Supreme Court Ruling On The Unilateral Appointment Of Arbitrators By Public Sector Undertakings

The Supreme Court of India delivered the much-awaited judgment dealing with the arbitration clauses that deals with the unilateral appointment of the Arbitrators by Public Sector Undertakings (PSUs). On 8^th November 2024 the Constitution Bench compromising of Justice Shri Pankaj Mittal, Justice Shri Hrishikesh Roy, Justice Shri P S Narasimha, Justice Shri Manoj Mishra led by Chief Justice DY Chandrachud held that while PSUs may maintain a panel of potential arbitrators, they cannot compel a contesting party to appoint an arbitrator from the curated panel. This ruling underscores the principle of equality and fairness in arbitration proceedings, with significant implications for future arbitration clauses in public-private contract.