subject to the terms of the agreement and any rules framed in that behalf, it is desirable that such disputes should be resolved as far as possible in one arbitral proceedings to avoid any inconsistent findings and parallel arbitral proceedings.
13. Since the main object of the arbitral proceedings is to decide the disputes expeditiously and within a time frame, this object can be MAHANAGAR TELEPHONE NIGAM LTD. v. CANARA BANK [ABHAY MANOHAR SAPRE, J.] achieved only when the disputes are resolved as far as possible in one arbitral proceedings. In this case, this object can be achieved only when all the three parties named above are made party in one arbitral proceedings to enable the arbitral tribunal to finally decide the dispute on merits in accordance with law.
14. As rightly observed by my learned Sister, the undisputed facts brought on record, in clear terms, entitles this Court to invoke the well known doctrine of “Group of Companies” and apply its principle to the facts of this case so as to enable the arbitral tribunal to determine the rights of three parties named above. In my considered view, one cannot dispute the legal proposition the doctrine “Group of Companies” has its application to arbitral proceedings and, in appropriate cases, it can be so applied (See-Redfern and Hunter on International Arbitration – Sixth Edition – 1.115 page 33, 2.42- 2.51 pages 85 to 88)
15. In view of what I have said above, I respectfully agree with the reasoning and the conclusion of my learned sister. Nidhi Jain Appeals partly allowed.