M.S Commercial And Others v. Calicut Engineering Works Ltd. .

Factual and Procedural Background

The respondents invoked arbitration and appointed an arbitrator. The petitioners disputed the existence of any arbitration agreement, contending they had not signed the documents containing the arbitration clause. To resolve this factual dispute, the petitioners requested that the disputed documents be examined by a handwriting expert. The arbitrator granted the request and invited both sides to suggest experts. Only the respondents supplied names, and the arbitrator selected an expert from their list. Two expert reports were submitted.

On 2 July 2003 the petitioners sought to set aside those reports and to have a new expert appointed, but the arbitrator refused. On 29 September 2003 the arbitrator ruled that an arbitration agreement existed. After that ruling, on 12 November 2003, the petitioners applied for permission to cross-examine the handwriting expert and/or to call another expert; this application was dismissed by the order dated 19 February 2004. The petitioners then filed the present special leave petitions challenging that order in the Supreme Court of India.

Legal Issues Presented

1. Whether, after the arbitrator had decided under Section 16 of the Arbitration and Conciliation Act, 1996 that an arbitration agreement existed, the petitioners could still seek to cross-examine the handwriting expert or lead additional expert evidence.
2. Whether the impugned order dismissing the petitioners’ post-decision application warranted interference by the Supreme Court under its special leave jurisdiction.

Arguments of the Parties

The opinion does not contain a detailed account of the parties' legal arguments.

Table of Precedents Cited

No precedents were cited in the provided opinion.

Court's Reasoning and Analysis

The Court noted that once the arbitrator determined the existence of an arbitration agreement, Section 16(5) of the Arbitration and Conciliation Act obliged the arbitrator to proceed to make an award. Consequently, the only statutory remedy available to the petitioners was to challenge the eventual award under Section 34 of the Act.

Because the petitioners never sought to cross-examine the handwriting expert before the arbitrator rendered his decision, the Court held that the opportunity to do so had lapsed. Allowing such a request after the Section 16 determination would undermine the statutory scheme, which channels objections to an award into post-award proceedings rather than piecemeal challenges.

The Court further observed that the petitioners could, if legally permissible, raise the earlier rejection of their July 2003 application when they challenge the final award, but they could not obtain interlocutory relief through the present special leave petitions.

Holding and Implications

The special leave petitions were dismissed; no order as to costs.

The immediate consequence is that the arbitration will proceed toward an award without further interference regarding the handwriting expert. The decision reaffirms that, once an arbitrator has ruled under Section 16 on jurisdiction or the existence of an arbitration agreement, parties must await the final award and then seek recourse under Section 34, rather than pursue separate challenges during the arbitral proceedings. No new legal precedent was created beyond this clarification.