In Brief
A water supply company challenged a demand notice for enhanced water tariffs issued by the Karnataka Urban Water Supply Board. The High Court dismissed the challenge, relying on Clause 11 of the agreements which provided for dispute resolution by the Chief Engineer. The Supreme Court set aside both judgments, holding that Clause 11 does not constitute a valid arbitration agreement because the Chief Engineer, being the Board's employee, lacks the impartiality and independence required of an arbitrator under the Arbitration Act 1996. The Court restored the writ petition for decision on merits by the High Court.
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