YOGRAJ INFRASTRUCTURE LTD. versus SSANG YONG ENGINEERING AND CONSTRUCTION CO. LTD.

Citation: [2011] 14 S.C.R. 301 · Decided: 01-09-2011 · Supreme Court of India · Bench: ALTAMAS KABIR · Disposal: Dismissed

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Judgment (excerpt)

[2011] 14 (ADDL.) S.C.R. 301 
YOGRAJ INFRASTRUCTURE LTD. 
v. 
SSANG YONG ENGINEERING AND CONSTRUCTION CO. 
LTD. 
(Civil Appeal No. 7562 of 2011) 
SEPTEMBER 01, 2011 
[ALTAMAS KABIR AND CYRIAC JOSEPH, JJ.] 
International Arbitration Act, 2002: 
International Commercial Arbitration - Held: Where the 
arbitration agreement provides that the seat of arbitration is 
Singapore and arbitration proceedings are to be conducted 
A 
B 
c 
in acco.rdance with the Singapore International Arbitration 
Centre Rules (SIAC Rules) then the International Arbitration 0 
Act, 2002 of Singapore will be the law of arbitration as is 
provided in rule 32 of S/AC Rules - Once the arbitrator is . 
appointed and the arbitral proceedings are commenced, the 
SIAC Rules become applicable shutting out the applicability 
of s.42 of Arbitration and Conciliation Act, 1996 and for that 
matter Part I of the 1996 Act, including the right of appeal u/ E 
s.37 thereof.:... Arbitration and Conciliation Act, 1996 - ss.2, 
9, 42 - Singapore International Arbitration Centre Rules -
r.32. 
Proper law and Curial law - Distinction between -
F 
Discussed. 
Arbitral Tribunal - Applicable law - Held: While the 
proper law is the law which governs the agreement itself, in 
the absence of any other stipulation in the arbitration clause G 
as to which law would apply in respect of the arbitral 
proceedings, it is the law governing the contract which would 
a/so be the law applicable to the Arbitral Tribunal itself. 
On 12th April, 2006, the National Highways Authority 
301 
H 
302 
SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R. 
A of India, New Delhi (NHAI) awarded a work contract to a 
Korean company (respondent) for upgrading the laning 
system. On 13th August, 2006, the respondent entered 
into a sub-contract with an Indian company (appellant) 
for carrying out the entire project. Clauses 27 and 28 
8 provided for arbitration and the governing law agreed to 
was the Arbitration and Conciliation Act, 1996. The 
appellant furnished Bank Guarantees to the Respondent 
and it also invested huge amount in the project. On 22nd 
September, 2009, the respondent issued a notice of 
C termination of the agreement, inter alia, on the ground of 
delay in performing the work under the agreement. The 
settlement talks between the parties failed and the 
respondent invoked arbitration clause in accordance with 
the Singapore International Arbitration Centre Rules 
(SIAC Rules). A sole arbitrator was appointed by SIAC. 
D Before the arbitrator, the respondent filed a Statement of 
Claim. Both the parties filed applications before the 
arbitrator seeking interim relief under Rule 17 of the SIAC 
Rules. In their application for interim relief, the 
respondent prayed for release of plants, machineries and 
E equipment belonging to the respondent; injunction 
against the appellant from removing all plants, 
machineries, equipment, materials, aggregates, etc., 
owned by the respondent from the work site; a restraint 
order against the appellant from creating any third party 
F interest or otherwise sell, lease, charge the plants, 
machineries, equipment, materials (PME)etc., at the work 
site and to permit the respondent to use the PMEs and 
materials, aggregates, etc. 
G 
The arbitrator directed the appellant to release all 
plants, machineries and equipment for use by the 
respondent. The appellant was also regtrained from 
creating any third party interest, or otherwise to deal with 
the properties at the work site and/or camp site. He also 
H recorded that the interim orders were being made with the 
YOGRAJ INFRASTRUCTURE LTD. v. SSANG YONG 
303 
ENGINEERING AND CONST. CO. LTD. 
object of allowing the construction work on the project 
A 
to continue. 
Aggrieved, the appellant filed appeal before the 
District Court under Section 37 of the Arbitration and 
Conciliation Act, 1996 which was dismissed on the 
ground of non-maintainability and lack 'of jurisdiction. 
B 
The revision petition filed against the said order was 
dismissed by the High Court. While dismissing the 
revision petition, the High Court observed that under 
Clause 27.1 of the Agreement, the parties had agreed to 
C 
resolve their dispute under the provisions of SIAC Rules 
which expressly or, in any case, impliedly also adopted 
Rule 32 of the said Rules which categorically indicated 
that the law of arbitration under the said Rules would be 
the International Arbitration Act, 2002, of Singapore. As. D 
far as appli

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