Delhi HC allows AgustaWestland to withdraw arbitration proceedings

New Delhi: The Delhi High Court on Thursday allowed AgustaWestland to withdraw proceedings against the central government at the arbitration tribunal.

AgustaWestland had invoked the arbitration process after the government terminated the Rs 3,600 crore deal with the Anglo-Italian firm for purchase of 12 VVIP choppers over allegations of kickbacks.

The Ministry of Defence (MoD) moved the Delhi High Court challenging the arbitration proceedings.

on Thursday, AgustaWestland told Justice Prathiba M. Singh it would seek legal remedies before a civil court instead of the arbitration tribunal, and requested the court to allow it to withdraw the petition before the arbitration tribunal.

The court accepted the plea and allowed the company to withdraw the petition within two weeks.

At the last hearing, Additional Solicitor General (ASG) Pinky Anand had told the court various allegations were raised in respect of the transaction. She said a tribunal couldn’t hear the matter as allegations of corruption, fraud and bribery had surfaced.

The ASG told the court the arbitral proceedings deserved to be stayed as the mandate of the tribunal stood terminated in terms of Section 29A of the Arbitration and Conciliation Act, 1996.

Senior Counsel Arun Kathpalia, appearing for AgustaWestland, submitted the case was not governed by the provisions of Section 29A of the Arbitration and Conciliation Act, in as much as the arbitral proceedings had started much before the amended Act came into force.

Section 29A of the Arbitration and Conciliation Act seeks to impose a 12-month time limit on the conduct of arbitration. It mandates that an award shall be passed within 12 months of the arbitral tribunal entering upon the reference.