Stamp Act

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Arbitration Agreement

Introduction

The issue of enforceability of an arbitration clause contained in an unstamped/ insufficiently stamped agreement has been the subject of various judicial pronouncements. Conflicting decisions have been delivered by various High Courts and even the Supreme Court (“SC”) did not lay down a conclusive position. Recently though, a five judge bench of the apex court, through its judgment in N.N. Global Mercantile Private Limited v. Indo Unique Flame Limited[1] (“NN Global”), finally settled the law on enforceability of arbitration agreements contained in unstamped/ insufficiently stamped arbitration agreements.Continue Reading Enforceability of an Unstamped Arbitration Agreement

Arbitration Agreements in Unstamped Documents

Introduction

There has been constant confusion with respect to admissibility of unstamped documents. Section 35 of the Indian Stamp Act, 1899 (“Stamp Act”), provides that an unstamped or inadequately stamped document is inadmissible in evidence. Applying Section 35 of the Stamp Act, the Supreme Court in Garware Wall Ropes Ltd v. Coastal Marine Construction & Engineering Ltd [1](“Garware Judgement”) held that an arbitration agreement contained in an unstamped contract cannot be taken in evidence and invoked. It was further held that, in case the Court is faced with an unstamped document, it must proceed to impound the same, in accordance with the provisions of the Stamp Act; only once such an impounding is done — the deficit stamp duty and penalty paid, can the Court proceed on the basis of the arbitration agreement.
Continue Reading Invoking Arbitration Agreements in Unstamped Documents – A Case Comment on Garware Wall Ropes v. Coastal Marine Constructions & Engineering