Hon'ble Judges/Coram:
S.H. Kapadia, C.J.I., Devinder Kumar Jain, S.S. Nijjar, Ranjana Prakash Desai and J.S. Khehar

JUDGMENT

S.S. Nijjar, J.

1. Whilst hearing C.A. No. 7019 of 2005, a two Judge Bench of this Court, on 16^th January, 2008, passed the following order:

In the midst of hearing of these appeals, Learned Counsel for the Appellant has referred to the three-Judges Bench decision of this Court in Bhatia International v. Bulk Trading S.A. and Anr. MANU/SC/0185/2002 : (2002) 4 SCC 105. The said decision was followed in a recent decision of two Judges Bench in Venture Global Engineering v. Satyam Computer Services Ltd. and Anr. MANU/SC/0333/2008 : 2008 (1) Scale 214. My learned brother Hon'ble Mr. Justice Markandey Katju has reservation on the correctness of the said decisions in view of the interpretation of Clause (2) of Section 2 of the Arbitration and Conciliation Act, 1996. My view is otherwise.

Place these appeals before Hon'ble CJI for listing them before any other Bench.

2. Pursuant to the aforesaid order, the appeal was placed for hearing before a three Judge Bench, which by its order dated 1^st November, 2011 directed the matters to be placed before the Constitution Bench on 10^th January, 2012.

3. Since the issue raised in the reference is pristinely legal, it is not necessary to make any detailed reference to the facts of the appeal. We may, however, notice the very essential facts leading to the filing of the appeal. An agreement dated 22^nd April, 1993 was executed between the Appellant and the Respondent, under which the Respondent was to supply and install a computer based system for Shelter Modernization at Balco's Korba Shelter. The agreement contained an arbitration clause for resolution of disputes arising out of the contract. The arbitration clause contained in Articles 17 and 22 was as under:

Article 17.1 - Any dispute or claim arising out of or relating to this Agreement shall be in the first instance, endeavour to be settled amicably by negotiation between the parties hereto and failing which the same will be settled by arbitration pursuant to the English Arbitration Law and subsequent amendments thereto.

Article 17.2 - The arbitration proceedings shall be carried out by two Arbitrators one appointed by BALCO and one by KATSI chosen freely and without any bias. The court of Arbitration shall be held wholly in London, England and shall use English language in the proceeding. The findings and award of the Court of Arbitration shall be f........