In Brief
A charitable trust executed a 38-year lease deed with a developer to construct a community hall. Later, the developer invoked an arbitration clause after the trust sued him in court. The High Court appointed an arbitrator despite finding the lease deed was insufficiently stamped. The Supreme Court reversed this decision, holding that a court cannot enforce an arbitration clause in an insufficiently stamped document unless the stamp duty and penalty are first paid. Since the developer failed to pay the required deficit stamp duty of over ₹1 crore as directed by the High Court's Registrar, the arbitrator's appointment was improper and set aside.
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