In Brief
An Indian multinational hotel group sought appointment of a sole arbitrator to resolve disputes with a hotel operator over unpaid management fees and wrongful termination of a Hotel Management Agreement (HMA). The respondent challenged the arbitration clause, arguing the HMA was unstamped or insufficiently stamped under Indian stamp law. The Supreme Court held that where stamp duty has been paid (though its adequacy is disputed), courts must refer the matter to arbitration at the pre-appointment stage. The arbitration agreement is separate from and independent of the substantive contract under the doctrine of separability; stamp duty defects in the commercial contract do not invalidate the arbitration agreement unless there is complete non-stamping. The Court appointed an arbitrator, deferring the stamp duty adequacy question to later proceedings.
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