In Brief
Icomm Tele Ltd challenged a tender condition that required a 10% deposit before invoking arbitration against Punjab State Water Supply & Sewerage Board. The Supreme Court held that while preventing frivolous claims is legitimate, a mandatory pre-deposit requirement unjustly deters parties from accessing arbitration—an alternative dispute resolution process. In contracts of adhesion with unequal bargaining power, such onerous conditions can be struck down. The arbitrator retains sufficient power to dismiss frivolous claims and impose exemplary costs during proceedings. The Court allowed the appeal, invalidating the deposit requirement.
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