SC Strikes Down Section 87 Of Arbitration & Conciliation Act Inserted By 2019 Amendment [Updated With Judgment]
5 years, 3 months ago

SC Strikes Down Section 87 Of Arbitration & Conciliation Act Inserted By 2019 Amendment [Updated With Judgment]

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In a significant judgment, the Supreme Court on Wednesday struck down Section 87 of the Arbitration and Conciliation Act 1996, which was inserted through the 2019 amendment Act passed by the Parliament last monsoon session.The judgment was delivered in the case Hindustan Construction Company Ltd v Union of India, which was heard by a bench comprising Justices R F Nariman, Surya Kant and. In a significant judgment, the Supreme Court on Wednesday struck down Section 87 of the Arbitration and Conciliation Act 1996, which was inserted through the 2019 amendment Act passed by the Parliament last monsoon session. In this backdrop, the bench concluded : "The result is that the BCCI 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" In fact, the Kochi Cricket Club judgment had criticized the the move of the Government to introduce Section 87 through Amendment as follows : "The Government will be well-advised in keeping the aforesaid Statement of Objects and Reasons in the forefront, if it proposes to enact Section 87 on the lines indicated in the Government's press release dated 7th March, 2018. The immediate effect of the proposed Section 87 would be to put all the important amendments made by the Amendment Act on a back-burner, such as the important amendments made to Sections 28 and 34 in particular, which, as has been stated by the Statement of Objects and Reasons, ".have resulted in delay of disposal of arbitration proceedings and increase in interference of courts in arbitration matters, which tend to defeat the object of the Act", and will now not be applicable to Section 34 petitions filed after 23rd October,2015, but will be applicable to Section 34 petitions filed in cases where arbitration proceedings have themselves commenced only after 23rd October, 2015.

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