In Brief
Cox and Kings Limited sought arbitrator appointment against SAP India Private Limited and its parent SAP SE for alleged wrongful contract termination and sought to bind the non-signatory parent to arbitration under the group of companies doctrine. The Supreme Court, while examining whether non-signatories can be bound to arbitration agreements, doubted the correctness of the Chloro Controls judgment and the group of companies doctrine as applied in Indian law. The Court noted that the doctrine appears based on economic convenience rather than sound legal principles and fails to adequately safeguard party autonomy and separate corporate personality. The matter was referred to a larger bench to clarify the applicability of 'claiming through or under' language in the Arbitration Act to the group of companies doctrine and to determine whether the doctrine is valid in law.
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