SC dismisses govt plea on RIL arbitration

The Supreme Court on Tuesday dismissed the petition of the central government, seeking removal of arbitrator Peter Lever in its dispute with Reliance Industries Ltd in the Panna-Mukta-Tapti basin. Lever was nominated by Reliance and British Gas.

The government opposed his nomination on the ground of bias. By rejecting the plea, a bench headed by Justice A K Sikri allowed Lever to continue as an arbitrator in London. The court also rejected the plea that the arbitration must take place in this country instead of London.

Last week, the same bench had rejected the application of ONGC, which opposed London as the venue of arbitration in the multi-party dispute over recovery of cost, royalty and tax. The court had observed that if it had any grievance, it could join the arbitration, which was mooted in 2010, as the corporation was not a party to the litigation earlier.

The judgment also clarified certain legal points regarding the place of arbitration in international contracts. The judgment delivered a few years ago in the Bhatia International case had created some doubts in international arbitration procedures.

The present judgment took the opportunity to interpret the law in this grey area.