ASF Buildtech v. Shapoorji Pallonji & Co.

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Citations : 2025 INSC 616
Court : Supreme Court of India
Case Number: Civil Appeal No. 5823 of 2025; 2 May 2025
Bench: J.B. Pardiwala, R. Mahadevan, JJ.

Arbitration and Conciliation Act, 1996 – Sections 7, 11, 16, 21, 23, 37 – Power of Arbitral Tribunal to Implead Non-Signatories – Group of Companies Doctrine – Jurisdiction of Arbitral Tribunal – Notice under Section 21 – Competence-Competence Principle.

Held

  1. An arbitral tribunal has the authority to implead or join non-signatories to an arbitration agreement as parties to the proceedings, provided they are found to be bound by the arbitration agreement under the Group of Companies Doctrine or other legal principles establishing their intent or involvement, as laid down in Cox and Kings Ltd. v. SAP India Pvt. Ltd. (2023 SCC OnLine SC 1634). The tribunal’s jurisdiction is derived from the arbitration agreement itself, not merely from the referral court’s order under Section 11 or the procedural act of tribunal constitution. [Paras 139-143]
  2. The doctrine of kompetenz-kompetenz under Section 16 empowers the arbitral tribunal to rule on its own jurisdiction, including the joinder of non-signatories, without dependency on national courts. The tribunal can exercise necessary powers to effectually decide jurisdictional questions, even in the absence of a challenge by the parties. [Paras 134-137]
  3. Non-service of a notice under Section 21 does not nullify the arbitral tribunal’s jurisdiction to implead a non-signatory. Section 21 is procedural, aimed at determining the commencement of arbitral proceedings for limitation purposes under Section 43, and does not restrict the tribunal’s jurisdiction to claims or parties not specified in the notice. Additional claims or counter-claims, including those involving non-signatories, can be raised under Section 23, provided they fall within the scope of the arbitration agreement. [Paras 144-160]
  4. The Group of Companies Doctrine applies where non-signatories are inextricably linked to the performance of the contract, share common management, or demonstrate mutual intent to be bound by the arbitration agreement. In this case, the appellant (ABPL), as part of the ASF Group, was correctly impleaded due to its substantial involvement in the negotiation, performance, and termination of the Works Contract and Settlement Agreement, evidenced by common directorship, shared resources, and representations as a single economic unit. [Paras 162-166]
  5. The High Court’s dismissal of the appellant’s appeal under Section 37, affirming the arbitral tribunal’s rejection of the Section 16 application, was upheld. The tribunal’s findings on the applicability of the Group of Companies Doctrine were supported by material evidence, including correspondence, the Comfort Letter, and the intertwined nature of agreements involving the ASF Group entities. [Paras 161-163]
  6. The Arbitration and Conciliation Act, 1996, lacks express provisions for the tribunal’s power to implead non-signatories, causing procedural uncertainties. The proposed Arbitration and Conciliation Bill, 2024, also fails to address this issue. The Court urged the Ministry of Law and Justice to consider statutory recognition of such power to enhance clarity in arbitration law. [Para 170]

Appeal Dismissed. All legal contentions kept open for adjudication before the arbitral tribunal. [Paras 173-174]

Counsel: Mr. Devadatt Kamat, Senior Advocate (for Appellant); Ms. Aakanksha Kaul, Advocate (for Respondent No. 1).

Facts

  • Parties Involved: ASF Buildtech Pvt. Ltd. (ABPL, Appellant), Shapoorji Pallonji & Co. Pvt. Ltd. (SPCPL, Respondent No. 1), Black Canyon SEZ Pvt. Ltd. (BCSPL, Respondent No. 3), and ASF Insignia SEZ Pvt. Ltd. (AISPL, Respondent No. 2), all part of the ASF Group.
  • Background: BCSPL initiated arbitration against SPCPL under a Settlement Agreement dated 24.07.2020, linked to a Works Contract dated 21.11.2016. SPCPL filed a counter-claim against BCSPL, AISPL, and ABPL, invoking the Group of Companies Doctrine, asserting that all three were bound by the arbitration agreement due to their interconnected roles.
  • Arbitral Tribunal’s Decision: ABPL and AISPL challenged their inclusion as non-signatories via Section 16 applications, which the tribunal dismissed on 23.05.2023 and 17.10.2023, holding that their roles required adjudication as mixed questions of fact and law.
  • High Court Ruling: The Delhi High Court, on 04.07.2024, dismissed ABPL’s appeal under Section 37, affirming the tribunal’s orders. It found that ABPL, AISPL, and BCSPL operated as a single economic unit under the ASF Group, supported by common management, shared resources, and a Comfort Letter from AISPL.
  • Appeal: ABPL appealed to the Supreme Court, arguing that as a non-signatory, it could not be impleaded without a referral court’s direction under Section 11 or a prior notice under Section 21 of the Arbitration and Conciliation Act, 1996.

Issues

  1. Whether an arbitral tribunal has the authority to implead non-signatories to an arbitration agreement?
  2. Whether the non-service of a notice under Section 21 precludes the tribunal from impleading a non-signatory?
  3. Whether the Group of Companies Doctrine was correctly applied to implead ABPL based on its role in the ASF Group?

Holdings

  1. Power to Implead Non-Signatories: The arbitral tribunal has the authority to implead non-signatories if they are bound by the arbitration agreement, as determined by principles like the Group of Companies Doctrine. The tribunal’s jurisdiction stems from the arbitration agreement, not the referral court’s order or procedural formalities. [Paras 139-143]
  2. Section 21 Notice: Non-service of a notice under Section 21 does not nullify the tribunal’s jurisdiction. Section 21 is procedural, fixing the commencement of arbitration for limitation purposes, and does not restrict claims or parties under Section 23, provided they fall within the arbitration agreement’s scope. [Paras 144-160]
  3. Group of Companies Doctrine: The tribunal and High Court correctly applied the doctrine. ABPL’s substantial involvement in the Works Contract and Settlement Agreement, common management, shared resources, and representations as part of the ASF Group justified its impleadment. [Paras 162-166]
  4. No Error by High Court: The High Court’s dismissal of the Section 37 appeal was upheld, as the tribunal’s findings were supported by evidence, including correspondence, the Comfort Letter, and the intertwined nature of agreements. [Paras 161-163]
  5. Statutory Gap: The Court noted the absence of express provisions in the 1996 Act and the proposed 2024 Bill regarding the tribunal’s power to implead non-signatories, urging legislative reform. [Para 170]

Reasoning

  • Jurisdiction and Competence-Competence: Under Section 16, the tribunal can rule on its jurisdiction, including the joinder of non-signatories, per the kompetenz-kompetenz principle. The arbitration agreement, not the referral court’s order, is the source of jurisdiction. [Paras 134-143]
  • Section 21 vs. Section 23: Section 21 serves to mark the start of arbitration for limitation purposes, not to limit claims or parties. Section 23 allows claims and counter-claims, including against non-signatories, if within the arbitration agreement’s scope. Adavya Projects and Praveen Enterprises clarify that additional claims need not be preceded by a Section 21 notice. [Paras 144-160]
  • Group of Companies Doctrine: The Court applied Cox and Kings (I), finding ABPL’s active role in negotiations, performance, and termination, evidenced by shared directorship, ASF Group branding, and contractual assurances, established its intent to be bound. [Paras 162-166]
  • Evidence-Based Decision: The tribunal’s and High Court’s findings were grounded in material evidence, including emails, the Comfort Letter, and the ASF Group’s composite operations, justifying ABPL’s inclusion. [Paras 161-163]
  • Legislative Critique: The lack of statutory clarity on impleadment powers creates procedural uncertainty, unaddressed by the 2024 Bill, necessitating reform. [Para 170]

Disposition

  • Appeal Dismissed: The Supreme Court found no error in the High Court’s judgment. All other legal contentions were left open for the arbitral tribunal. [Paras 173-174]
  • Directions: The judgment was to be forwarded to all High Courts and the Ministry of Law and Justice for consideration in legislative reforms. [Para 175]

Significance

This case clarifies the arbitral tribunal’s authority to implead non-signatories under the Group of Companies Doctrine, reinforces the procedural nature of Section 21, and highlights the need for legislative clarity in India’s arbitration regime. It strengthens the kompetenz-kompetenz principle and aligns with global arbitration trends by prioritizing the arbitration agreement’s scope over procedural formalities.

Below is a list of the case laws discussed in ASF Buildtech Pvt. Ltd. v. Shapoorji Pallonji & Co. Pvt. Ltd. (2025 INSC 616) along with the key observations made by the Supreme Court regarding each case. The observations are summarized to reflect their relevance to the issues addressed in the judgment, particularly concerning the arbitral tribunal’s power to implead non-signatories, the Group of Companies Doctrine, the scope of Sections 7, 11, 16, 21, and 23 of the Arbitration and Conciliation Act, 1996, and related principles.

Cases Referred

1. Cox and Kings Ltd. v. SAP India Pvt. Ltd. & Anr. (2023 SCC OnLine SC 1634)

  • Context: Referred to as Cox and Kings (I), this case is pivotal for its exposition of the Group of Companies Doctrine and the joinder of non-signatories to arbitration proceedings.
  • Observations:
    • Established the framework for determining whether non-signatories are bound by an arbitration agreement, emphasizing mutual intent and substantial involvement in the negotiation, performance, or termination of the underlying contract. [Para 77]
    • Clarified that the tribunal can implead non-signatories if their conduct demonstrates an intent to be bound, as per the Group of Companies Doctrine, which does not require them to be signatories to the arbitration agreement. [Paras 110, 166]
    • The test for non-signatory joinder involves assessing direct, positive, and substantial involvement, not merely incidental participation, aligning with the principle of consent in arbitration. [Para 131]
    • Supported the respondent’s argument that ABPL, AISPL, and BCSPL, as part of the ASF Group, were correctly impleaded due to their interconnected roles and shared intent. [Paras 162, 166]

2. Oil and Natural Gas Corporation Ltd. v. Discovery Enterprises Pvt. Ltd. (2022) 8 SCC 42)

  • Context: Discussed in the context of the Group of Companies Doctrine and the criteria for impleading non-signatories.
  • Observations:
    • Laid down five factors for applying the Group of Companies Doctrine: (i) mutual intent, (ii) direct relationship with the signatory, (iii) commonality of subject matter, (iv) composite transactions, and (v) performance of the contract by the group. These were not satisfied in the case of ABPL, according to the appellant. [Paras 9, 15-18]
    • The Court noted that merely being a holding company does not justify impleadment unless these factors are met, reinforcing the separate corporate personality principle. [Para 16]
    • Contrasted with the present case, where the Court found sufficient evidence of ABPL’s involvement to justify its impleadment under the doctrine. [Para 163]

3. Ajay Madhusudan Patel & Ors. v. Jyotrindra S. Patel & Ors. (2024 SCC OnLine SC 2597)

  • Context: Cited for its clarification on the criteria for impleading non-signatories as “veritable parties” to an arbitration agreement.
  • Observations:
    • Held that a non-signatory’s intent to be bound can be inferred from their participation in the negotiation, performance, or termination of the contract, provided their involvement is positive, direct, and substantial, not merely incidental. [Para 10]
    • The Court found no evidence of such involvement by ABPL, as argued by the appellant, but the tribunal and High Court’s findings of ABPL’s role in the ASF Group’s operations contradicted this. [Paras 9, 11]
    • Reinforced that impleadment must align with principles of consent and cannot be based solely on corporate relationships like being a holding company. [Para 9]

4. Adavya Projects (2023 SCC OnLine SC 1647)

  • Context: Extensively discussed for its interpretation of Sections 16, 21, and the tribunal’s jurisdiction to implead non-signatories.
  • Observations:
    • Held that Section 16 covers all jurisdictional questions, including whether a party is bound by the arbitration agreement, and the tribunal’s jurisdiction is determined by the agreement itself. [Para 137]
    • Clarified that non-service of a Section 21 notice does not bar impleadment of a party, as the notice’s purpose is procedural (to fix the commencement of arbitration for limitation purposes) and does not limit the tribunal’s jurisdiction. [Paras 158-160]
    • Extended the logic of Praveen Enterprises to hold that claims or parties not mentioned in the Section 21 notice can be included in arbitration if covered by the arbitration agreement. [Para 159]
    • Noted that the tribunal’s power to implead depends on whether the person is a party to the arbitration agreement, not on their inclusion in Section 11 proceedings. [Paras 143, 160]

5. State of Goa v. Praveen Enterprises (2012) 12 SCC 581)

  • Context: Cited for its interpretation of Section 21 and the scope of claims and counter-claims in arbitration.
  • Observations:
    • Held that Section 21’s purpose is to determine the commencement of arbitral proceedings for limitation purposes under Section 43, not to restrict claims or counter-claims raised later. [Paras 155, 168]
    • Clarified that additional claims not mentioned in the Section 21 notice can be raised in the statement of claim, with limitation computed from the date they are raised. Counter-claims require no separate Section 21 notice, with limitation reckoned from their filing date unless previously raised in a notice. [Paras 155, 159]
    • Supported the respondent’s argument that ABPL’s impleadment via SPCPL’s counter-claim was valid without a prior Section 21 notice. [Para 168]

6. Milkfood Ltd. v. GMC Ice Cream (P) Ltd. (2004) 7 SCC 288)

  • Context: Referred to for its analysis of Section 21’s purpose and its alignment with international arbitration principles.
  • Observations:
    • Held that Section 21’s primary purpose is to fix the commencement of arbitration for applying the Limitation Act, 1963, and to determine procedural timelines, such as for Section 11 applications or applicable law. [Paras 148, 152]
    • Noted that Section 21 does not mandate a specific notice format or strict content requirements, drawing from UNCITRAL Model Law and English Arbitration Act, 1996. The notice need only indicate the claimant’s intent to arbitrate. [Paras 148, 153]
    • Clarified that Section 21 has no jurisdictional role in limiting claims or parties, supporting the tribunal’s power to entertain claims against non-signatories without a prior notice. [Paras 152-154]

7. Govind Rubber Ltd. v. Louis Dreyfus Commodities Asia (P) Ltd. (2015) 13 SCC 477)

  • Context: Cited for its interpretation of Section 7’s requirements for an arbitration agreement.
  • Observations:
    • Held that a signature is not mandatory for an arbitration agreement under Section 7(4)(b), (c), or (5), and a “party” under Section 2(h) includes non-signatories bound by the agreement. [Para 166]
    • Supported the view that non-signatories like ABPL can be impleaded if their conduct or relationship with the agreement establishes their intent to be bound, as per Cox and Kings (I). [Para 166]

8. Oil and Natural Gas Corporation Ltd. v. Jindal Drilling and Industries Ltd. (2015 SCC OnLine Bom 1707)

  • Context: A Bombay High Court decision representing the view that arbitral tribunals lack the power to implead non-signatories or lift the corporate veil.
  • Observations:
    • Held that an arbitral tribunal cannot lift the corporate veil to implead a non-signatory, as this power resides solely with courts. The tribunal’s jurisdiction is limited to parties to the arbitration agreement. [Para 16]
    • The Supreme Court noted this as a contradictory view among High Courts but did not endorse it, favoring the tribunal’s broader jurisdictional powers under Section 16 and Cox and Kings (I). [Para 15]

9. Balmer Lawrie & Co. Ltd. v. Saraswathi Chemicals Proprietors Saraswathi Leather (2017 SCC OnLine Del 7519)

  • Context: A Delhi High Court decision denying the tribunal’s power to enforce awards against non-parties.
  • Observations:
    • Held that an arbitral tribunal cannot proceed against non-parties to the arbitration agreement, as its jurisdiction is consensual and derived solely from the agreement. Only courts can compel non-signatories to arbitrate in exceptional cases. [Para 19]
    • The Supreme Court acknowledged this as part of the conflicting High Court views but rejected its restrictive approach, affirming the tribunal’s authority to implead non-signatories under the Group of Companies Doctrine. [Para 15]

10. Sudhir Gopi v. Indira Gandhi National Open University & Anr. (2017 SCC OnLine Del 8345)

  • Context: Another Delhi High Court decision limiting the tribunal’s jurisdiction over non-signatories.
  • Observations:
    • Held that an arbitral tribunal cannot lift the corporate veil or implead non-signatories, as its jurisdiction is confined to the arbitration agreement. Courts, not tribunals, can compel non-signatories to arbitrate in exceptional cases. [Para 18]
    • The Supreme Court noted this as part of the divergent judicial opinions but aligned with the broader view of tribunal authority under Adavya Projects and Cox and Kings (I). [Para 15]

11. V.G. Santhosam v. Shanthi Gnanasekaran (2020 SCC OnLine Mad 560)

  • Context: A Madras High Court decision rejecting the tribunal’s power to implead third parties.
  • Observations:
    • Held that the 1996 Act lacks express provisions for impleading third parties, and Section 17 does not permit such actions beyond the agreement’s scope. The tribunal cannot exercise inherent powers like those under Order I Rule 10 of the CPC. [Paras 23-29]
    • Ruled that Section 16 limits the tribunal to ruling on its jurisdiction (existence/validity of the agreement) and does not allow adjudication of third-party civil rights. [Para 25]
    • The Supreme Court recognized this as a restrictive view but favored the tribunal’s competence to implead non-signatories if bound by the agreement, as per Cox and Kings (I) and Adavya Projects. [Para 15]

12. Alupro Building Systems Pvt Ltd. v. Ozone Overseas Pvt Ltd (2017 SCC OnLine Del 7228)

  • Context: A Delhi High Court decision delineating the functions of a Section 21 notice.
  • Observations:
    • Identified multiple purposes of a Section 21 notice, including informing parties of claims, enabling dispute or counter-claim responses, facilitating arbitrator appointments, and fixing the commencement of arbitration for limitation purposes. [Para 159]
    • The Supreme Court agreed that a Section 21 notice is mandatory but clarified that its non-service does not nullify the tribunal’s jurisdiction over a party. The notice’s primary role is procedural, not jurisdictional, and other functions are secondary. [Para 159]

13. M/s Arif Azim Co. Ltd. v. M/s Micromax Informatics Fze

  • Context: Cited for its view on the role of referral courts under Section 11.
  • Observations:
    • Held that referral courts are merely a conduit to arbitration, and the tribunal’s jurisdiction derives from the parties’ choices and intent in the arbitration agreement, not the court’s order. [Para 140]
    • Supported the Court’s finding that the tribunal’s jurisdiction to implead ABPL was not limited by its exclusion from Section 11 proceedings. [Para 140]

14. Gammon India Ltd. v. NHAI (2020 SCC OnLine Del 659)

  • Context: A Delhi High Court decision on the scope of arbitral tribunal jurisdiction post-appointment.
  • Observations:
    • Held that once appointed, the arbitral tribunal is a “one-stop forum” for adjudicating all disputes, and the referral court’s role under Section 11(6A) is limited to examining the existence of the arbitration agreement. [Para 164]
    • Reinforced the Supreme Court’s view that the tribunal could decide on ABPL’s impleadment without further referral court intervention. [Para 164]

15. Chloro Controls India Pvt. Ltd. v. Severn Trent Water Purification Inc. (2013) 1 SCC 641)

  • Context: Referenced for its initial articulation of the Group of Companies Doctrine.
  • Observations:
    • Recognized that non-signatories could be compelled to arbitrate if they claim through signatories or show clear intent to be bound, but this power was initially seen as vested in courts, not tribunals. [Para 62]
    • The Supreme Court noted that Cox and Kings (I) rectified misconceptions in Chloro Controls by affirming the tribunal’s authority to implead non-signatories under the doctrine. [Para 62]

16. Gayatri Balasamy v. M/s ISG Novasoft Technologies Ltd., 2025 INSC 605

  • Context: Cited for its commentary on the need for clarity in arbitration law.
  • Observations:
    • Observed that uncertainty in arbitration law is detrimental to business and commerce, supporting the Court’s call for legislative reform to address the lack of statutory provisions on tribunal impleadment powers. [Para 170]
    • Highlighted the need for the Arbitration and Conciliation Bill, 2024, to include clear provisions on this issue. [Para 170]

Additional Notes

  • The Supreme Court extensively analyzed the conflicting views of High Courts (e.g., Bombay, Delhi, Madras) on whether arbitral tribunals can implead non-signatories. It favored the broader view, aligning with Cox and Kings (I) and Adavya Projects, that tribunals have such powers under Section 16, rooted in the arbitration agreement and the kompetenz-kompetenz principle. [Para 15]
  • The Court emphasized that the Arbitration and Conciliation Act, 1996, and the proposed 2024 Bill lack express provisions on impleadment, causing procedural uncertainties, and urged legislative reform. [Para 170]
  • The cases collectively supported the Court’s conclusions that: (i) the tribunal could implead ABPL based on the Group of Companies Doctrine, (ii) non-service of a Section 21 notice was not fatal, and (iii) the tribunal’s jurisdiction was not limited by Section 11 proceedings or procedural formalities.

Multiple Choice Questions (MCQs)

  1. What is the primary source of an arbitral tribunal’s jurisdiction to implead non-signatories, as per the Supreme Court in this case?
    a) The referral court’s order under Section 11
    b) The arbitration agreement
    c) The notice under Section 21
    d) The Arbitration and Conciliation Act, 1996 Answer: b) The arbitration agreement
    Explanation: The Court held that the tribunal’s jurisdiction to implead non-signatories derives from the arbitration agreement, not the referral court’s order or procedural notices. [Para 139]
  2. Under which principle can an arbitral tribunal rule on its own jurisdiction, including the joinder of non-signatories?
    a) Res Judicata
    b) Kompetenz-Kompetenz
    c) Estoppel
    d) Group of Companies Doctrine Answer: b) Kompetenz-Kompetenz
    Explanation: Section 16 embodies the kompetenz-kompetenz principle, empowering the tribunal to rule on its jurisdiction, including whether non-signatories are bound by the arbitration agreement. [Para 134]
  3. What is the primary purpose of a notice under Section 21, as clarified in the case?
    a) To limit the scope of claims in arbitration
    b) To determine the commencement of arbitral proceedings for limitation purposes
    c) To confer jurisdiction on the arbitral tribunal
    d) To mandatorily include all parties to be impleaded Answer: b) To determine the commencement of arbitral proceedings for limitation purposes
    Explanation: Section 21 is procedural, fixing the start of arbitration for limitation under Section 43, and does not restrict claims or parties. [Para 152]
  4. Which doctrine was applied to justify impleading ABPL as a non-signatory in this case?
    a) Alter Ego Doctrine
    b) Group of Companies Doctrine
    c) Doctrine of Separate Legal Personality
    d) Doctrine of Privity of Contract Answer: b) Group of Companies Doctrine
    Explanation: The tribunal and Court applied the Group of Companies Doctrine, finding ABPL’s substantial involvement in the ASF Group’s operations and agreements. [Para 162]
  5. What did the Supreme Court recommend regarding the Arbitration and Conciliation Act, 1996?
    a) Repeal the Act entirely
    b) Include statutory recognition of the tribunal’s power to implead non-signatories
    c) Remove the Group of Companies Doctrine
    d) Make Section 21 notices mandatory for all claims Answer: b) Include statutory recognition of the tribunal’s power to implead non-signatories
    Explanation: The Court urged legislative reform to address the lack of express provisions on impleadment powers, noting deficiencies in the 2024 Bill. [Para 170]
  6. Which case was extensively relied upon to define the Group of Companies Doctrine in this judgment?
    a) State of Goa v. Praveen Enterprises
    b) Cox and Kings Ltd. v. SAP India Pvt. Ltd.
    c) Milkfood Ltd. v. GMC Ice Cream (P) Ltd.
    d) Govind Rubber Ltd. v. Louis Dreyfus Commodities Answer: b) Cox and Kings Ltd. v. SAP India Pvt. Ltd.
    Explanation: Cox and Kings (2023 SCC OnLine SC 1634) provided the framework for applying the Group of Companies Doctrine to implead non-signatories. [Para 166]
  7. What happens if a non-signatory is not served a notice under Section 21, as per the Court’s ruling?
    a) The tribunal loses jurisdiction over them
    b) The arbitration agreement becomes void
    c) The tribunal can still implead them if they are bound by the agreement
    d) The non-signatory must be referred to a court under Section 11 Answer: c) The tribunal can still implead them if they are bound by the agreement
    Explanation: Non-service of a Section 21 notice does not nullify the tribunal’s jurisdiction, as it is procedural and not jurisdictional. [Para 160]
  8. Which section of the Arbitration and Conciliation Act, 1996, allows the tribunal to entertain additional claims or counter-claims, including against non-signatories?
    a) Section 7
    b) Section 16
    c) Section 21
    d) Section 23 Answer: d) Section 23
    Explanation: Section 23 permits parties to raise claims and counter-claims within the arbitration agreement’s scope, including against non-signatories, without requiring a prior Section 21 notice. [Para 159]
  9. What evidence supported ABPL’s impleadment under the Group of Companies Doctrine?
    a) A separate arbitration agreement signed by ABPL
    b) Common directorship, shared resources, and a Comfort Letter
    c) ABPL’s independent corporate status
    d) A court order under Section 11 Answer: b) Common directorship, shared resources, and a Comfort Letter
    Explanation: The Court found ABPL’s involvement in the ASF Group, evidenced by shared management, correspondence, and a Comfort Letter, justified its impleadment. [Para 163]
  10. What was the outcome of ABPL’s appeal to the Supreme Court?
    a) The appeal was allowed, and ABPL was excluded from arbitration
    b) The appeal was dismissed, upholding the tribunal’s jurisdiction
    c) The case was remanded to the High Court
    d) The arbitration was terminated Answer: b) The appeal was dismissed, upholding the tribunal’s jurisdiction
    Explanation: The Supreme Court dismissed the appeal, affirming the tribunal’s and High Court’s decisions to implead ABPL. [Para 173]

Frequently Asked Questions (FAQs)

  1. What was the main issue in ASF Buildtech Pvt. Ltd. v. Shapoorji Pallonji & Co. Pvt. Ltd.?
    The main issue was whether an arbitral tribunal can implead non-signatories to an arbitration agreement, particularly under the Group of Companies Doctrine, and whether non-service of a Section 21 notice affects this power. The Court also examined the applicability of the doctrine to ABPL’s involvement in the ASF Group. [Paras 6-11]
  2. What is the Group of Companies Doctrine, and how was it applied in this case?
    The Group of Companies Doctrine allows non-signatories to be bound by an arbitration agreement if they are part of a group of companies with substantial involvement in the contract’s negotiation, performance, or termination, showing mutual intent. In this case, ABPL was impleaded due to its role in the ASF Group, evidenced by common directorship, shared resources, correspondence, and a Comfort Letter, as per Cox and Kings (2023 SCC OnLine SC 1634). [Paras 162-166]
  3. Does an arbitral tribunal have the power to implead non-signatories?
    Yes, the tribunal has the authority to implead non-signatories if they are found to be bound by the arbitration agreement under principles like the Group of Companies Doctrine. This power stems from the arbitration agreement and Section 16’s kompetenz-kompetenz principle, not from a referral court’s order under Section 11. [Paras 139-143]
  4. Is a notice under Section 21 mandatory for impleading a non-signatory?
    No, non-service of a Section 21 notice does not preclude the tribunal from impleading a non-signatory. Section 21 is procedural, aimed at fixing the commencement of arbitration for limitation purposes under Section 43, and does not limit the tribunal’s jurisdiction to claims or parties within the arbitration agreement’s scope. [Paras 144-160]
  5. What role does Section 16 play in this case?
    Section 16 embodies the kompetenz-kompetenz principle, empowering the tribunal to rule on its own jurisdiction, including whether a non-signatory like ABPL is bound by the arbitration agreement. The Court upheld the tribunal’s dismissal of ABPL’s Section 16 application, affirming its jurisdiction. [Paras 134-137]
  6. Why was ABPL considered a party to the arbitration despite being a non-signatory?
    ABPL was impleaded because it was part of the ASF Group, which operated as a single economic unit. Evidence of its involvement in the Works Contract and Settlement Agreement, including common management, shared branding, and a Comfort Letter, showed its intent to be bound, satisfying the Group of Companies Doctrine. [Paras 162-163]
  7. What did the Court say about the Arbitration and Conciliation Act, 1996, and its limitations?
    The Court noted that the 1996 Act lacks express provisions for the tribunal’s power to implead non-signatories, leading to procedural uncertainties. The proposed Arbitration and Conciliation Bill, 2024, also fails to address this issue. The Court urged the Ministry of Law and Justice to consider statutory recognition of this power. [Para 170]
  8. How does this case impact the understanding of Section 21’s role in arbitration?
    The case clarifies that Section 21’s notice is procedural, not jurisdictional. Its primary purpose is to mark the start of arbitration for limitation purposes, and additional claims or parties (including non-signatories) can be included under Section 23 without a prior Section 21 notice, provided they fall within the arbitration agreement’s scope. [Paras 152-160]
  9. What was the significance of the Comfort Letter in this case?
    The Comfort Letter issued by AISPL, part of the ASF Group, was key evidence of the group’s composite operations and ABPL’s involvement. It supported the tribunal’s finding that ABPL was inextricably linked to the agreements, justifying its impleadment under the Group of Companies Doctrine. [Para 163]
  10. What was the final outcome of the case?
    The Supreme Court dismissed ABPL’s appeal, upholding the Delhi High Court’s dismissal of the Section 37 appeal and the tribunal’s rejection of ABPL’s Section 16 application. The Court affirmed the tribunal’s jurisdiction to implead ABPL and left all other contentions open for arbitration. [Paras 173-174]
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  • Krishna Kumar Kedia v. Union of India
    Penal Code, 1860, Sections 407, 420, 465, 471 – Forgery and Misappropriation – Conviction Upheld – Sentence Reduced.
  • Shenbagavalli v. Inspector of Police, Kancheepuram District
    Abetment of Suicide – Section 306 IPC – Essential Ingredients – Absence of Proximity and Instigation – Quashing of Chargesheet.
  • Drugs and Cosmetics (Compounding of Offences) Rules, 2025
    These rules may be called the Drugs and Cosmetics (Compounding of Offences) Rules, 2025.
  • Kerala State Elderly Commission Act, 2025
    An Act to constitute an Elderly Commission for giving guidelines in matters related to the welfare and protection of the elderly and to enable their rehabilitation and to undertake and carry out schemes and activities necessary for making use of their skills and experience for utilizing it for the general public and to ensure the protection of rights and for matters connected therewith or incidental thereto.
  • Okhla Enclave Plot Holders Welfare Association v. Union of India
    Land Allotment Dispute – Haryana Development and Regulation of Urban Areas Act, 1975
  • Central Bureau of Investigation v. Surendra Patwa
    Administrative and criminal proceedings operate independently; procedural lapses in former do not nullify latter.
  • Principal Chief Conservator of Forest v. Suresh Mathew
    Judicial review in contractual matters limited to cases of mala fides, arbitrariness, or irrationality – Decision to re-tender due to Covid-19 restrictions affecting contractor participation held bona fide and in public interest – No fundamental right to renewal of contractor registration – Government’s discretion to protect financial interests by inviting fresh tenders upheld.