M/S. SHREE VISHNU CONSTRUCTIONSversusTHE ENGINEER IN CHIEF MILITARY ENGINEERING SERVICE & ORS.

                         [2023] 5 S.C.R. 327                              327


            M/S. SHREE VISHNU CONSTRUCTIONS                               A
                                  v.
     THE ENGINEER IN CHIEF MILITARY ENGINEERING
                   SERVICE & ORS.
                   (Civil Appeal No. 3461 of 2023)                        B
                            MAY 09, 2023
          [M. R. SHAH AND C. T. RAVIKUMAR, JJ.]
       Arbitration and Conciliation (Amendment) Act, 2015 – s.26 –
Applicability of Amendment Act, 2015– Whether the provisions of
                                                                          C
the old Act (pre-Amendment Act, 2015) or the new Act (Amendment
Act, 2015) shall be applicable when the notice invoking arbitration
is issued prior to the Amendment Act, 2015 but application to appoint
arbitrator u/s.11(6), 1996 Act is filed post Amendment Act, 2015 –
Held: In a case where the notice invoking arbitration is issued prior
to the Amendment Act, 2015 and the application u/s.11(6)is filed          D
post Amendment Act, 2015, the Amended Act, 2015 shall not be
applicable and the parties shall be governed by the pre-amendment
Act, 2015– Arbitration and Conciliation Act, 1996 – ss.11(6), 21.
      Arbitration and Conciliation (Amendment) Act, 2015 –Whether
the decision in the cases of Union of India v. Parmar Constructions       E
Company reported as [2019] 5 SCR 1009 and Union of India v. Pradeep
Vinod Construction Company reported as [2012] 17 SCR 64 are per
incuriam as the decision in the case of Board of Control for Cricket in
India (BCCI) v. Kochi Cricket Private Limited and Ors. reported as
[2018] 2 SCR 829 was not considered in the said decisions – Held:
                                                                          F
No – Arbitration and Conciliation Act, 1996.
      Dismissing the appeal, the Court
      HELD: 1.1 Section 11(6A) has been inserted by Amendment
Act, 2015, by which the powers of the Court dealing with an
application under Section 11(6) of the Act are restricted and as          G
per section 11(6A), the powers of the Court while deciding
application under Section 11(6) of the Act are confined to the
examination of the existence of an arbitration agreement, which
powers were not restricted in the pre-amendment Act, 2015.
However, Section 26 of the Amendment Act, 2015 provides that
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328           SUPREME COURT REPORTS                      [2023] 5 S.C.R.


A     nothing contained in this Act shall apply to the arbitral
      proceedings commenced, in accordance with the provisions of
      Section 21 of the principal Act, before the commencement of this
      Act unless the parties otherwise agree. At this stage, it is
      required to be noted that as per Section 21 of the principal Act,
      unless otherwise agreed by the parties, the arbitral proceedings
B
      in respect of a particular dispute commence on the date on which
      a request for that dispute to be referred to the arbitration is
      received by the respondent. Therefore, as per section 21 of the
      principal Act, the arbitral proceedings can be said to have
      commenced on the date on which a request for the dispute to be
C     referred to the arbitration is received by the respondent.
      Therefore, as per section 21 of the principal Act the arbitral
      proceedings can be said to have commenced on the date on which
      a request for the dispute to be referred to the arbitration is
      received by the respondent. At this stage, it is required to be
      noted that by Amendment Act, 2015, Sections 34 and 36 of the
D
      Arbitration Act also came to be amended and the interference of
      the Court in challenge to the award has been restricted and/or
      narrowed down. [Para 6.1][343-A-E]
            1.2 This Court is required to consider whether the decision
      in the cases of Parmar Constructions Company and Pardeep Vinod
E     Construction Company can be said to be per incuriam as the
      decision of this Court in the case of BCCI has not been considered
      by this Court in the said decisions. However, on a fair reading of
      the decisions in the case of BCCI and the observations made in
      paragraphs 37 to 39 and on a fair reading of decisions in the cases
F     of Parmar Constructions Company and Pardeep Vinod Construction
      Company, this Court in the case of BCCI has held that the
      Arbitration Amendment Act, 2015 is prospective in nature insofar
      as the proceedings under sections 34 & 36 are concerned. It is
      required to be noted that in the case of BCCI, application under
      section 11(6) was not the subject matter and there was no issue
G     before the Court that even in a case where the notice invoking
      the arbitration is issued prior to the Amendment Act, 2015, but
      the application under section 11(6) is filed post Amendment Act,
      2015, what will be the position and whether the old Act will be
      applicable or the amended Act. On the other hand, the decisions
H
M/S. SHREE VISHNU CONSTRUCTIONS v. THE ENGINEER IN                       329
        CHIEF MILITARY ENGINEERING SERVICE

in the case of Parmar Constructions Company is directly on the           A
point, namely, the application under section 11(6) of the Act. In
the case of Parmar Constructions Company , it is specifically
observed and held that in a case where notice invoking arbitration
is issued prior to Amendment Act, 2015 and the application under
section 11(6) is filed post amendment, as per section 21 of the
                                                                         B
principal Act, the date of issuance of the notice invoking arbitration
shall be considered as commencement of the arbitration
proceedings and therefore as per section 26 of the Amendment
Act, 2015, the Amended Act, 2015 shall not be applicable and
the parties shall be governed by the pre-amendment Act,
2015.The submission on behalf of the appellant cannot be                 C
accepted for the simple reason that this Court in the case of BCCI
was considering the court proceedings under sections 34 and
36. To that, this Court interpreted section 26 in paragraphs 37 to
39, and held that the Amendment Act is prospective in nature,
and will apply to those arbitral proceedings that are commenced
                                                                         D
as understood by section 21 of the principal Act, on or after the
Amendment Act, 2015 and to court proceedings which have
commenced on or after the Amendment Act, 2015 came into force.
Therefore, any observations made by this Court in paragraphs
37 to 39 in the case of BCCI shall be understood and construed
with respect to court proceedings which have commenced on or             E
after the Amendment Act coming into force, namely, the
proceedings under sections 34 & 36. Therefore, the decisions of
this Court in the cases of Parmar Constructions Company and
Pardeep Vinod Construction Company cannot be said to be per
incuriam and/or in conflict with the decision of this Court in the
                                                                         F
case of BCCI. In the case of Parmar Constructions Company
which is directly on the point, it isspecifically observed and held
that the 2015 Amendment Act, which came into force w.e.f.
23.10.2015 shall not apply to the arbitral proceedings which are
commenced in accordance with the provisions of section 21 of
the principal Act, 1996 before the coming into force the 2015            G
Amendment Act, unless parties otherwise agree (para 27). Similar
view has been expressed in the case of S.P. Singla Constructions
Private Limited. [Paras 9, 9.1][351-E-H; 352-A-C, D-G]


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330            SUPREME COURT REPORTS                      [2023] 5 S.C.R.


A           Union of India Vs. Parmar Construction Company,
            (2019) 15 SCC 682 : [2019] 5 SCR 1009; Union of
            India Vs. Pradeep Vinod Construction Company, (2020)
            2 SCC 464 : [2012] 17 SCR 64; S.P. Singla
            Constructions Private Limited Vs. State of Himachal
            Pradesh and Anr. (2019) 2 SCC 488 : [2018 14 SCR
B
            1005 – relied on.
             1.3 In the present case the notice invoking arbitration clause
      was issued on 26.12.2013, i.e., much prior to the Amendment
      Act, 2015 and the application under Section 11(6) of the Act has
      been preferred/filed on 27.04.2016, i.e., much after the
C     amendment Act came into force, the law prevailing prior to the
      Amendment Act, 2015 shall be applicable and therefore the High
      Court has rightly entered into the question of accord and
      satisfaction and has rightly dismissed the application under section
      11(6) of the Act applying the principal Act, namely, the Arbitration
D     and Conciliation Act, 1996, prevailing prior to the Amendment
      Act, 2015. This Court is in complete agreement with the view
      taken by the High Court. In a case where the notice invoking
      arbitration is issued prior to the Amendment Act, 2015 and the
      application under Section 11 for appointment of an arbitrator is
      made post Amendment Act, 2015, the provisions of pre-
E     Amendment Act, 2015 shall be applicable and not the Amendment
      Act, 2015. [Para 10][353-A-D]
            Board of Control for Cricket in India (BCCI) Vs. Kochi
            Cricket Private Limited and Ors., (2018) 6 SCC 287 :
            [2018] 2 SCR 829; Aravali Power Company Private
F           Limited Vs. Era Infra Engineering Limited, (2017) 15
            SCC 32 : [2017] 11 SCR 497; Ssangyong Engineering
            and Construction Company Limited Vs. National
            Highways Authority of India (NHAI), (2019) 15 SCC
            131 : [2019] 7 SCR 522; Hindustan Construction
            Company Limited and Anr. Vs. Union of India and Ors.,
G           (2020) 17 SCC 324; Government of India Vs. Vedanta
            Limited, (2020) 10 SCC 1; Patel Engineering Limited
            Vs. North Eastern Electric Power Corporation Limited,
            (2020) 7 SCC 167 : [2020] 4 SCR 156; Mayawati
            Trading v. Pradyut Debbarman, (2019) 8 SCC 714 :
H           [2019] 12 SCR 123 – referred to.
M/S. SHREE VISHNU CONSTRUCTIONS v. THE ENGINEER IN                            331
        CHIEF MILITARY ENGINEERING SERVICE

                         Case Law Reference                                   A
[2018] 2 SCR 829                    referred to               Para 3.2
[2019] 5 SCR 1009                   relied on                 Para 3.6
[2012] 17 SCR 64                    relied on                 Para 3.6
[2017] 11 SCR 497                   referred to               Para 3.7        B
[2018 14 SCR 1005                   relied on                 Para 3.8
[2019] 7 SCR 522                    referred to               Para 3.9
[2020] 4 SCR 156                    referred to               Para 3.12
                                                                              C
[2019] 12 SCR 123                   referred to               Para 7(i)
      CIVIL APPELLATE JURISDICTION: Civil Appeal No. 3461
of 2023.
       From the Judgment and Order dated 30.06.2020 of the High Court
for the State of Telangana at Hyderabad in ARBA No. 151 of 2016.              D
      K. Parameshwar, Ms. Arti Gupta, Ms. Kanti, Advs. for the
Appellant.
     Padmesh Mishra, Anukalp Jain, Yuvraj Sharma, Akshay Nain,
Arvind Kumar Sharma, Ms. Megha Karnwal, Gopal Jha, Advs. for the
Respondents.                                                                  E
      The Judgment of the Court was delivered by
      M. R. SHAH, J.
       1. Feeling aggrieved and dissatisfied with the impugned judgment
and order passed by the High Court for the State of Telangana at              F
Hyderabad in ARBA No. 151 of 2016by which the High Court has
dismissed the said application filed under Section 11 of the Arbitration
Act, 1996 (hereinafter referred to as “Act, 1996”) and has refused to
appoint an arbitrator on the ground that earlier the appellant had accepted
the amount as per the final bill in full and final settlement and without
raising any dispute and also signed and issued “no further claim              G
certificate”, the original applicant has preferred the present appeal.
      2. The facts leading to the present appeal in nutshell are as under:-
      2.1 That the appellant herein and the respondents entered into an
agreement vide agreement dated 22.07.2010 for additions/alterations to        H
332             SUPREME COURT REPORTS                               [2023] 5 S.C.R.


A     Senior Non-Commissioned Officers mess and repairs/renewals to floors
      in tech area at Air Force Academy, Hyderabad. The appellant raised a
      revised final bill for the aforesaid work on 10.07.2012. The payment in
      respect of the final bill was made to the appellant on 29.04.2013. The
      appellant also issued “no further claim” certificate.
B            2.2 The appellant sent a notice dated 20.12.2013 invoking the
      arbitration clause. The appellant preferred an application under Section
      11(6) of the Act, 1996 before the High Court on 27.04.2016 and prayed
      to appoint an arbitrator. The application was opposed by the respondents
      inter alia on the ground that the entire amount due and payable under
      the final bill was paid as far as back on 29.04.2013 and that even the
C     appellant issued the “no further claim” certificate and therefore, on the
      ground of “accord and satisfaction”, the dispute is not required to be
      sent for arbitration. However, it was the case on behalf of the appellant
      that in view of the Arbitration and Conciliation (Amendment) Act, 2015
      (hereinafter referred to as “Amendment Act, 2015”) by which Section
D     11(6A) came to be inserted, while deciding the application under Section
      11(6), the Court would have a very limited jurisdiction and to consider
      only whether there is an existence of the arbitration agreement or not
      and no further inquiry is permissible at the stage of deciding the application
      under Section 11(6) and the issue with respect to the “accord and
      satisfaction” has to be left to be decided by the arbitrator / arbitral tribunal.
E     Therefore, it was the case on behalf of the appellant that the provisions
      of the Amendment Act, 2015 shall be applicable.
            2.3 It was the case on behalf of the respondents that as per Section
      26 read with Section 21 of the Amendment Act, 2015, Amendment Act,
      2015 shall not be applicable in a case where arbitration proceedings as
F     per Section 21 of the Arbitration Act, has been commenced prior to the
      Amendment Act, 2015.
              2.4 By the impugned judgment and order, the High Court has
      dismissed the arbitration petition and has refused to appoint the arbitrator
      / arbitral tribunal on the ground that the Amendment Act, 2015 shall not
G     be applicable and the Act, pre-amendment, 2015, shall be applicable.
      That thereafter, after holding that there was a full and final settlement of
      the payment as per the final bill as far as back on 29.04.2013 and even
      the appellant issued the “no further claim” certificate and even the
      application under Section 11(6) of the Act, 1996 was filed after a period
H     of approximately three years, the High Court has dismissed the said
M/S. SHREE VISHNU CONSTRUCTIONS v. THE ENGINEER IN                            333
 CHIEF MILITARY ENGINEERING SERVICE [M. R. SHAH, J.]

arbitration application. The impugned judgment and order passed by the        A
High Court is the subject matter of present appeal.
       3. Shri K. Parameshwar, learned counsel has appeared on behalf
of the appellant.
       3.1 it is submitted by Shri Parameshwar, learned counsel appearing
on behalf of the appellant that the issue that arises for consideration in    B
the present appeal is the interpretation of Section 26 of the Amendment
Act, 2015 insofar as the applicability of the amended provisions, more
specifically, insertion of Section 11(6A) and its applicability to judicial
proceedings initiated after the Amendment Act, 2015 came into force
w.e.f. 23.10.2015.                                                            C
       3.2 Shri Parameshwar, learned counsel appearing on behalf of
the appellant has vehemently submitted that as such the aforesaid issue
is squarely covered by the decision of this Court in the case of Board of
Control for Cricket in India (BCCI) Vs. Kochi Cricket Private
Limited and Ors., (2018) 6 SCC 287(paras 37 and 39).                          D
       3.3 Relying upon the aforesaid decision, it is submitted that in the
said decision it is specifically observed and held by this Court that the
Amendment Act, 2015 shall be applicable prospectively and that even in
a case where the arbitration proceedings were initiated as per Section
21 of the Act, prior to the Amendment Act, 2015, the Amendment Act,           E
2015 shall be applicable.
       3.4 It is further submitted that this Court in BCCI (supra) had
the occasion to analyse and interpret Section 26 of the Amendment Act,
2015. The Court specifically traced the legislative history and thereafter
came to the conclusion that Section 26 is divided into two parts. The first   F
part applies to arbitral proceedings before the arbitrator and the second
part applies to the proceedings in relation to arbitral proceedings, which
means judicial proceedings. The Court held as follows:
         “38. That the expression “the arbitral proceedings” refers to
      proceedings before an Arbitral Tribunal is clear from the heading
                                                                              G
      of Chapter V of the 1996 Act, which reads as follows:
                       “Conduct of arbitral proceedings”
         The entire chapter consists of Sections 18 to 27 dealing with
      the conduct of arbitral proceedings before an Arbitral Tribunal.
      What is also important to notice is that these proceedings alone        H
334      SUPREME COURT REPORTS                           [2023] 5 S.C.R.


A     are referred to, the expression “to” as contrasted with the
      expression “in relation to” making this clear. Also, the reference
      to Section 21 of the 1996 Act, which appears in Chapter V, and
      which speaks of the arbitral proceedings commencing on the date
      on which a request for a dispute to be referred to arbitration is
      received by the respondent, would also make it clear that it is
B
      these proceedings, and no others, that form the subject-matter of
      the first part of Section 26. Also, since the conduct of arbitral
      proceedings is largely procedural in nature, parties may “otherwise
      agree” and apply the Amendment Act to arbitral proceedings that
      have commenced before the Amendment Act came into force. [
C     Section 29-A of the Amend (sic Amended) Act provides for time-
      limits within which an arbitral award is to be made. In Hitendra
      Vishnu Thakur v. State of Maharashtra, (1994) 4 SCC 602 at
      p. 633 : 1994 SCC (Cri) 1087, this Court stated: (SCC p. 633, para
      26)”26. … (iii) Every litigant has a vested right in substantive
      law but no such right exists in procedural law.(iv) A procedural
D
      statute should not generally speaking be applied retrospectively
      where the result would be to create new disabilities or obligations
      or to impose new duties in respect of transactions already
      accomplished.(v) A statute which not only changes the procedure
      but also creates new rights and liabilities shall be construed to be
E     prospective in operation, unless otherwise provided, either
      expressly or by necessary implication.” It is, inter alia, because
      timelines for the making of an arbitral award have been laid down
      for the first time in Section 29-A of the Amendment (sic Amended)
      Act that parties were given the option to adopt such timelines
      which, though procedural in nature, create new obligations in
F
      respect of a proceeding already begun under the unamended Act.
      This is, of course, only one example of why parties may otherwise
      agree and apply the new procedure laid down by the Amendment
      Act to arbitral proceedings that have commenced before it came
      into force.] In stark contrast to the first part of Section 26 is the
G     second part, where the Amendment Act is made applicable “in
      relation to” arbitral proceedings which commenced on or after
      the date of commencement of the Amendment Act. What is
      conspicuous by its absence in the second part is any reference to
      Section 21 of the 1996 Act. Whereas the first part refers only to
      arbitral proceedings before an Arbitral Tribunal, the second part
H
M/S. SHREE VISHNU CONSTRUCTIONS v. THE ENGINEER IN                                 335
 CHIEF MILITARY ENGINEERING SERVICE [M. R. SHAH, J.]

       refers to court proceedings “in relation to” arbitral proceedings,          A
       and it is the commencement of these court proceedings that is
       referred to in the second part of Section 26, as the words “in
       relation to the arbitral proceedings” in the second part are not
       controlled by the application of Section 21 of the 1996 Act.
          39. Section 26, therefore, bifurcates proceedings, as has been           B
       stated above, with a great degree of clarity, into two sets of
       proceedings — arbitral proceedings themselves, and court
       proceedings in relation thereto. The reason why the first part of
       Section 26 is couched in negative form is only to state that the
       Amendment Act will apply even to arbitral proceedings commenced
       before the amendment if parties otherwise agree. If the first part          C
       of Section 26 were couched in positive language (like the second
       part), it would have been necessary to add a proviso stating that
       the Amendment Act would apply even to arbitral proceedings
       commenced before the amendment if the parties agree. In either
       case, the intention of the legislature remains the same, the negative       D
       form conveying exactly what could have been stated positively,
       with the necessary proviso. Obviously, “arbitral proceedings” having
       been subsumed in the first part cannot re-appear in the second
       part, and the expression “in relation to arbitral proceedings” would,
       therefore, apply only to court proceedings which relate to the
       arbitral proceedings. The scheme of Section 26 is thus clear : that         E
       the Amendment Act is prospective in nature, and will apply to
       those arbitral proceedings that are commenced, as understood by
       Section 21 of the principal Act, on or after the Amendment Act,
       and to court proceedings which have commenced on or after the
       Amendment Act came into force.”                                             F
        3.5 It is further submitted that it is specifically held that the phrase
‘in relation to arbitral proceedings’ appearing in the second part of Section
26 refers to commencement of court proceedings and are not controlled
by Section 21 of the principal Act. It is submitted that in such
circumstances, the relevant date so far as the applicability of Section            G
11(6A) is concerned, is not the date of invocation of arbitration but the
date of commencement of judicial proceedings before a court under
Section 11. It is submitted that therefore viewed in this light, the finding
of the High Court that Section 11(6A) shall not be applicable in the
present case is clearly erroneous.
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336             SUPREME COURT REPORTS                            [2023] 5 S.C.R.


A           3.6 It is submitted that in the case of Union of India Vs. Parmar
      Construction Company, (2019) 15 SCC 682 (Two Judge Bench)
      (paras 25-27), without noticing the judgment in BCCI (supra), a
      coordinate Bench has held, relying on Section 21, that, the relevant date
      for applicability of Section 26 of the Amendment Act, 2015 is the date
      when request for appointment of arbitrator was made. It is further
B
      submitted that this has been followed in the judgment in the case of
      Union of India Vs. Pradeep Vinod Construction Company, (2020)
      2 SCC 464 (Three Judge Bench), which also did not refer to the case
      of BCCI (supra) but has only followed the judgment in Parmar
      Construction Company (supra).
C            3.7 It is submitted that the judgment in BCCI (supra) was
      rendered in the context of Section 36 of the Act and not in the context of
      Section 11. Both Pradeep Vinod Construction Company (supra)
      and Parmar Construction Company (supra) were cases relating to
      Section 11. However, neither of the case distinguished the second part
D     of Section 26 of the Amendment Act, 2015 as relating to judicial
      proceedings. It is further submitted that, in Parmar Construction
      Company (supra), reliance was placed on Aravali Power Company
      Private Limited Vs. Era Infra Engineering Limited, (2017) 15
      SCC 32 (Para 22), to examine the effect of Section 21 of the principal
      Act read with Section 26 of the Amendment Act, 2015. It is submitted
E     that the reliance placed on Aravali Power Company Private Limited
      (supra) in the case of Parmar Construction Company (supra) is
      completely misplaced. Firstly, neither Section 21 of the principal Act nor
      Section 26 of the Amendment Act, 2015 were discussed in Aravali
      Power Company Private Limited (supra). Secondly, the decision in
F     Aravali Power Company Private Limited (supra) did not concern
      judicial proceedings but applications filed before the arbitrator challenging
      his qualification under Sections 12 and 13. It is submitted that therefore,
      the second part of Section 26 did not come for consideration at all.
            3.8 It is submitted that similarly, the reliance placed in Parmar
G     Construction Company (supra) on S.P. Singla Constructions
      Private Limited Vs. State of Himachal Pradesh and Anr., (2019) 2
      SCC 488 (Para 16) is again misplaced because in S.P. Singla
      Constructions Private Limited (supra) issue also involved was
      disqualifications of an arbitrator under Section 12 and consequent filing
      of Section 11 petitions prior to coming into force of the Amendment Act,
H     2015.
M/S. SHREE VISHNU CONSTRUCTIONS v. THE ENGINEER IN                            337
 CHIEF MILITARY ENGINEERING SERVICE [M. R. SHAH, J.]

       3.9 It is submitted that on the other hand, this Court in Ssangyong    A
Engineering and Construction Company Limited Vs. National
Highways Authority of India (NHAI), (2019) 15 SCC 131 (Para
19), has held that, Section 34 as amended in 2015, will apply only to
Section 34 applications that have been made to the Court on or after
23.10.2015, irrespective of the fact that the arbitration proceedings may
                                                                              B
have commenced prior to that date and while doing so, this Court followed
the judgment in BCCI (supra).
        3.10 It is submitted that in order to get over the judgment in BCCI
(supra), the Parliament omitted Section 26 of the Amendment Act, 2015
w.e.f. 23.10.2015 by way of Section 15 of the Arbitration and Conciliation
(Amendment) Act, 2019, which was notified on 30.08.2019. It is further        C
submitted that the validity of Section 15 was inter alia challenged in
Hindustan Construction Company Limited and Anr. Vs. Union of
India and Ors., (2020) 17 SCC 324 (Three Judge Bench). It is
submitted that this Court held that, though the basis for the judgment in
BCCI (supra) was removed, but still found that Section 15 of the              D
Amendment Act, 2019 was unconstitutional as being manifestly arbitrary.
What is noteworthy is that despite having noticed that the Justice
Srikrishna committee report held that the Amendment Act, 2015 must
apply to arbitrations, which commenced on or after 23.10.2015 and related
court proceedings, the Court struck down the amendment and resurrected
the law as stated in BCCI (supra). The Court emphatically held that,          E

      “66. The result is that Kochi Cricket [BCCI v. Kochi Cricket (P)
      Ltd., (2018) 6 SCC] judgment will therefore continue to apply so
      as to make applicable the salutary amendments made by the 2015
      Amendment Act to all court proceedings initiated after 23-10-
      2015.”                                                                  F

      3.11 It is further submitted that the judgment in BCCI (supra),
so far as it differentiated between arbitral proceedings and court
proceedings, was followed in Government of India Vs. Vedanta
Limited, (2020) 10 SCC 1 (Three Judge Bench), and the Court
emphasized that the Amendment Act, 2015 would be applicable to court          G
proceedings arising out of arbitration proceedings, irrespective of whether
such arbitration proceedings commenced prior to or after the Amendment
Act, 2015.
      3.12 It is further submitted that the judgment in BCCI (supra)
has also been followed in Patel Engineering Limited Vs. North                 H
338             SUPREME COURT REPORTS                              [2023] 5 S.C.R.


A     Eastern Electric Power Corporation Limited, (2020) 7 SCC 167
      (Para 15) (Three Judge Bench).
             3.13 In light of this brief conspectus of the aforesaid decisions, it
      is submitted that, the decision in BCCI (supra), regarding judicial
      proceedings referred to in Section 26 not being controlled by Section 21
B     of the principal Act, has been followed by a coordinate bench of this
      Hon’ble Court in Ssangyong Engineering and Construction
      Company Limited (supra) and the three-judge benches in Hindustan
      Construction Company Limited and Anr.(supra), Vedanta Limited
      (supra) and Patel Engineering Limited(supra). It is further submitted
      that on the other hand, the decision by the coordinate bench in Parmar
C
      Construction Company (supra) was rendered in ignorance of the
      decision in BCCI (supra). Further, the coordinate bench in Parmar
      Construction Company (supra) placed reliance on the decisions in
      Aravali Power Company Private Limited(supra) and S.P. Singla
      Constructions Private Limited (supra), neither of which concerned
D     judicial proceedings as they were rendered on the issue of qualification
      or disqualification of the arbitrator. It is further submitted that the decision
      in the case of Parmar Construction Company (supra) was followed
      by the three-judge bench in Pradeep Vinod Construction Company
      (supra) without any reference to BCCI (supra).
E            3.14 It is therefore, the submission on behalf of the appellant that
      the decision of this Court in the case of BCCI (supra) was binding on
      the coordinate bench which rendered the decision in the case of Parmar
      Construction Company (supra), this Court has not noticed the said
      decision and therefore, the decision in the case of Parmar Construction
F     Company (supra) can be said to be per incuriam and/or sub silentio.
      It is submitted that therefore, the decision in the case of Parmar
      Construction Company (supra) being per incuriam, the larger Bench,
      which rendered the decision in the case of Pradeep Vinod Construction
      Company (supra) ought not to have placed reliance on Parmar
      Construction Company (supra) . Therefore, relying upon the decision
G     of this Court in the case of BCCI (supra), which has been subsequently
      followed in other decisions referred to hereinabove, it is prayed to allow
      the present appeal.
            4. Present appeal is vehemently opposed by Shri Padmesh Mishra,
      learned counsel appearing on behalf of the respondents.
H
M/S. SHREE VISHNU CONSTRUCTIONS v. THE ENGINEER IN                             339
 CHIEF MILITARY ENGINEERING SERVICE [M. R. SHAH, J.]

       4.1 It is vehemently submitted by the learned counsel appearing         A
on behalf of the respondents that as such the Hon’ble High Court has
rightly dismissed the Section 11(6) application by observing and holding
that the pre-amendment Arbitration Act, 2015 shall be applicable.
       4.2 It is submitted that in the present case, admittedly the notice
invoking the arbitration was issued on 20.12.2013, i.e., much prior to the     B
Amendment Act, 2015. It is further submitted that admittedly the
application under Section 11(6) of the Act, 1996 was preferred and filed
on 27.04.2016, i.e., much after the Amendment Act, 2015 came into
force. It is submitted that therefore, taking into consideration section 26
of the Amendment Act, 2015 and when the notice invoking the arbitration
was issued much prior to the Amendment Act, 2015, therefore, the               C
arbitration proceedings can be said to have commenced on 20.12.2013
and therefore, pre-Amendment Act, 2015 shall be applicable and not the
Amendment Act, 2015.
       4.3 Now, insofar as the reliance placed upon the decision of this
Court in the case of BCCI (supra) relied upon on behalf of the appellant       D
is concerned, it is submitted that the decision in the case of BCCI (supra)
and the subsequent decisions following the BCCI (supra) are all with
respect to the proceedings under Sections 34 and 36 of the Act, 1996. It
is submitted that therefore, considering Sections 34 and 36 proceedings
as judicial/court proceedings, this Hon’ble Court has interpreted Section      E
26, bifurcating Section 26 into two parts and to that it is observed and
held that with respect to judicial proceedings under Sections 34 and 36,
the Amendment Act, 2015 shall be applicable. It is submitted that, however,
on the other hand, there is a direct decision of this Hon’ble Court in the
case of Parmar Construction Company (supra) dealing with the very
issue of application under Section 11(6) of the Act, 1996 and in the said      F
decision it is specifically observed and held that so far as the application
under Section 11(6)of the Act, 1996 is concerned, in case the notice
invoking the arbitration is invoked prior to the Amendment Act, 2015,
pre Amendment Act, 2015 shall be applicable. It is submitted that as
such the decision of this Court in the case of Parmar Construction             G
Company (supra), which is a Two Judge Bench decision has been
subsequently considered and followed by a Three Judge Bench in the
case of Pradeep Vinod Construction Company (supra).
      4.4 It is further submitted that in the case of BCCI (supra), this
Court has unequivocally held that from the scheme contained in Section         H
340             SUPREME COURT REPORTS                            [2023] 5 S.C.R.


A     26 of the Amendment Act, it is clear that the Amendment Act is
      prospective in nature and will only apply to those arbitral proceedings
      that commence in terms of Section 21 of the Act, on or after the
      Amendment Act, and to Court proceedings, which have commenced on
      or after the Amendment Act came into force. It is submitted that it
      necessarily follows that in such cases, where the arbitration proceedings
B
      have been initiated prior to 23.10.2015, it will continue to be governed by
      the legal position as it existed prior to the coming into force of the
      Amendment Act, 2015.
             4.5 It is submitted that as submitted hereinabove, the judgments in
      Parmar Construction Company (supra) and Pradeep Vinod
C     Construction Company (supra) are with respect to the applications
      under Section 11(6) and the decision of this Court in the case of BCCI
      (supra) is with respect to the proceedings under Sections 34 and 36 and
      even the observations made in paragraphs 37 to 39 are with respect to
      the “court proceedings” and therefore, the aforesaid two decisions cannot
D     be said to be in conflict with the judgment in the case of BCCI (supra).
              4.6 It is submitted that the reliance by the appellant on the
      expression “court proceedings in relation thereto” as it occurs in Section
      26 of the Amendment Act, 2015 to contend that applications under Section
      11 of the Act, 1996 would fall in such category is misplaced. It is submitted
E     that it must be borne in mind that this Hon’ble Court was called upon to
      interpret Section 26 of the Amendment Act, 2015, to answer as to whether
      applications under Section 36, which was amended by the Amendment
      Act, 2015 would apply in its amended form in respect of Section 34/36
      proceedings initiated before the commencement of the Amendment Act,
      2015. It is submitted that, thus, any observation in BCCI (supra) ought
F     to be understood in the context in which the issue arose therein and the
      same cannot be said to have laid down the law as regards applicability
      of the Amendment Act, 2015 to Section 11 applications.
             4.7 It is submitted that the judgment in Parmar Construction
      Company (supra) follows the judgment of this Hon’ble Court in S.P.
G     Singla Constructions Private Limited (supra) in order to conclude
      that Section 11 petitions in respect of proceedings initiated prior to the
      commencement of the Amendment Act, 2015, would be governed by
      the pre-amended legal position. It is submitted that the said judgment in
      S.P. Singla Constructions Private Limited (supra) in turn follows
H     the observations of this Hon’ble Court in BCCI (supra).
M/S. SHREE VISHNU CONSTRUCTIONS v. THE ENGINEER IN                              341
 CHIEF MILITARY ENGINEERING SERVICE [M. R. SHAH, J.]

       4.8 It is further submitted that the issue as to whether the             A
Amendment Act, 2015 would apply to proceedings under Section 11,
with respect to arbitration commenced prior to 23.10.2015 (the date on
which the Amendment Act, 2015 came into force) has been elaborately
dealt with by a Three Judge Bench in the case of S.P. Singla
Constructions Private Limited (supra),after analysing threadbare
                                                                                B
the judgment in BCCI (supra) to conclude as under:-
      “16. Considering the facts and circumstances of the present case,
      we are not inclined to go into the merits of this contention of the
      appellant nor examine the correctness or otherwise of the above
      view taken by the Delhi High Court in Ratna Infrastructure Projects
                                                                                C
      case [Ratna Infrastructure Projects (P) Ltd. v. Meja Urja Nigam
      (P) Ltd., 2017 SCC OnLine Del 7808]; suffice it to note that as
      per Section 26 of the Arbitration and Conciliation (Amendment)
      Act, 2015, the provisions of the amended 2015 Act shall not apply
      to the arbitral proceedings commenced in accordance with the
      provisions of Section 21 of the principal Act before the                  D
      commencement of the Amendment Act unless the parties
      otherwise agree. In the facts and circumstances of the present
      case, the proviso in Clause (65) of the general conditions of the
      contract cannot be taken to be the agreement between the parties
      so as to apply the provisions of the amended Act. As per Section
                                                                                E
      26 of the Act, the provisions of the Amendment Act, 2015 shall
      apply in relation to arbitral proceedings commenced on or after
      the date of commencement of the Amendment Act, 2015 (w.e.f.
      23-10-2015). In the present case, arbitration proceedings
      commenced way back in 2013, much prior to coming into force of
      the amended Act and therefore, provisions of the amended Act              F
      cannot be invoked.
       17. In BCCI v. Kochi Cricket (P) Ltd. [(2018) 6 SCC 287], this
       Court has held that the provisions of the Amendment Act, 2015
       (with effect from 23-10-2015) cannot have retrospective operation
       in the arbitral proceedings already commenced unless the parties         G
       otherwise agree and held as under :
       …………………………..”
      4.9 It is submitted that it is a settled law that arbitration commences
upon invocation of the notice as per Section 21 of the Act, 1996. It is
                                                                                H
342             SUPREME COURT REPORTS                            [2023] 5 S.C.R.


A     submitted that therefore, in a case where the notice invoking the arbitration
      has been issued prior to the Amendment Act, 2015, on true interpretation
      of Section 26 read with Section 21 of the Amendment Act, 2015, the
      Amendment Act, 2015 shall not be applicable and the arbitration would
      be governed by the unamended provision.
B           4.10 Making above submissions and relying upon the decisions of
      this Court in the case of Parmar Construction Company (supra);
      Pradeep Vinod Construction Company (supra) and S.P. Singla
      Constructions Private Limited (supra), it is prayed to dismiss the
      present appeal.
C            5. We have heard learned counsel for the respective parties at
      length.
             The short question which is posed for the consideration of this
      Court is, in relation to the arbitration proceedings, in a case where the
      notice invoking arbitration is issued prior to the Amendment Act, 2015,
D     the old Act shall be applicable (pre-amendment 2015) or the new Act?
            6. While considering the aforesaid issue the relevant provisions of
      the Amendment Act, 2015 are required to be referred to, namely, Sections
      11(6A), 21 and 26, which are as under:
            “(6A) The Supreme Court or, as the case may be, the High Court,
E           while considering any application under sub-section (4) or sub-
            section (5) or sub-section (6), shall, notwithstanding any judgment,
            decree or order of any Court, confine to the examination of the
            existence of an arbitration agreement.
            21. Commencement of arbitral proceedings – Unless otherwise
F           agreed by the parties, the arbitral proceedings in respect of a
            particular dispute commence on the date on which a request for
            that dispute to be referred to arbitration is received by the
            respondent.
            26. Act not to apply to pending arbitral proceedings – Nothing
G           contained in this Act shall apply to the arbitral proceedings
            commenced, in accordance with the provisions of Section 21 of
            the principal Act, before the commencement of this Act unless
            the parties otherwise agree but this Act shall apply in relation to
            arbitral proceedings commenced on or after the date of
            commencement of this Act.”
H
M/S. SHREE VISHNU CONSTRUCTIONS v. THE ENGINEER IN                               343
 CHIEF MILITARY ENGINEERING SERVICE [M. R. SHAH, J.]

       6.1 Section 11(6A) has been inserted by Amendment Act, 2015,              A
by which the powers of the Court dealing with an application under
Section 11(6) of the Act are restricted and as per section 11(6A), the
powers of the Court while deciding application under Section 11(6) of
the Act are confined to the examination of the existence of an arbitration
agreement, which powers were not restricted in the pre-amendment
                                                                                 B
Act, 2015. However, Section 26 of the Amendment Act, 2015 provides
that nothing contained in this Act shall apply to the arbitral proceedings
commenced, in accordance with the provisions of Section 21 of the
principal Act, before the commencement of this Act unless the parties
otherwise agree. At this stage, it is required to be noted that as per
Section 21 of the principal Act, unless otherwise agreed by the parties,         C
the arbitral proceedings in respect of a particular dispute commence on
the date on which a request for that dispute to be referred to the arbitration
is received by the respondent. Therefore, as per section 21 of the principal
Act, the arbitral proceedings can be said to have commenced on the
date on which a request for the dispute to be referred to the arbitration
                                                                                 D
is received by the respondent. Therefore, as per section 21 of the principal
Act the arbitral proceedings can be said to have commenced on the date
on which a request for the dispute to be referred to the arbitration is
received by the respondent. At this stage, it is required to be noted that
by Amendment Act, 2015, Sections 34 and 36 of the Arbitration Act also
came to be amended and the interference of the Court in challenge to             E
the award has been restricted and/or narrowed down.
      7. The question of applicability of the Arbitration Amendment Act,
2015 fell for consideration before this Court in catena of decisions, few
of them are as under:
       i) In the case of Mayawati Trading v. Pradyut Debbarman,                  F
       (2019) 8 SCC 714, it is observed and held that the position of
       law that prevails after insertion of section 11(6A) is that Supreme
       Court or, as the case may be, the High Court, while considering
       any application under Sections 11(4) to 11(6) is to confine itself to
       examination of existence of arbitration agreement, nothing more,          G
       nothing less, and leave all other preliminary issues to be decided
       by arbitrator;
       ii) In the case of BCCI (supra), while interpreting section 26 of
       the Amended Act, 2015, this Court has observed in paragraphs 37
       to 39 as under:                                                           H
344   SUPREME COURT REPORTS                           [2023] 5 S.C.R.


A     “37. What will be noticed, so far as the first part is concerned,
      which states—
         “26. Act not to apply to pending arbitral proceedings.
         — Nothing contained in this Act shall apply to the arbitral
         proceedings commenced, in accordance with the provisions
B        of Section 21 of the principal Act, before the commencement
         of this Act unless the parties otherwise agree.…”
      is that: (1) “the arbitral proceedings” and their commencement
      is mentioned in the context of Section 21 of the principal Act;
      (2) the expression used is “to” and not “in relation to”; and (3)
C     parties may otherwise agree. So far as the second part of
      Section 26 is concerned, namely, the part which reads, “… but
      this Act shall apply in relation to arbitral proceedings
      commenced on or after the date of commencement of this
      Act” makes it clear that the expression “in relation to” is used;
      and the expression “the” arbitral proceedings and “in accordance
D     with the provisions of Section 21 of the principal Act” is
      conspicuous by its absence.
      38. That the expression “the arbitral proceedings” refers to
      proceedings before an Arbitral Tribunal is clear from the heading
      of Chapter V of the 1996 Act, which reads as follows:
E
                    “Conduct of arbitral proceedings”
      The entire chapter consists of Sections 18 to 27 dealing with
      the conduct of arbitral proceedings before an Arbitral Tribunal.
      What is also important to notice is that these proceedings alone
F     are referred to, the expression “to” as contrasted with the
      expression “in relation to” making this clear. Also, the reference
      to Section 21 of the 1996 Act, which appears in Chapter V,
      and which speaks of the arbitral proceedings commencing on
      the date on which a request for a dispute to be referred to
      arbitration is received by the respondent, would also make it
G     clear that it is these proceedings, and no others, that form the
      subject-matter of the first part of Section 26. Also, since the
      conduct of arbitral proceedings is largely procedural in nature,
      parties may “otherwise agree” and apply the Amendment Act
      to arbitral proceedings that have commenced before the
      Amendment Act came into force. [ Section 29-A of the Amend
H
M/S. SHREE VISHNU CONSTRUCTIONS v. THE ENGINEER IN                        345
 CHIEF MILITARY ENGINEERING SERVICE [M. R. SHAH, J.]

      (sic Amended) Act provides for time-limits within which an          A
      arbitral award is to be made. In Hitendra Vishnu Thakur v.
      State of Maharashtra, (1994) 4 SCC 602 at p. 633 : 1994
      SCC (Cri) 1087, this Court stated: (SCC p. 633, para
      26)”26. … (iii) Every litigant has a vested right in substantive
      law but no such right exists in procedural law.(iv) A procedural
                                                                          B
      statute should not generally speaking be applied retrospectively
      where the result would be to create new disabilities or
      obligations or to impose new duties in respect of transactions
      already accomplished.(v) A statute which not only changes
      the procedure but also creates new rights and liabilities shall
      be construed to be prospective in operation, unless otherwise       C
      provided, either expressly or by necessary implication.” It is,
      inter alia, because timelines for the making of an arbitral award
      have been laid down for the first time in Section 29-A of the
      Amendment (sic Amended) Act that parties were given the
      option to adopt such timelines which, though procedural in
                                                                          D
      nature, create new obligations in respect of a proceeding already
      begun under the unamended Act. This is, of course, only one
      example of why parties may otherwise agree and apply the
      new procedure laid down by the Amendment Act to arbitral
      proceedings that have commenced before it came into force.]
      In stark contrast to the first part of Section 26 is the second     E
      part, where the Amendment Act is made applicable “in relation
      to” arbitral proceedings which commenced on or after the date
      of commencement of the Amendment Act. What is
      conspicuous by its absence in the second part is any reference
      to Section 21 of the 1996 Act. Whereas the first part refers
                                                                          F
      only to arbitral proceedings before an Arbitral Tribunal, the
      second part refers to court proceedings “in relation to” arbitral
      proceedings, and it is the commencement of these court
      proceedings that is referred to in the second part of Section
      26, as the words “in relation to the arbitral proceedings” in the
      second part are not controlled by the application of Section 21     G
      of the 1996 Act.
      39. Section 26, therefore, bifurcates proceedings, as has been
      stated above, with a great degree of clarity, into two sets of
      proceedings — arbitral proceedings themselves, and court
      proceedings in relation thereto. The reason why the first part      H
346      SUPREME COURT REPORTS                           [2023] 5 S.C.R.


A        of Section 26 is couched in negative form is only to state that
         the Amendment Act will apply even to arbitral proceedings
         commenced before the amendment if parties otherwise agree.
         If the first part of Section 26 were couched in positive language
         (like the second part), it would have been necessary to add a
         proviso stating that the Amendment Act would apply even to
B
         arbitral proceedings commenced before the amendment if the
         parties agree. In either case, the intention of the legislature
         remains the same, the negative form conveying exactly what
         could have been stated positively, with the necessary proviso.
         Obviously, “arbitral proceedings” having been subsumed in the
C        first part cannot re-appear in the second part, and the
         expression “in relation to arbitral proceedings” would, therefore,
         apply only to court proceedings which relate to the arbitral
         proceedings. The scheme of Section 26 is thus clear: that the
         Amendment Act is prospective in nature, and will apply to those
         arbitral proceedings that are commenced, as understood by
D
         Section 21 of the principal Act, on or after the Amendment
         Act, and to court proceedings which have commenced on or
         after the Amendment Act came into force.”
          Thus, in the case of BCCI (supra), it is observed and held that
      the Amendment Act, 2015 is prospective in nature. However, it is
E     required to be noted that in the case of BCCI (supra), this Court
      was considering the proceedings under sections 34 and 36 of the
      Amendment Act, 2015 and to that while interpreting section 26, it
      is observed that the Amendment Act is prospective in nature, and
      will apply even to those arbitral proceedings that are commenced,
F     as understood by section 21 of the principal Act, prior to the
      Amendment Act, and to Court proceedings which have
      commenced on or after the Amendment Act came into force.
      iii) In the case of Parmar Construction Company (supra), in
      relation to application under section 11(6) of the Act, in a case
G     where notice for arbitration is received/invoked prior to the
      Amendment Act, 2015, but the application under section 11(6) of
      the Act is filed post Amendment Act, 2015, it is observed in
      paragraphs 25 to 28 as under:
         “25. As on 1-1-2016, the 2015 Amendment Act was gazetted
H        and according to Section 1(2) of the 2015 Amendment Act, it
M/S. SHREE VISHNU CONSTRUCTIONS v. THE ENGINEER IN                        347
 CHIEF MILITARY ENGINEERING SERVICE [M. R. SHAH, J.]

      was deemed to have come into force on 23-10-2015. Section           A
      21 of the 1996 Act clearly envisages that unless otherwise
      agreed by the parties, the arbitral proceedings in respect of a
      dispute shall commence from the date on which a request for
      that dispute to be referred to arbitration is received by the
      respondent and the plain reading of Section 26 of the 2015
                                                                          B
      Amendment Act is self-explicit, leaves no room for
      interpretation. Sections 21 and 26 of the 1996 Act/the 2015
      Amendment Act relevant for the purpose are extracted
      hereunder:
         “21. Commencement of arbitral proceedings.—Unless
         otherwise agreed by the parties, the arbitral proceedings in     C
         respect of a particular dispute commence on the date on
         which a request for that dispute to be referred to arbitration
         is received by the respondent.
                                      ***
                                                                          D
         26. Act not to apply to pending arbitral proceedings.—
         Nothing contained in this Act shall apply to the arbitral
         proceedings commenced, in accordance with the provisions
         of Section 21 of the principal Act, before the commencement
         of this Act unless the parties otherwise agree but this Act
         shall apply in relation to arbitral proceedings commenced        E
         on or after the date of commencement of this Act.”
      26. The conjoint reading of Section 21 read with Section 26
      leaves no manner of doubt that the provisions of the 2015
      Amendment Act shall not apply to such of the arbitral
      proceedings which have commenced in terms of the provisions         F
      of Section 21 of the principal Act unless the parties otherwise
      agree. The effect of Section 21 read with Section 26 of the
      2015 Amendment Act has been examined by this Court in
      Aravali Power Co. (P) Ltd. v. Era Infra Engg. Ltd. [Aravali
      Power Co. (P) Ltd. v. Era Infra Engg. Ltd., (2017) 15 SCC           G
      32 : (2018) 2 SCC (Civ) 642] and taking note of Section 26 of
      the 2015 Amendment Act laid down the broad principles as
      under : (SCC p. 53, para 22)
         “22. The principles which emerge from the decisions
         referred to above are:
                                                                          H
348   SUPREME COURT REPORTS                            [2023] 5 S.C.R.


A        22.1. In cases governed by the 1996 Act as it stood before
         the Amendment Act came into force:
         22.1.1. The fact that the named arbitrator is an employee
         of one of the parties is not ipso facto a ground to raise a
         presumption of bias or partiality or lack of independence on
B        his part. There can however be a justifiable apprehension
         about the independence or impartiality of an employee
         arbitrator, if such person was the controlling or dealing
         authority in regard to the subject contract or if he is a direct
         subordinate to the officer whose decision is the subject-
         matter of the dispute.
C
         22.1.2. Unless the cause of action for invoking jurisdiction
         under clauses (a), (b) or (c) of sub-section (6) of Section
         11 of the 1996 Act arises, there is no question of the Chief
         Justice or his designate exercising power under sub-section
         (6) of Section 11.
D
         22.1.3. The Chief Justice or his designate while exercising
         power under sub-section (6) of Section 11 shall endeavour
         to give effect to the appointment procedure prescribed in
         the arbitration clause.

E        22.1.4. While exercising such power under sub-section (6)
         of Section 11, if circumstances exist, giving rise to justifiable
         doubts as to the independence and impartiality of the person
         nominated, or if other circumstances warrant appointment
         of an independent arbitrator by ignoring the procedure
         prescribed, the Chief Justice or his designate may, for
F        reasons to be recorded ignore the designated arbitrator and
         appoint someone else.
         22.2. In cases governed by the 1996 Act after the
         Amendment Act has come into force : If the arbitration
         clause finds foul with the amended provisions, the
G        appointment of the arbitrator even if apparently in conformity
         with the arbitration clause in the agreement, would be illegal
         and thus the court would be within its powers to appoint
         such arbitrator(s) as may be permissible.”
      which has been further considered in S.P. Singla
H     Constructions (P) Ltd. case [S.P. Singla Constructions (P)
M/S. SHREE VISHNU CONSTRUCTIONS v. THE ENGINEER IN                            349
 CHIEF MILITARY ENGINEERING SERVICE [M. R. SHAH, J.]

      Ltd. v. State of H.P., (2019) 2 SCC 488 : (2019) 1 SCC (Civ)            A
      748] : (SCC p. 495, para 16)
         “16. Considering the facts and circumstances of the present
         case, we are not inclined to go into the merits of this contention
         of the appellant nor examine the correctness or otherwise of
         the above view taken by the Delhi High Court in Ratna                B
         Infrastructure Projects case [Ratna Infrastructure
         Projects (P) Ltd. v. Meja Urja Nigam (P) Ltd., 2017 SCC
         OnLine Del 7808] ; suffice it to note that as per Section 26
         of the Arbitration and Conciliation (Amendment) Act, 2015,
         the provisions of the amended 2015 Act shall not apply to
         the arbitral proceedings commenced in accordance with                C
         the provisions of Section 21 of the principal Act before the
         commencement of the Amendment Act unless the parties
         otherwise agree. In the facts and circumstances of the
         present case, the proviso in Clause (65) of the general
         conditions of the contract cannot be taken to be the                 D
         agreement between the parties so as to apply the provisions
         of the amended Act. As per Section 26 of the Act, the
         provisions of the 2015 Amendment Act shall apply in relation
         to arbitral proceedings commenced on or after the date of
         commencement of the 2015 Amendment Act (w.e.f. 23-
         10-2015). In the present case, arbitration proceedings               E
         commenced way back in 2013, much prior to coming into
         force of the amended Act and therefore, provisions of the
         amended Act cannot be invoked.”
      27. We are also of the view that the 2015 Amendment Act
      which came into force i.e. on 23-10-2015, shall not apply to            F
      the arbitral proceedings which have commenced in accordance
      with the provisions of Section 21 of the principal Act, 1996
      before the coming into force of the 2015 Amendment Act,
      unless the parties otherwise agree.
      28. In the instant case, the request was made and received by           G
      the appellants in the appeal concerned much before the 2015
      Amendment Act came into force. Whether the application was
      pending for appointment of an arbitrator or in the case of
      rejection because of no claim as in the instant case for
      appointment of an arbitrator including change/substitution of           H
350            SUPREME COURT REPORTS                         [2023] 5 S.C.R.


A              arbitrator, would not be of any legal effect for invoking the
               provisions of the 2015 Amendment Act in terms of Section 21
               of the principal Act, 1996. In our considered view, the
               applications/requests made by the respondent contractors
               deserve to be examined in accordance with the principal Act,
               1996 without taking resort to the 2015 Amendment Act which
B
               came into force from 23-10-2015.”
               In the case of Parmar Construction Company (supra), this
            Court heavily relied upon para 16 of the decision in the case of
            S.P. Singla Constructions Private Limited (supra).
C           iv) Then comes the decision of this Court in the case of Pradeep
            Vinod Construction Company (supra). In the said case, a three
            Judge Bench of this Court has followed the decision in the case
            of Parmar Construction Company (supra) and in the said
            decision it is specifically observed that unamended 1996 Act, i.e.,
            prior to Amendment Act, 2015 for appointment of arbitrator shall
D
            be applicable where the request to refer the dispute to arbitration
            was made before 2015 amendment came into effect.
            v) In the case of Ssangyong Engg. & Construction Co. Ltd.
            (supra), in which the decision in the case of BCCI (supra) was
            followed, it is observed and held that section 34, as amended, will
E           apply to only section 34 applications that have been made to the
            Court on or after 23.10.2015 irrespective of the fact that the
            arbitration proceedings may have commenced prior to that date.
            (See para 19). However, it is required to be noted that in the case
            of Ssangyong Engg. & Construction Co. Ltd. (supra), this Court
F           has followed the decision in the case of BCCI (supra) (See para
            17).
             8. It is the case on behalf of the appellant that therefore in the
      case of BCCI (supra), the decision which has been subsequently
      followed in the case of Ssangyong Engg. & Construction Co. Ltd.
G     (supra) and other decisions, it has been specifically observed and held
      that the Amendment Act, 2015 is prospective in nature. It is the case on
      behalf of the appellant that while taking a contrary view in the cases of
      Parmar Constructions Company (supra) and Pardeep Vinod
      Construction Company (supra), this Court had not noticed and/or
      considered the binding decision of this Court in the case of BCCI (supra)
H
M/S. SHREE VISHNU CONSTRUCTIONS v. THE ENGINEER IN                             351
 CHIEF MILITARY ENGINEERING SERVICE [M. R. SHAH, J.]

and therefore the decisions of this Court in the cases of Parmar               A
Constructions Company (supra) and Pardeep Vinod Construction
Company (supra) are per incuriam. It is also the case on behalf of the
appellant that so far as the decision in the case of Aravali Power
Company Private Limited (supra), which was considered by this Court
in the case of Parmar Constructions Company (supra) is concerned,
                                                                               B
in the said decision also, there is no reference to the decision in the case
of BCCI (supra). It is also the case on behalf of the appellant that
though in the case of S.P. Singla Constrictions Private Limited (supra),
there is a reference to the decision in the case of BCCI (supra), but in
the said decision paragraphs 38 and 39 are not referred to and/or
considered and except reproduction of para 37, there is no further             C
discussion in the case of BCCI (supra). Therefore, it is the specific
case on behalf of the appellant that as the decisions in the cases of
Parmar Constructions Company (supra) and Pardeep Vinod
Construction Company (supra) are per incuriam, we must hold that
in the present case Amendment Act, 2015 shall be applicable and therefore
                                                                               D
the High Court has committed a very serious error in opining on accord
and satisfaction which is not permissible as per the Amendment Act,
2015, i.e., Section 11(6A).
       9. Submission on behalf of the appellant, as above, seems to be
attractive but has no substance. This Court is required to consider whether
the decision in the cases of Parmar Constructions Company (supra)              E
and Pardeep Vinod Construction Company (supra) can be said to be
perincuriam as the decision of this Court in the case of BCCI (supra)
has not been considered by this Court in the said decisions. However, on
a fair reading of the decisions in the case of BCCI (supra) and the
observations made in paragraphs 37 to 39 and on a fair reading of              F
decisions in the cases of Parmar Constructions Company (supra)
and Pardeep Vinod Construction Company (supra), we are of the
opinion that this Court in the case of BCCI (supra) has held that the
Arbitration Amendment Act, 2015 is prospective in nature insofar as the
proceedings under sections 34 & 36 are concerned. It is required to be
noted that in the case of BCCI (supra), application under section 11(6)        G
was not the subject matter and there was no issue before the Court that
even in a case where the notice invoking the arbitration is issued prior to
the Amendment Act, 2015, but the application under section 11(6) is
filed post Amendment Act, 2015, what will be the position and whether
the old Act will be applicable or the amended Act. On the other hand,          H
352             SUPREME COURT REPORTS                            [2023] 5 S.C.R.


A     the decisions in the case of Parmar Constructions Company (supra)
      is directly on the point, namely, the application under section 11(6) of the
      Act. In the case of Parmar Constructions Company (supra), it is
      specifically observed and held that in a case where notice invoking
      arbitration is issued prior to Amendment Act, 2015 and the application
      under section 11(6) is filed post amendment, as per section 21 of the
B
      principal Act, the date of issuance of the notice invoking arbitration shall
      be considered as commencement of the arbitration proceedings and
      therefore as per section 26 of the Amendment Act, 2015, the Amended
      Act, 2015 shall not be applicable and the parties shall be governed by the
      pre-amendment Act, 2015.
C
             9.1 The submission on behalf of the appellant, as above, cannot
      be accepted for the simple reason that this Court in the case of BCCI
      (supra) was considering the court proceedings under sections 34 and
      36. To that, this Court interpreted section 26 in paragraphs 37 to 39,
      reproduced hereinabove, and held that the Amendment Act is prospective
D     in nature, and will apply to those arbitral proceedings that are commenced
      as understood by section 21 of the principal Act, on or after the
      Amendment Act, 2015 and to court proceedings which have commenced
      on or after the Amendment Act, 2015 came into force. Therefore, any
      observations made by this Court in paragraphs 37 to 39 in the case of
      BCCI (supra) shall be understood and construed with respect to court
E
      proceedings which have commenced on or after the Amendment Act
      coming into force, namely, the proceedings under sections 34 & 36.
      Therefore, the decisions of this Court in the cases of Parmar
      Constructions Company (supra) and Pardeep Vinod Construction
      Company (supra) cannot be said to be per incuriam and/or in conflict
F     with the decision of this Court in the case of BCCI (supra). As observed
      hereinabove, in the case of Parmar Constructions Company (supra)
      which is directly on the point, it is specifically observed and held that the
      2015 Amendment Act, which came into force w.e.f. 23.10.2015 shall
      not apply to the arbitral proceedings which are commenced in accordance
G     with the provisions of section 21 of the principal Act, 1996 before the
      coming into force the 2015 Amendment Act, unless parties otherwise
      agree (para 27). Similar view has been expressed in the case of S.P.
      Singla Constructions Private Limited (supra).
          10. Applying the law laid down by this Court in the cases of
      Parmar Constructions Company (supra) and Pardeep Vinod
H
M/S. SHREE VISHNU CONSTRUCTIONS v. THE ENGINEER IN                                353
 CHIEF MILITARY ENGINEERING SERVICE [M. R. SHAH, J.]

Construction Company (supra) and S.P. Singla Constructions Private                A
Limited (supra) to the facts of the case on hand as in the present case
the notice invoking arbitration clause was issued on 26.12.2013, i.e.,
much prior to the Amendment Act, 2015 and the application under Section
11(6) of the Act has been preferred/filed on 27.04.2016, i.e., much after
the amendment Act came into force, the law prevailing prior to the
                                                                                  B
Amendment Act, 2015 shall be applicable and therefore the High Court
has rightly entered into the question of accord and satisfaction and has
rightly dismissed the application under section 11(6) of the Act applying
the principal Act, namely, the Arbitration and Conciliation Act, 1996,
prevailing prior to the Amendment Act, 2015. We are in complete
agreement with the view taken by the High Court. It is observed and               C
held that in a case where the notice invoking arbitration is issued prior to
the Amendment Act, 2015 and the application under Section 11 for
appointment of an arbitrator is made post Amendment Act, 2015, the
provisions of pre-Amendment Act, 2015 shall be applicable and not the
Amendment Act, 2015.
                                                                                  D
       11. In view of the above and for the reasons stated above, the
present appeal fails and the same deserves to be dismissed and is
accordingly dismissed. However, in the facts and circumstances of the
case, there shall be no order as to costs.
                                                                                  E
Divya Pandey                                                  Appeal dismissed.
(Assisted by : Abhishek Agnihotri and Shevali Monga, LCRAs)




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