In Brief
Ellora Paper Mills supplied cream wove and duplicating paper to Madhya Pradesh but faced payment disputes and wrongful rejection. After failed court proceedings, the parties were referred to arbitration by a Stationery Purchase Committee composed of state officers. Ellora challenged the tribunal's eligibility under Section 12(5) of the Arbitration Act (2015 Amendment), which bars persons with ties to the parties. The High Court dismissed the challenge, holding the amendment did not apply retroactively. The Supreme Court allowed the appeal, holding that Section 12(5) applies substantively to eliminate arbitral ineligibility regardless of prior agreements or participation in proceedings. The Court appointed a retired Supreme Court Judge as the fresh arbitrator to resolve the 22-year-old dispute.
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