Arbitration agreement does not need registration: SC
August 1, 2011
The Supreme Court of India recently heard the case, SMS Tea Estates Ltd vs Chandmari Tea Co. which arose over a 30-year lease of two tea estates between the parties. The court determined that even if the deed is compulsorily registerable, an arbitration agreement with an unregistered deed can still be enforced and acted upon for dispute resolution.
Pleas to apply for arbitration were denied at the trial and appellate level but the Supreme Court stated that even if the deed was not registered, the arbitration clause could be enforced. It found that even if there was a clause in the contract requiring the deed to be registered, the agreement to arbitrate is “an independent agreement to refer the disputes to arbitration.”