In a telling take on the arbitration landscape in India, the Supreme Court on Tuesday remarked that arbitration is leading to litigation at every stage [NMDC Steel v. Danieli]..A Bench of Chief Justice of India Surya Kant and Justices Ujjal Bhuyan and N Kotiswar Singh made the observation while hearing objections to an International Court of Arbitration tribunal’s decision to move the hearing of a dispute from India to London.“The problem in arbitration is now that at every stage it generates litigation,” CJI Kant remarked. .The Bench was examining how an arbitration agreement that expressly fixed Hyderabad as the venue had resulted in hearings taking place in Delhi and a final sitting scheduled at the International Dispute Resolution Centre (IDRC) in London. The Court noted that the arbitration clause, the International Chamber of Commerce (ICC) terms of reference and Article 18 of the ICC Rules all confirmed Hyderabad as the venue. The judges questioned how the process had shifted across jurisdictions without a single hearing taking place at the agreed location..NMDC Steel Limited had approached the Telangana High Court in October 2025 challenging an order passed by the arbitral tribunal in an ICC arbitration. The tribunal had decided on September 15, 2025 to shift the closing hearing from New Delhi to the IDRC, London.On October 7, 2025, a Division Bench of Justices Moushumi Bhattacharya and Gadi Praveen Kumar granted limited interim protection to NMDC. The Bench noted prima facie concerns about the tribunal’s reasoning, observing that:The arbitration agreement designated Hyderabad, India as the venue;The tribunal’s order did not reflect NMDC’s proposal of Hyderabad as an alternative;Under Section 20 of the Arbitration and Conciliation Act and Article 18 of the ICC Rules, the parties’ convenience prevails over tribunal convenience; andMost parties were India-based, making it “inconceivable” that no venue in New Delhi or Hyderabad could host the hearing.The High Court described the shift to London as potentially perverse and prima facie beyond the tribunal’s authority. It, however, refused to stay the arbitration and only restrained the tribunal from finalising London bookings pursuant to an email instructing the parties to confirm reservations by 6 PM on October 5, 2025. The issue of maintainability was expressly left open.When the respondents later produced additional correspondence -including NMDC’s participation in an earlier evidentiary hearing in London and messages indicating openness to Singapore or London as venues - the narrative altered. On November 20, 2025, the same Bench dismissed the writ petition on the ground of maintainability..The Supreme Court today questioned why domestic venues were not explored after the tribunal found Delhi hotels expensive. The judges asked, “What is the problem that you first enter into an agreement for India then you try to wriggle out only because of the luxury of certain members,” noting that India has multiple cities capable of hosting large arbitral hearings..The judges signalled that they did not wish to issue a ruling that might unsettle India’s arbitration ecosystem, stressing the need to promote confidence in domestic venues. CJI Kant said, "The international arbitration community may think that Indian courts are very conservative. We don't want that kind of message to be given.".The Court asked the parties to return with proposals for an Indian venue that would allow the scheduled December sittings to proceed. The matter is expected to be taken up tomorrow. .NMDC was represented by Solicitor General Tushar Mehta with Advocates Nidhi Mittal, Gurjas Narula and Jaya Choudhary. .The respondents were represented by Senior Advocate Shyam Divan..Follow Bar and Bench channel on WhatsAppDownload the Bar and Bench Mobile app for instant access to the latest legal news.
