By s.

28 of the Indian Contract Act agreements in restraint of legal proceed

ings are declared void, subject however to the rule that a contract by which two
or more persons agree that any dispute which has arisen or which may arise betw
een them in respect of any subject or class of subjects shall be referred to arb
itration, is not illegal.
Supreme Court of India
Societe De Traction Et ... vs Kamani Engineering Company Ltd on 18 April, 1963
Equivalent citations: 1964 AIR 558, 1964 SCR (3) 116
Bench: S C.
PETITIONER:
SOCIETE DE TRACTION ET D'ELECTRICITE SOCIETE ANONYME
Vs.
RESPONDENT:
KAMANI ENGINEERING COMPANY LTD.
DATE OF JUDGMENT:
18/04/1963
BENCH:
SHAH, J.C.
BENCH:
SHAH, J.C.
BHAGWATI, P.N. (CJ)
WANCHOO, K.N.
GUPTA, K.C. DAS
AYYANGAR, N. RAJAGOPALA
CITATION:
1964 AIR 558 1964 SCR (3) 116
ACT:
Arbitration--Agreement between company registered under Indian Companies Act and
a Foreign compny to refer dispute to arbitration in accordance with the rules o
f International Chamber of Commerce--Indian Company flies civil suit disregardin
g the arbitrarion clause--Foreign Company applies for stay of proceedings--Wheth
er the agreement to refer to arbitration though a machinery outside Indian Act v
alid and enforceable--Companies Act, 1956 (I of 1956), ss. 389, 494 (b)--Arbitra
tion Act 1940 (X of 1940) ss. 34, 46, 47--Arbitration (Protocol and Convention)
Act, 1937 (VI of 1937), s. 3.