Appellate Arbitration Not Contrary To Indian Law Says Supreme Court

In a recent case of M/s Centrotrade Minerals & Metal Inc. versus Hindustan Copper Ltd. arising out of Civil Appeal No. 2562 of 2006, a special bench of the Supreme Court (constituting of Hon'ble Justice Madan B. Lokur, Hon'ble Justice R. K. Agarwal and Hon'ble Justice D. Y. Chandrachud) has held that two tier arbitration will not be contrary to the Indian Laws even though such a process is not backed by any provision in the Arbitration and Conciliation Act, 1996 (hereinafter referred to as "the Act").

The following issues arose for the consideration of a three-judge bench of the apex court:

1. Whether a settlement of disputes or differences through a two-tier arbitration procedure as provided for in Clause 14 of the contract between the parties is permissible under the laws of India? And