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Showing posts with the label termination of agreement

Arbitration clause remains operative even where agreement terminated by mutual consent

The Supreme Court in Mrs. Hema Khattar & ANR. Vs. Shiv Khera has held that When an agreement is terminated by one party alleging breach committed by the other, the arbitration clause still survives and continues to be operative. This is particularly so when the contract is revoked by mutual consent and the arbitration clause is framed in general terms. The Supreme Court referred to earlier decisions in Sundaram Finance Limited and Another vs. T. Thankam (2015) 14 SCC 444, where this Court has held as under:- "8. Once there is an agreement between the parties to refer the disputes or differences arising out of the agreement to arbitration, and in case either party, ignoring the terms of the agreement, approaches the civil court and the other party, in terms of Section 8 of the Arbitration Act, moves the court for referring the parties to arbitration before the first statement on the substance of the dispute is filed, in view of the peremptory language of Section 8 of th...