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2005 (8) TMI 622 - SC - Companies LawWhether the finding of the court made under Section 45 of the Indian Arbitration and Conciliation Act, 1996 that the arbitration agreement, falling within the definition of Section 44 of the Act, is or is not "null and void, inoperative or incapable of being performed" should be a final expression of the view of the court or should it be a prima facie view formed without a full-fledged trial? Held that:- An international commercial arbitration involves huge expenses, particularly where the parties have subjected the contract to a foreign law. But, that cannot be a deterrent to this Court from pronouncing on the correct approach to be adopted under Section 45 of the Act. In fact, as I have pointed out, adopting a final and determinative approach under Section 45 may not only prolong proceedings at the initial stage but also correspondingly increase costs and uncertainty for all the parties concerned. The present matter needs to be remitted to the trial court, but not for a full trial as directed by the impugned judgment of the High Court. The application under Section 45 would have to be determined by the trial court after arriving at the prima facie satisfaction that there exists an arbitral agreement, which is "not null and void, inoperative or incapable of being performed". If the trial court finds thus, the parties shall be referred to arbitration. The appeal is accordingly allowed and Ordered accordingly.
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