Orders Rejecting Jurisdictional Pleas Under Section 16 are Not Amenable to Writ Jurisdiction or Intermediate Appeal

The Petitioner and Respondent were parties to an arbitration regarding a dispute over an Agreement of Sale dated 25.08.2021.

The Petitioner filed an application under Section 16 of the Arbitration and Conciliation Act (A Act), 1996, contending that the agreement was fabricated and her signatures were forged, thereby challenging the Arbitral Tribunal's jurisdiction.

The Sole Arbitrator rejected this application on 06.03.2026, observing that the issue of execution and forgery would be determined during the trial under the formulated points for consideration.

The Petitioner challenged this rejection through a Writ Petition under Article 227 of the Constitution of India.

1. Whether a writ petition is maintainable challenging an order passed by an Arbitral Tribunal rejecting a jurisdictional plea under Section 16 of the Arbitration and Conciliation Act, 1996?

Section 16 of the Arbitration and Conciliation Act, 1996, which embodies the principle of kompetenz-kompetenz, allowing a Tribunal to rule on its own jurisdiction.

Under Section 16(5), if a jurisdictional plea is rejected, the Tribunal must continue proceedings and make an award.

Section 16(6) and Section 34 provide that the remedy for such rejection is to challenge the final award.

Section 37, which restricts appeals to specific orders, notably allowing an appeal only when a Section 16 plea is accepted (terminating proceedings), but not when it is rejected.

The Court reasoned that the A Act is a self-contained code designed to minimize judicial intervention and prevent the fragmentation of challenges.

It observed that while Section 37(2)(a) allows an appeal against the acceptance of a jurisdictional plea to protect the party asserting the agreement's existence, the statute deliberately omits a right of appeal against a rejection to ensure the arbitral process continues unhindered.

The Court found that the Petitioner’s allegations of forgery were not pure questions of law but were deeply intertwined with factual evidence that overlapped with the merits of the case.

Therefore, a "trial within a trial" at the Section 16 stage was inappropriate.

The Court emphasized that judicial scrutiny is statutorily postponed until the stage of setting aside the award under Section 34.

It ruled that an order rejecting a plea under Section 16 cannot be independently challenged mid-proceedings and must be assailed alongside the final award under Section 34.

The petition was disposed of, granting parties the liberty to adduce evidence regarding forgery before the Arbitrator and reserving the Petitioner's right to challenge the finding in future Section 34 proceedings.