Supreme Court: An Arbitration Award Can Be Enforced At The NCLT

A full bench of the Supreme Court of India in Cheran Properties Limited v. Kasturi and Sons Limited & Ors.^[1] has held that an award can be enforced even against a non-signatory to the arbitration proceedings. Further the Apex Court has ruled that such an award directing transfer of shares can be enforced through the NCLT.

Facts:

Sporting Pastime India Limited ('SPIL') a wholly owned subsidiary of Kasturi & Sons Limited ('KSL'), entered into an agreement with KC Palanisamy ('KCP'), KSL and another entity for transfer shares. The transaction was such that SPIL would transfer shares to KSL, 90% of which would then be sold to KCP and its nominees including, Cheran Properties Limited ('Cheran') which received 95% of KCP's 90% shares.