In a landmark judgment accepting the concept of ‘two tier arbitration’ or ‘second instance arbitration’, a three judge bench of the Supreme Court comprising of Justices Madan B. Lokur, R.K Agrawal and D.Y Chandrachud answering a reference made in 2006 due to divergence of opinions between Justice S.B.Sinha and Tarun Chatterjee, held that arbitration clauses which provide for a two- step arbitration process are valid under Indian arbitral jurisprudence. In a nutshell, brief facts of the dispute are that M/s. Centrotrade Minerals and Metal Inc., and the Hindustan Copper Limited, entered into a contract for sale of 15,500 DMT of Copper Concentrate to be delivered at Kandla Port in the State of Gujarat in two separate consignments.After the consignments were delivered, the payments therefor had been made. However, a dispute arose between the parties as regard the dry weight of concentrate copper. Clause 14 of the contract contained an arbitration agreement which read: “All disputes or diff...