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ARTICLE · 19 JUNE 2025

Supreme Court Reiterates The Distinctive Features Of A Valid Arbitration Agreement

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The Supreme Court of India ("SC") in the case of South Delhi Municipal Corporation of Delhi v SMS Limited, 2025 SCC OnLine SC 1138 (decided on 15 May 2025) reiterated the mandatory features of a dispute resolution clause in order to constitute it a valid arbitration agreement.

IndiaLitigation, Mediation & Arbitration
Thriyambak Kannan
Thriyambak Kannan
Annapoorani Ganapathy
Annapoorani Ganapathy
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The Supreme Court of India ("SC") in the case of South Delhi Municipal Corporation of Delhi v SMS Limited, 2025 SCC OnLine SC 1138 (decided on 15 May 2025) reiterated the mandatory features of a dispute resolution clause in order to constitute it a valid arbitration agreement. The Court passed a common judgment in a batch of three appeals.

Facts:

  • The three appeals from the High Court of Delhi ("HC") involved a similar question regarding interpretation of a dispute resolution clause in Concession Agreements ("Agreements") between the Municipal Corporation of Delhi ("MCD") and three private contractors for the development of parking spaces and commercial complexes. While MCD contended that the dispute resolution mechanism under Article 20 of the Agreements provided for dispute resolution through mediation, the private contractors interpreted the clause to mandate arbitration between the parties.

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