The Group Of Companies Doctrine - Navigating The Commercial Reality In Indian Arbitration
- IJLLR Journal
- 10 minutes ago
- 1 min read
Ayush Pratihar, Jindal Global Law School
ABSTRACT
One of the most debated issues in Indian arbitration law, is when can the non-signatory to an arbitration agreement be required to be a party, or avail the benefits of an arbitration? This paper examines the doctrinal journey of the rigid privity-based approach prior to Chloro Controls India (P) Ltd v Severn Trent Water Purification Inc [2013], the judicial creativity of the post Chloro Controls period, and the constitutional rebalancing of the scales that the Supreme Court has brought in the balance in Cox and Kings Ltd v SAP India Pvt Ltd [2023]. The paper contends that the use of Chloro Controls was both necessary and not precise enough it was necessary because strict privity was ill-suited to address the commercial realities of the modern group-company transaction, but imprecise because the Court's reliance on the fiction of implied consent carried with it some theoretical instability. The reformulation of the Constitution provides a better jurisprudential grounding which is based on objective evidence of intent, agency, and actual involvement instead of fiction. The existing Indian stance, when seen in its right context, is a well-considered synthesis that is largely, but not entirely, consistent with dominant international arbitration jurisprudence.
