No Jurisdiction Challenge After Submitting Statement of Defence : Supreme Court
The Hon’ble Supreme Court in M/S Vidyawati Construction Company v. Union of India reaffirmed that an arbitral tribunal’s jurisdiction cannot be challenged after the submission of the statement of defence.
A bench of Justices Abhay S. Oka and Ujjal Bhuyan ruled on a case where the respondent objected to the tribunal’s jurisdiction post-submission of its defence. The tribunal rejected the objection and proceeded with the award, but the District Judge set it aside, a decision later upheld by the Allahabad High Court.
Referring to Section 16(2) of the Arbitration & Conciliation Act, 1996, the Appellant argued that the respondent, by accepting the arbitrator’s appointment and modifying its defence, had waived the right to challenge jurisdiction. Justice Oka, in his judgment, held that raising such objections belatedly was impermissible. The Court set aside the High Court’s ruling, stating that courts under Sections 34 and 37 erred in upholding the respondent’s objection.
Accordingly, the appeal was allowed.