Enforceability Of An Arbitration Clause In An Insufficiently Stamped Agreement

Co-author: Ayushi Tandon
[The co-author was an intern and not an advocate working with S&A]

In a recent judgement passed by the Hon'ble Supreme Court of India in the matter of Dharmaratnakara Rai Bahadur Arcot Narainswamy Mudaliar Chattram and Other Charities and Ors. vs. Bhaskar Raju and Brothers and Ors¹, the apex court discussed the issue whether an arbitration agreement contained in an insufficiently stamped instrument valid and enforceable under law. As per factual matrix of the case, the parties had executed a leased deed for a period of 38 years on 31.05.1996. Under the terms of the said lease, the Respondent No.1- Bhaskar Raju and Brothers had to construct a multipurpose auditorium which would be used for weddings. The Respondent No.1 was also required to obtain vacant possession of the said land, with the assistance of the lessor in ejecting the existing tenants. A subsequent lease deed was executed on 12.03.1997 with similar terms and conditions found in