In Brief
NALCO, a Government enterprise, issued a tender for construction work. Subhash Infra (the contractor) submitted a bid that NALCO accepted and issued a work order. The contractor later refused to perform, claiming the contract was not binding. NALCO invoked arbitration and appointed an arbitrator. The contractor sued for a declaration that the arbitrator's appointment was void and obtained an injunction from the High Court. The Supreme Court held that objections to an arbitration agreement's validity must be raised before the arbitrator under Section 16 of the Arbitration Act, not through civil court suits. The Court set aside the injunction, quashed the arbitrator's appointment (due to his prior relationship with NALCO), and appointed a retired High Court judge as the new arbitrator.
The lawyer headnote and full judgment text are available to registered users.