SC: We see no bias in Foreign Arbitration in Reliance KG Basin Dispute, Centre's Plea dismissed,

The Supreme Court has dismissed petition filed by Ministry of Petroleum and Natural Gas against initiation of arbitration proceedings by Reliance industries, BP Exploration, and Niko Resources.

 

The Division Judge Bench of Justice Chief Justice DY Chandrachud and Justice PS Narasimha has given green singnal to Reliance to resolve its over a $400-million cost recovery dispute involving natural gas exploration via Arbitration with the Centre.

Previously, a petition has been filed in the Delhi High Court seeking halt of the Arbitration Proceedings allgeing bias by two Arbitrators of foreign origin, Michael D Kirby and Bernard Rix. The third Arbitrator in the matter is ex-CJI, VN Khare.

The Senior Counsel has contended that there is an evident bias and justifiable doubts regarding the independence and impartiality of the two foreign arbitrators, owing to which the Centre has "lost faith" in the proceedings.

He placed Procedural Orders passed by the Arbitrators and contended that it is not in law for Arbitrator to decide allegations against himself and it could only be done by the Court.

 

Contrarily, Senior Counsel for Reliance, Mr. Harish Salve argued that the allegation are nothing but 'delaying tactics' employed by the Government. The submitted that ground of bias doesn't arises until there is some 'motivated error'.

The Court thus ruled in favour of Reliance and dismissed the petition.

During the hearing, in an interesting instance, an incident of heated exchange happened between CJI Chandrachud and Senior Counsel for State, Senior Advocate Ganguli who had argued that "heavens won't fall" if the proceedings are delayed until the SLP is decided.

This didn't impress the CJI who was of the opinion that such eleventh minute delay dents the promotion of Alternate Dispute Resolution mechanism as means to resolve issues quicker. It also asked the Government if this way investment in India could be encouraged.

"Heavens will fall if this is the way the government scuttles international arbitration. We are crying hoarse that we should encourage arbitration as an alternative mechanism to speed up resolution of commercial disputes to encourage foreign investment in India. Is this the way to encourage foreign investors to come to India for business purposes?", he said.

 

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(With input from news agency language) 

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