The ‘composite transaction’ and extension of arbitration agreements in India

Kumar, Manasi (2020) The ‘composite transaction’ and extension of arbitration agreements in India. Journal of International Arbitration, 37 (3). pp. 363-390. ISSN 2558106

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In 2013, the Indian Supreme Court penned an innovative judgment in Chloro Controls v. Severn Trent Water Purification, where it appeared to fashion a new basis for extending
arbitration agreements to non-signatories – a ‘composite transaction’ doctrine. This article argues that the ‘composite transaction’ is in fact a two-tiered analysis. The first part addresses whether the arbitration agreement may be extended to a non-signatory that is an affiliate company of one of the signatories, using the somewhat controversial ‘group of companies’ doctrine. Meanwhile, the second part addresses whether the arbitration agreement that is invoked may be extended to disputes arising within a group of contracts. This article demonstrates that while the Indian Supreme Court is developing a consent-based ‘group of companies’ doctrine, its ‘group of contracts’ jurisprudence is losing sight of parties’ intent due to a misreading of the ‘composite transaction’ test. This article concludes that in order to develop a modern and versatile, consentbased analysis into extension of arbitration agreements, the Indian Supreme Court must recast the ‘composite transaction’ test as the two-tiered analysis it represents.

Item Type: Article
Keywords: Indian Arbitration and Conciliation Act, | Alternative Dispute Resolution | Arbitration extension of arbitration agreements | Group of Companies, | Group of Contracts | Composite Transaction | Chloro Controls
Subjects: Social Sciences and humanities > Social Sciences > Law and Legal Studies
JGU School/Centre: Jindal Global Business School
Depositing User: Amees Mohammad
Date Deposited: 28 Dec 2021 06:11
Last Modified: 13 Jan 2022 04:18
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