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2025 DIGILAW 1568 (TS)

NMDC Steel Limited v. Danieli and C-Officine Meccaniche SpA

2025-11-20

GADI PRAVEEN KUMAR, MOUSHUMI BHATTACHARYA

body2025
ORDER : 1. The instant Writ Petition has been filed for a Writ of Certiorari quashing the Procedural Order No.15 dated 15.09.2025 passed by the Arbitral Tribunal as being perverse and in contravention of the principles of natural justice and equal treatment of parties under the provisions of The Arbitration and Conciliation Act, 1996 (‘the 1996 Act’) and the ICC Rules. 2. By the said impugned Procedural Order, the venue of the Closing Hearing in the Arbitration was shifted from Delhi to London, UK. 3. The petitioner prays for restoration of the venue to a location in Hyderabad. The petitioner also prays for an interim order for stay of the Arbitration Proceedings pending before the Arbitral Tribunal in ICC. 4. The petitioner is a respondent in an International Arbitration between a foreign party and its Indian counterpart and another party based in Mumbai (3 claimants). Hyderabad, India, is designated as the venue of the Arbitral Proceedings. 5. The Arbitration Agreement is inserted in a Contract dated 24.08.2012 and envisages Arbitration with a foreign contractor of a contract value of more than Rs.20 crores governed by the Rules of Arbitration of International Chamber of Commerce (‘ICC Rules’), Paris. 6. The Court granted ex parte ad interim protection to the petitioner on 07.10.2025 directing the Arbitral Tribunal not to proceed in terms of an email dated 05.10.2025 whereby the petitioner was asked to confirm the bookings at IDRC, London by 6:00 PM on that date. The Court made it clear that the interim order would remain for a limited period of time until the respondents entered appearance and that the parties would be at liberty of exploring Hyderabad or New Delhi as alternative venues for the Closing Hearing. The Court further made it clear that it had not granted the prayer for stay of Arbitration. 7. The respondents entered appearance pursuant to notice and Senior Counsel was heard on several occasions thereafter. The respondents are the claimants in the Arbitration. 8. Learned Senior Counsel appearing for the respondents has urged that the Writ Petition is misconceived being in violation of the settled law with regard to the remedy provided to a party to an Arbitration to approach the Courts. The respondents are the claimants in the Arbitration. 8. Learned Senior Counsel appearing for the respondents has urged that the Writ Petition is misconceived being in violation of the settled law with regard to the remedy provided to a party to an Arbitration to approach the Courts. Senior Counsel submits that the impugned Procedural Order does not suffer from perversity and is in consonance with the terms of reference and the ICC Arbitration Rules which confers authority on the Arbitral Tribunal to decide on an appropriate location. It is further argued that the writ petitioner did not object to the International Disputes Resolution Centre (IDRC), London, in the meeting held on 15.09.2025 culminating in the impugned Procedural Order No.15. 9. Learned Senior Counsel appearing for the petitioner seeks to sustain the interim order on the ground that the Arbitral Tribunal did not have any reasonable justification to shift the venue from New Delhi to London and failed to consider Hyderabad as a viable option. Senior Counsel submits that the ICC Rules as well as the law relevant to the subject places primacy on the consent of the parties which is not reflected in the impugned Procedural Order. It is also submitted that the respondents are adamant in terms of holding the Closing Hearing only in London as opposed to any place in India. Senior Counsel places recent emails exchanged between the parties in this regard. 10. We have considered the submissions of both the parties with reference to the case law cited and intent to give a decision under distinct heads. Maintainability of the Writ Petition: 11. The Writ Petition has been filed under Article 226 of the Constitution of India on the ground that the impugned Procedural Order is arbitrary, was passed in bad faith and in contravention of the principles of natural justice. The petitioner has relied on recent decisions of the Supreme Court in furtherance of its contention. The law with regard to the interference in Arbitration Proceedings under Articles 226 and 227 of the Constitution of India is as follows. 12. Courts have declared that an intervention/interference in Arbitration through the route of Article 226 is only warranted where the writ petitioner is able to make out a case of gross perversity and lack of inherent jurisdiction. The law with regard to the interference in Arbitration Proceedings under Articles 226 and 227 of the Constitution of India is as follows. 12. Courts have declared that an intervention/interference in Arbitration through the route of Article 226 is only warranted where the writ petitioner is able to make out a case of gross perversity and lack of inherent jurisdiction. In essence, interference under Article 226/227 is permissible only if the order is perverse to the extent of “…must stare in the face…” Serosoft Solutions Pvt. Ltd. v. Dexter Capital Advisors Pvt. Ltd. , 2025 INSC 26 . In that decision, the Supreme Court underscored that the High Court’s should not interfere with orders passed by Arbitral Tribunals and should only exercise the power under Article 226/227 in exceptional cases including of bad faith. In Serosoft (supra), the Supreme Court found that the High Court had unnecessarily interfered with the directions passed by the Arbitral Tribunal. 13. The Supreme Court found that the respondent in Bhaven Construction v. Exe Engineer Sardar Sarovar Narmada Nigam Ltd. (2022) 1 SCC 75 had failed to show exceptional circumstances or bad faith on the part of the appellant for invoking the remedy under Article 227 of the Constitution despite the ambit of Article 227 being broad and pervasive. The Supreme Court accordingly found that the High Court erred in utilizing its discretionary power under Articles 226 and 227 of the Constitution to interdict the arbitration process. 14. Moreover, a foray to the writ Court can only be if the order is perverse to the extent of being in patent lack of inherent jurisdiction: Punjab State Power Corporation Ltd. v. Emta Coal Limited , (2020) 17 SCC 93 . In that decision, the Supreme Court relied on Deep Industries Ltd. v. ONGC , [ (2020) 15 SCC 706 ] to hold that the High Court should have dismissed the Article 227 petition as there was no perversity in the order of dismissal of the petitioner’s application under section 16 of the 1996 Act. The decisions of the Single Benches of the Delhi High Court in CS Construction Company Pvt. Ltd. v. Excelling Geo and Engineering Consultant and others , (2024) SCC OnLine Del 5161 and Lalit Mohan v. National Agricultural Co. Federation of India Ltd. (NAFED), W.P. (C) No. 13833/2024 and CM APPL. Nos. The decisions of the Single Benches of the Delhi High Court in CS Construction Company Pvt. Ltd. v. Excelling Geo and Engineering Consultant and others , (2024) SCC OnLine Del 5161 and Lalit Mohan v. National Agricultural Co. Federation of India Ltd. (NAFED), W.P. (C) No. 13833/2024 and CM APPL. Nos. 57948-57949/2024 in respect to the limited jurisdiction of the Writ Court in interfering with Procedural Orders passed by Arbitral Tribunals may also be referred to in this context. 15. The issue of maintainability of the Writ Petition must be weighed on the petitioner’s argument of perversity i.e., whether the impugned Procedural Order No.15 is perverse to the extent of amounting to an inherent lack of jurisdiction of the Arbitral Tribunal to pass the said order. Hence, the alleged perversity needs to be tested on the material placed before the Court. Does the impugned Procedural Order satisfy the Benchmark of an Exceptional and Rare Case? 16. The contours of challenge in the Writ Petition involve the alleged arbitrary shift of venue from New Delhi to London despite the same being contrary to the Agreement between the parties. The petitioner also says that the Arbitral Tribunal’s decision to change the venue violated the mandate of equal treatment of parties under section 18 of the 1996 Act. The documents placed before us reveal the following facts: (i) Clause X Article 41 of the Agreement designates Hyderabad, India, as the venue of Arbitration. (ii) Clause X Article 43 authorizes the Tribunal to conduct hearings and meetings “at any location it considers appropriate” after consultation with the Parties pursuant to Article 18(2) of the ICC Rules. Article 43 further provides that the Tribunal “may deliberate at any location it considers appropriate”. (iii) Article 18(2) of the ICC Rules reproduces the language of Clause X Article 43 in that the Arbitral Tribunal may, after consulting the parties, conduct hearings and meetings at any location it considers appropriate, unless otherwise agreed by the parties. Articles 18 (2) and 18 (3) provide that the Arbitral Tribunal may deliberate at any location it considers appropriate. (iv) Procedural Order No.14, dated 17.07.2025 records that the main evidentiary hearing was held on 3.7.2025-17.7.2025 at the IDRC, London. Procedural Order No.14 further records that the parties and the Tribunal held a Fourth Case Management Conference on 15.07.2025 to discuss matters including for the hearing for Oral Closing Submissions. (iv) Procedural Order No.14, dated 17.07.2025 records that the main evidentiary hearing was held on 3.7.2025-17.7.2025 at the IDRC, London. Procedural Order No.14 further records that the parties and the Tribunal held a Fourth Case Management Conference on 15.07.2025 to discuss matters including for the hearing for Oral Closing Submissions. The Procedural Order also records that the Closing Hearing shall be held in person and the venue will be New Delhi, India pursuant to the joint request of the parties. The dates for the Closing Hearing were fixed on 10-16.12.2025 with 17.12.2025 as a reserved date. (v) The Arbitral Tribunal passed the Impugned Procedural Order on 15.09.2025 changing the venue from New Delhi to IDRC, London in the presence of the parties/their Counsel and representatives. (vi) The Tribunal sent an email to the parties/their Counsel on 25.09.2025 referring to the impugned Procedural Order No.15 and requested the parties to confirm the booking of the venue at IDRC, London for the Closing Hearing fixed on 10-17.12.2025. (vii) The petitioner’s counsel sent an email to the Arbitral Tribunal on 26.9.2025 stating that counsel is awaiting further instructions from the petitioner since the petitioner, being a Public Sector Undertaking, is required to undertake certain administrative compliances in this regard. (viii) The Writ Petition was filed on 06.10.2025. The Court granted interim protection to the petitioner on 07.10.2025. 17. The above sequence of events is necessary in the context of the impugned Procedural Order and to Article 18(2) of the ICC Rules which empowers the Arbitral Tribunal to conduct hearings at any location it deems fit unless otherwise agreed by the parties (underlined for emphasis). 18. The petitioner’s claimed resistance to the change of venue is not reflected from any of the events stated above. The absence of objection to IDRC, London, would further be reinforced by the fact that the petitioner attended the evidentiary hearing from 03.07.2025 to 17.07.2025 at IDRC, London. The petitioner’s email of 26.9.2025, immediately after the impugned Procedural Order also does not record any objection to the change of venue. 19. It is also relevant to refer to an exchange of messages between the Arbitrators and the petitioner’s counsel on 14.12.2024, where the petitioner’s counsel agreed to Singapore as the preferred venue and made a specific reference to Hyderabad being unsuitable for that purpose. The petitioner’s counsel ends the conversation with the preferred option of Singapore and London. 19. It is also relevant to refer to an exchange of messages between the Arbitrators and the petitioner’s counsel on 14.12.2024, where the petitioner’s counsel agreed to Singapore as the preferred venue and made a specific reference to Hyderabad being unsuitable for that purpose. The petitioner’s counsel ends the conversation with the preferred option of Singapore and London. The exchange of messages forms part of the counter filed by the respondents. 20. Hence, there is nothing on record to show that the petitioner articulated its objection to IDRC London either before the impugned Procedural Order No.15 or even immediately after the said Order. The very fact that the petitioner expressed its inclination, through counsel, to Singapore or London as the venue in December 2024 and attended the evidentiary hearing in July, 2025 at IDRC, London, would considerably dilute the petitioner’s stand of IDRC, London being thrust upon the petitioner despite its reservation to the choice of venue. 21. The text of the impugned Procedural Order No.15 dated 15.09.2025 records the petitioner’s objection (respondent in the Arbitration) to Hyatt Regency, New Delhi and its response to the Imperial, New Delhi. The impugned Procedural Order does not record any objection by or on behalf of the petitioner specifically with regard to IDRC, London. In fact, paragraph 33 of the impugned Procedural Order records that “both parties agree(d)” that the price charged by the Taj Mansingh, New Delhi, for the Closing Hearing dates in December 2025 is cost-prohibitive. Therefore, the petitioner’s alleged objection to the shift of venue was only restricted to the three proposed hotels in New Delhi. Significantly, the petitioner also did not raise the option of Hyderabad as a viable alternative to New Delhi or even London in the Meeting held on 15.09.2025. 22. There is also no communication produced to show that the petitioner protested against the decision to hold the hearings in IDRC, London, after the impugned Procedural Order. In fact as stated above, the petitioner’s email of 26.9.2025 is to the contrary, that is, the petitioner awaiting completion of administrative formalities. 23. The above factors lead us to the considered view that the impugned Procedural Order No.15 does not amount to an exceptional or rare case warranting interference by the Writ Court in an ongoing arbitration. Is the Impugned Procedural Order No.15 dated 15.9.2025 Perverse? 24. 23. The above factors lead us to the considered view that the impugned Procedural Order No.15 does not amount to an exceptional or rare case warranting interference by the Writ Court in an ongoing arbitration. Is the Impugned Procedural Order No.15 dated 15.9.2025 Perverse? 24. It is evident from the recordings in the impugned Procedural Order that the only point of discussion was whether the three proposed hotels in New Delhi would fit the infrastructural requirements for the Closing Hearing. The Arbitral Tribunal discussed the suitability of each of these hotels in detail including the objections and response of the parties. Paragraph 31 gives a breakdown of costs for the venues, namely, Imperial Hotel, Hyatt Rejency, Taj Mansingh and concludes that the costs quoted for the three New Delhi venues are significantly higher than the price quoted by the IDRC, London. 25. Paragraph 32 further notes the additional costs required for the “Epiq” staff to travel to New Delhi. The Court is informed that Epiq is an agency providing evidence-assistance to the parties in the Arbitration. Paragraphs 33 and 34 reiterate that while Taj Mansingh is the only practicable solution/venue for the Closing Hearing, the asking-price of Taj Mansingh is 6 times that of IDRC, London. Paragraph 35 records the Tribunal is conscious of the travel costs of the representatives of the petitioner but that the closing submissions would essentially require the presence of Counsel in person and all the representatives of the clients may use the hybrid facility in London for following the proceedings. Paragraph 36 records the conclusion of the Tribunal to move the venue of the Closing Hearing to IDRC in London. 26. The impugned Procedural Order is not opaque with regard to the decision to shift the venue from New Delhi to IDRC, London. The Arbitral Tribunal gives sufficient reasons for the shift of venue, the primary reason being that of IDRC being cost-effective compared to Taj Mansingh in Delhi. Perversity, even on a broader understanding of the word, signifies a decision which is unhinged, in the sense of being removed from reasons and evidence. A perverse order is one where the decision-making authority comes to a conclusion without being tethered to the submissions made on behalf of the parties or material relied on their behalf. A perverse order must also be one which defies logic and contains reasons extraneous to the issue at hand. A perverse order is one where the decision-making authority comes to a conclusion without being tethered to the submissions made on behalf of the parties or material relied on their behalf. A perverse order must also be one which defies logic and contains reasons extraneous to the issue at hand. The impugned Procedural Order cannot be held to be perverse viewed within these parameters. 27. The petitioner’s contention of the impugned order violating the mandate of equal treatment of parties under section 18 of the 1996 Act would also be belied from the contents of the impugned Procedural Order. The said order does not reflect any objection taken by the petitioner to IDRC, London or any unfair or unequal treatment being meted out to the petitioner as compared to the respondents. As stated above, the petitioner’s participation in the evidentiary hearing in IDRC, London in July 2025 and the petitioner’s Counsel’s preference for London/Singapore in December 2024 as a venue of the Arbitration would emasculate the argument of unfair treatment. The petitioner cannot contend that London was thrust upon the petitioner or caught the petitioner unawares. 28. The facts and material placed before the Court lead us to the inevitable conclusion that the impugned Procedural Order No.15 does not breach the benchmark of reasons or reasonableness so as to amount to a perverse order. Consequentially, we also do not find any inherent lack of jurisdiction on the part of the Arbitral Tribunal to shift the venue from New Delhi to London. 29. Section 20 (3) of the 1996 Act authorizes the Arbitral Tribunal to meet at any place it considers appropriate unless otherwise agreed by the parties. Section 20 (3) of the Act was interpreted in Bharat Aluminium Company v. Kaiser Aluminium Technical Services Inc. , (2012) 9 SCC 552 as section 20(3) enables the Tribunal to meet at any place for conducting hearings at a place of convenience. Articles 18 (2) and 18 (3) of the ICC Arbitration Rules, 2021 offer the same legal position, that is, the Arbitral Tribunal is free to decide on a venue according to its convenience unless the parties disagree to such choice. The same intention is mirrored in Clause 10 of the terms of reference which have been referred to in the above paragraphs. 30. The same intention is mirrored in Clause 10 of the terms of reference which have been referred to in the above paragraphs. 30. Enercon (India) Limited v. Enercon GMBH , (2014) 5 SCC 1 carried the interpretation forward to hold that it is not mandatory for the Arbitral Tribunal to hold all its meetings at the place of the Arbitration; meetings/hearings can be held in a place other than the designated place of Arbitration either for the convenience of the Arbitral Tribunal or for the convenience of the parties. The view taken in Enercon (India) Limited (supra) was reiterated in BGS SGS Soma JV v. NHPC Limited , (2020) 4 SCC 234 . The primacy given to the agreement of the parties in the choice of venue would consequently require an unequivocal objection raised by the unwilling party to the choice of venue. The objection must be evident from the material placed before the Court. The impugned Procedural Order does not record any such objection taken by the petitioner to IDRC, London. On the other hand, the petitioner’s mail immediately after the Procedural Order appears to be a tacit consent thereto. 31. The law on the subject of whether the Arbitral Tribunal has the authority to decide on a venue independent of the Seat/Place of Arbitration, would further fortify the conclusion that the Arbitral Tribunal did not arrive at a perverse decision or act in excess of jurisdiction in choosing to shift the venue from New Delhi to London. 32. The inevitable conclusion from the undisputed facts and the law on the subject including the Terms of Reference and the ICC Arbitration Rules is that the impugned Procedural Order No.15 is not manifestly perverse so as to warrant interference under Article 226 of the Constitution. Does the Writ Petitioner have an Efficacious Alternative Remedy? 33. Section 16 of the 1996 Act deals with the competence of Arbitral Tribunal to rule on its jurisdiction. Sub-section (3) of section 16 provides a remedy to a party to take a plea that the Arbitral Tribunal is exceeding the scope of its authority. The objection shall be raised as soon as the alleged transgression occurs during the Arbitral Proceedings. 34. Sub-section (3) of section 16 provides a remedy to a party to take a plea that the Arbitral Tribunal is exceeding the scope of its authority. The objection shall be raised as soon as the alleged transgression occurs during the Arbitral Proceedings. 34. Section 16 (5) requires the Arbitral Tribunal to decide on the plea taken by the party under sub-section (3) but permits the arbitral proceedings to continue till making of the Arbitral Award if the Arbitral Tribunal rejects the plea taken by the party. Section 16 (6) provides a remedy to the aggrieved party to make an application for setting aside of the Arbitral Award in accordance with section 34 of the Act. 35. A reading of the aforesaid provisions would definitively indicate that a party to an arbitration has the statutory remedy to take an objection to the Arbitral Tribunal acting beyond its authority. The party has a further remedy of seeking recourse under section 34 of the Act for setting aside of the Award in the event the Arbitral Tribunal rejects the objection/plea taken by the party. Therefore, the writ petitioner who claims to be aggrieved by the impugned Procedural Order, could have availed of the remedy under section 16 (3) of the Act complaining of the alleged transgression of the bounds of the Arbitral Tribunal’s authority. The petitioner could also have waited for the making of the Arbitral Award in the event its plea/application was dismissed by the Arbitral Tribunal under section 16 (3). The petitioner however chose to invoke the extraordinary jurisdiction of this Court under Article 226 of the Constitution of India instead of availing of the statutory remedy. 36. We prefaced our decision by clarifying that the Writ Court has an extremely limited scope of interference in respect of arbitration matters and the interference is further restricted to rare and exceptional circumstances. The fact that the petitioner chose to give a go-by to an available efficacious statutory remedy for challenging a Procedural Order demolishes the argument of maintainability. 37. We accordingly reject the petitioner’s contention that the petitioner is without a remedy and the Writ Court was the only forum available to the petitioner. The fact that the petitioner chose to give a go-by to an available efficacious statutory remedy for challenging a Procedural Order demolishes the argument of maintainability. 37. We accordingly reject the petitioner’s contention that the petitioner is without a remedy and the Writ Court was the only forum available to the petitioner. The petitioner has also not shown any exceptions as to why the Writ Court should entertain the Writ Petition despite an alternative statutory remedy being available to the petitioner under the 1996 Act which is a complete Code in itself. The Interim order dated 07.10.2025. 38. The order was passed at the ad-interim stage and was premised on the material placed by the petitioner. The documents disclosed by the respondents in their counter considerably changes the picture. The new facts brought to the notice of the Court, including of the petitioner participating in the evidentiary hearing in IDRC, London in July 2025, substantially transforms the narrative which was presented to the Court on 07.10.2025. 39. It bears mention that the Court declined the petitioner’s prayer for stay of the arbitration proceeding and requested the parties to explore Hyderabad or New Delhi as an alternative venue for the Closing Hearing. The interim order records that the issue of maintainability shall be decided upon hearing of all the parties. Conclusion: 40. Thus, the Court does not find any rationale for the petitioner invoking the extraordinary jurisdiction under Article 226 of the Constitution by jettisoning the statutory remedy available to the petitioner. The Court accordingly finds the route taken by the petitioner to be without any basis and contrary to the 1996 Act as well as the law settled on the subject. This is certainly not a rare or exceptional case where the impugned Procedural Order No.15 dated 15.19.2025 is worthy of intervention. The Procedural Order also does not suffer from manifest perversity. 41. W.P.No.30363 of 2025 is accordingly dismissed on the ground of maintainability along with all connected applications. The interim order dated 07.10.2025 stands vacated. 42. The Court does not wish to enter into the other controversies raised by the parties, including whether the petitioner is attempting to derail the Arbitration since the order is restricted only to the aspect of maintainability.