A non-signatory cannot be referred to arbitration without prima facie evidence of consent.

Respondent No. 1 appointed the Applicant as a subcontractor under four Work Orders dated 25 September 2017 for construction work at the “One Park Avenue” project; an Addendum followed on 17 February 2020.

The Applicant claimed outstanding payments and invoked arbitration under Clause 17 of the Work Orders.

Respondent No. 1 did not oppose reference, while Respondent No. 2 denied being a party to the arbitration agreement and Respondent No. 3 denied involvement in the relevant transaction.

The Applicant sought reference against all three Respondents.

Whether Respondent No. 2, a non-signatory with a corporate and commercial connection to Respondent No. 1 and the project, was prima facie a party to the arbitration agreement.

Whether Respondent No. 3 could be referred to arbitration based on its alleged connection with the project and the subsequent property transaction.

Whether the disputes between the Applicant and Respondent No. 1 were referable to arbitration under the Work Orders.

Section 11 of the Arbitration and Conciliation Act, 1996 empowers the Court to appoint an arbitrator where an arbitration agreement exists and a dispute is referable to it.

Under Cox and Kings Ltd. v. SAP India (P) Ltd., (2024) 4 SCC 1, a non-signatory may be bound where consent to arbitrate is established; commercial connection or common ownership alone is insufficient, and consent may be inferred from conduct and the parties’ relationship.

Hindustan Petroleum Corporation Ltd. v. BCL Secure Premises (P) Ltd., (2026) 3 SCC 711, requires the Referral Court to be prima facie satisfied that a non-signatory is a “veritable party” before referring it to arbitration; the issue cannot automatically be left to the tribunal.

Mukesh Patel v. Pant Nagar Ganesh Krupa Cooperative Housing Society Ltd., 2025 SCC OnLine Bom 6393, emphasises de facto privity and the foundational requirement of consent to arbitrate.

A person claiming “through or under” a signatory must have a derivative basis, such as assignment, subrogation or novation; mere legal or commercial connection is insufficient.

Respondent No. 1 and the Applicant were the parties to the Work Orders and Addendum, and the Applicant raised its bills and payment demand against Respondent No. 1.

Although Respondent No. 2 participated in project discussions and communications and was connected to Respondent No. 1, the record did not show that it assumed Respondent No. 1’s obligations or consented to Clause 17; those circumstances established project involvement, not consent to arbitrate.

Respondent No. 3 was not shown to have acquired the property: the Sale Certificates named Purva Oak Private Limited as purchaser, and no assignment, novation or succession binding Respondent No. 3 to the arbitration agreement was established.

The Court therefore found no prima facie basis to refer Respondent Nos. 2 or 3 to arbitration, while the arbitration agreement and dispute between the Applicant and Respondent No. 1 were established.

It declined to refer Respondent Nos. 2 and 3 to arbitration, without deciding whether the Applicant might have an independent remedy against either of them.

The arbitrator may determine the merits, claims and any counterclaims.