Arbitral Proceedings Conducted During An IBC Moratorium: Nullity Or Continuity? A Case Note On Ankhim Holdings Pvt. Ltd. V. Zaveri Construction Pvt. Ltd.
Shreya Das, B.A. LL.B., KIIT School of Law
ABSTRACT
Supreme Court made a very significant comment in Ankhim Holdings Pvt. Ltd. v. Zaveri Construction Pvt. Ltd, that a court exercising the narrow substitution jurisdiction under section 15(2) of the Arbitration and Conciliation Act, 1996 cannot retrospectively declare arbitral proceedings a nullity merely because they were conducted during a moratorium under section 14 of the Insolvency and Bankruptcy Code, 2016. This case note argues that the judgment should be read only as deciding a narrow jurisdictional issue, namely whether section 15(2) applies and not as a substantive pronouncement addressing the broader issue of the effect of a moratorium on ongoing arbitral proceedings. However, later commentators, like the Telangana High Court, have treated similar issues with judgments that almost answer that broader question, which risks the misinterpretation of the exception recognised by the Supreme Court in Indus Biotech Pvt. Ltd. v. Kotak India Venture Fund without any deserving doctrinal scrutiny. The note concludes with an argument on the unresolved paradox the judgment has left behind, referring to a larger bench on the substantive question by the apex court in the eyes of Article 142 of the Indian Constitution.
Keywords: Arbitration and Conciliation Act 1996; Insolvency and Bankruptcy Code 2016; moratorium; section 15(2); competence; Indus Biotech.
