Case Comment on National Thermal Power Corporation V. Siemens Atkeingesellschaft

The matter of the National Thermal Power Corporation v. Siemens Atkeingesellschaft deals with the analysis of section 16(2) and 16(3) along with section 37(2) of the Arbitration and Conciliation Act, 1996.

This case is very significant in the study of Indian Arbitration and Conciliation Law as it delves into the intricacies of the meaning of Jurisdiction. The expression jurisdiction used in this section is very wide in its amplitude. It was determined in a case dealing with an article of the ICC rules which were similar to S.16 that there was no reason to try and cut down the width of the intended meaning of the term jurisdiction.

It is interesting to note that neither Article 16 of the Model Law provided by Uncitral, which is regarded as one of the pillars of the Model Law nor Section 16 of the Indian Arbitration and Conciliation Act, 1996 provides a definition for the term jurisdiction. It has been referred to as 'authority, mandate or competence.'

If a Tribunal declines jurisdiction or declines to pass an award and dismisses the arbitral proceedings, the party aggrieved is not without a remedy. Section 37(2) deals with such a situation. Where the plea of absence of jurisdiction or a claim being in excess of jurisdiction is accepted by the Arbitral Tribunal and it refuses to go into the merits of the claim by declining jurisdiction, a direct appeal is provided. In the context of Section 16 and the specific wording of Section 37(2)(a) of the Act, it would be appropriate to hold that what is made directly appealable by Section 37(2)(a) of the Act is only an acceptance of a plea of absence of jurisdiction, or of excessive exercise of jurisdiction and the refusal to proceed further either wholly or partly.

The question addressed by the judgment in the instant case is whether in a situation where a counter claim is referred to and a plea that the counter claim does not survive in view of the settlement of disputes between the parties earlier arrived at is in fact a decision to not exercise jurisdiction as provided for in S. 16 and whether once accepted this decision can be appealed against under S. 32 of the Arbitration and Conciliation Act, 1996.

ISSUES RAISED

The matter was brought up before the Supreme Court of India by the National Thermal Power Corporation in appeal from the decision of the High Court in reference to the rejection by the tribunal of the counter-claims of the NTPC.

1. The main issue raised by this appeal was whether it was an exercise of the Arbitral Tribunal's jurisdiction under the contract to hear the counterclaims raised by the Respondent as envisaged under Section 16 of the Arbitration and Conciliation Act, 1996?

2. Furthermore could an appeal be sought under Section 37(2) of the Arbitration and Conciliation Act, 1996, against this alleged exercise of Jurisdiction?

3. Further the merits were to be analysed regarding whether the record of Minutes of Meeting dated 6 and 7 April 2000 preclude the Respondent from raising counterclaims and whether the said minutes constitute a binding an enforceable agreement between the parties and whether the counterclaims of the Respondent were time-barred?

This appeal raises an important question of law, namely, its maintainability under the provisions of Section 37 of the Act. The question of maintainability of the present appeal under the provisions of Section 37(2)(a) of the Act would in turn depend on the answer to the