Giriraj Garg vs Coal India Ltd. & Ors.
AIR 2019 Supreme Court 1015; 2019 INSC 211
Coram: Hon’ble Justice Uday Umesh Lalit & Hon’ble Justice Indu Malhotra
Forum: Hon’ble Supreme Court of India
Case No.: Civil Appeal No. 1695 of 2019 (Arising out of SLP (Civil) No. 28693 of 2018
Date of Decision: February 15, 2019

Facts & Background:

  • Giriraj Garg, a registered buyer under the 2007 Scheme for coal distribution through e-auction, aimed at providing access to coal through a transparent and single-window mechanism, was Appellant.
  • Coal India Limited (CIL) and its subsidiaries, responsible for implementing the 2007 Scheme for coal distribution through e-auctions, were Respondent.
  • Disputes arose when the Appellant failed to lift the booked coal within the stipulated 45 days under the 2007 Scheme. This led to Coal India Limited forfeiting his Earnest Money Deposit (EMD), which he contested by invoking the arbitration clause.
  • The Appellant applied Section 11 of the Arbitration and Conciliation Act, 1996, before the Jharkhand High Court, seeking the appointment of an independent arbitrator. The High Court rejected the application, holding that the arbitration clause in the 2007 Scheme was not incorporated by reference in individual sale orders.
  • Aggrieved with the High Court's decision, the Appellant approached the Supreme Court, contesting the rejection of his arbitration claim and seeking to enforce the arbitration clause under the 2007 Scheme.

Main Issue:

  • Will the arbitration clause contained in the 2007 Scheme be incorporated by reference in each sale order?