Hitachi Energy-ABB Barauni Dispute Goes To Arbitration As Karnataka HC Prima Facie Finds JOPA Clause Covers Subcontract

IOCL awarded the Barauni Refinery Project contract to ABB India Limited. After IOCL declined to novate the contract to Hitachi Energy India Limited, the parties entered into a subcontract dated 7 December 2020 under which Hitachi undertook project execution.

The subcontract referred to the Joint Operational Protocol Agreement dated 9 March 2021 (JOPA), described JOPA as an integral part of the subcontract, and provided for JOPA to prevail in the event of inconsistency; JOPA contained an arbitration clause in Clause 13.

Following disputes, Hitachi invoked Clause 13 and applied under Section 11(6) of the Arbitration and Conciliation Act, 1996, for appointment of a sole arbitrator. ABB disputed that the subcontract incorporated JOPA’s arbitration clause.

Section 7(5) of the Arbitration and Conciliation Act, 1996 provides that a written reference to a document containing an arbitration clause constitutes an arbitration agreement where the reference makes that clause part of the contract.

A general reference to an independent contract will ordinarily not incorporate its arbitration clause, but a general reference to an adopted consensual standard-form contract—including a party’s own standard terms—may do so; the arbitration clause must apply to disputes under the adopting contract and be consistent with its terms (*M.R. Engineers & Contractors (P) Ltd. v. Som Datt Builders Ltd.*, (2009) 7 SCC 696; *INOX Wind Ltd. v. Thermocables Ltd.*, (2018) 2 SCC 519).

The standard-contract principle was also applied in *Giriraj Garg v. Coal India Ltd.*, (2019) 5 SCC 192.

*NBCC (India) Ltd. v. Zillion Infraprojects (P) Ltd.*, 2024 INSC 218, was distinguished on its facts.

At the Section 11 stage, the Court’s inquiry into the existence of an arbitration agreement is limited but does not permit appointment in the absence of an agreement (*SBI General Insurance Co. Ltd. v. Krish Spinning*, 2024 INSC 532).

The Court found that JOPA functioned as the parties’ standard intercompany framework for projects that had not been novated, while the subcontract applied that framework to the Barauni project.

The parties had agreed to JOPA’s terms before executing the subcontract; its later registration did not make it a subsequent agreement.

Read together, the subcontract’s provisions making JOPA an integral part and giving it precedence in cases of inconsistency showed adoption of JOPA as a governing standard-form framework—not merely a reference to isolated operational or payment arrangements.

Clause 13 was therefore part of the subcontract and applicable to the dispute; its omission from the subcontract’s text did not defeat incorporation under Section 7(5).

It allowed the petition and appointed Justice V. Gopala Gowda, former Judge of the Supreme Court of India, as sole arbitrator at the Arbitration and Conciliation Centre (Domestic & International), Bengaluru; the parties’ claims and contentions were left open.