When a review petition is dismissed by the highest court of the land – the Supreme Court, all does not come to an end. The Supreme Court in true exercise of its supreme powers grants one last constitutional remedy – the curative petition1. The remedy is based on the premise that an act of the court shall prejudice no one – actus curiae neminem gravabit.2

This remedy was invoked once again in Re: Interplay Between Arbitration Agreements under the Arbitration and Conciliation Act, 1996 and the Indian Stamp Act, 18993 ("Curative Petition"), wherein a seven-Judge constitutional bench has unequivocally declared that the failure to pay stamp duty on the underlying contract does not render the arbitration agreement invalid, unenforceable, or non-existent. This ruling reaffirms the parameters of judicial interference in matters of arbitration and the authority vested with the arbitral tribunal.


It is interesting to take note of the series of judgments where the Supreme Court has been called upon to determine the impugned issue. In N. N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd4 ("N.N. Global 1"), a three Judge bench concluded that an arbitration agreement is separate and distinct from the underlying contract, therefore, it would not be rendered invalid, unenforceable, or non-existent as non-payment of stamp-duty is a curable defect. However, since there were diverging views of different benches of the Supreme Court on the issue5, the three Judge bench made a reference to a constitutional bench of five Judges of the Supreme Court to conclusively determine whether the arbitration agreement, would be rendered non-existent, unenforceable, or invalid, pending payment of stamp duty on the underlying contract/ instrument. Subsequently, in N. N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd6 ("N.N. Global 2"), it was held by a 3:2 majority that an unduly stamped instrument containing inter alia an arbitration agreement is void and unenforceable in law.

The judgement given in N. N. Global 2 effectively nullifies the legislative intent of the Arbitration and Conciliation Act, 1996 ("Arbitration Act") for the following reasons:

  1. it undercuts the restriction on the extent of judicial intervention permitted under the Arbitration Act. It allows courts to impound an instrument in case of deficiency in stamping at the referral stage, thereby impinging upon the jurisdiction of the arbitral authority to determine the adequacy of stamping;
  2. takes away the powers expressly granted to arbitral tribunals to rule upon its own jurisdiction including determination of existence and validity of an arbitration agreement;
  3. fails to give effect to the doctrine of separability7, as laid down in the Arbitration Act8, by holding that non-stamping of the underlying contract would ipso facto invalidate the arbitration agreement contained in such contract; and
  4. prioritizes the objective of the Indian Stamp Act, 1899 ("Stamp Act"), that is, collection of revenue for the state, at the cost of the Arbitration Act.

This article aims to extract and elucidate the pivotal observations made by the Apex Court in arriving at its decision in the Curative Petition.

1. Non-stamping or improper stamping is a curable defect

The Stamp Act is a fiscal legislation aimed at securing revenue for the state. It empowers every person authorized to receive evidence (either by law or by consent of parties) to impound an instrument which is, in their opinion, chargeable with duty but which appears to be not duly stamped9. As a consequence of insufficient stamping, an instrument becomes inadmissible in evidence for any purpose and it cannot be acted upon, registered, or authenticated10. Once the payment of stamp duty and penalty, if any, is complete, an instrument becomes admissible in evidence11.

On the contrary, the understanding put forth in N. N. Global 2 was that an agreement, not duly stamped, is unenforceable until the payment of appropriate stamp duty. Consequently, such an instrument would be void as long as it remains unenforceable.

Disagreeing with such interpretation, the Apex Court in the Curative Petition observed that the admissibility of an instrument in evidence is distinct from its validity or enforceability in law. Non-stamping or improper stamping renders an instrument inadmissible in evidence and not void. Upon payment of proper stamp duty and penalty in the manner prescribed by the Stamp Act, an instrument shall become admissible in evidence. Inadmissibility is a curable defect, however, there is not procedure in law to cure voidness.

2. Principles of Arbitral Autonomy and Minimal Judicial Intervention

The principles of arbitral autonomy and minimal judicial interference lies at the heart of arbitral jurisprudence. Arbitral autonomy has two aspects, the first refers to the contractual freedom of the parties to bestow the arbitral tribunal with the authority to decide disputes that may arise between them. Additionally, the parties are free to agree on the procedure to be followed by the tribunal in conducting its proceedings12. The Second aspect refers to the autonomy conferred on the arbitral tribunal whereby it is not bound by the Code of Civil Procedure, 1908 or the Indian Evidence Act, 187213. Moreover, tribunals are empowered to conduct proceedings in any manner that it deems appropriate, if the parties fail to agree on the procedure to be followed by the tribunal14.

The principle of minimal judicial intervention, in aid, with the principal of arbitral autonomy demands that arbitral proceedings must be carried out by the tribunal without excessive judicial intervention. The Arbitration Act explicitly defines the extent of judicial intervention. It limits the supervisory role of the courts in arbitral proceedings to the extent expressly provided in Part I of the Arbitration Act15. Judicial intervention as governed by the Arbitration Act covers within its scope: (a) power to refer the parties to arbitration upon determination that prima facie a valid arbitration agreement exists16, (b) power to grant interim measures to the extent permissible under the Arbitration Act17, (c) power of the Supreme Court or the High Court appointment of arbitrators18, (d) power to assist an arbitral tribunal in taking evidence19 and (e) the power to set aside arbitral awards20. The Arbitration Act is a self-contained and exhaustive code on arbitration law, and as such it is imperative that the law must be followed in the manner indicated and as intended by the legislature and not otherwise.

3. Competence of the Arbitral Tribunal and Separability of the Arbitration Agreement

The doctrine of kompetenz-kompetenz21 dictates that an arbitral tribunal has the power to determine its own jurisdiction. The procedural and substantive concepts of the doctrine are enshrined in the Arbitration Act. The arbitral tribunal is expressly empowered to rule on its own jurisdiction, including objections regarding the existence or validity of the arbitration agreement22. The parties are of course at liberty to challenge the jurisdiction on grounds such as the non-existence or invalidity of the arbitration agreement. If such grounds are pleaded, the tribunal is well within its powers to decide on the challenge to its jurisdiction, and where it rejects such challenge, it can continue with the proceedings and render an award23.

The doctrine of kompetenz-kompetenz is complemented by the principle of separability. The law for the purpose of conferring jurisdiction upon an arbitral tribunal, mandates that an arbitration agreement which forms part of a contract shall be treated as an agreement independent of the other terms of the contract24. The principle of separability reflects the intention of the parties to distinguish the underlying contract, which captures the substantive rights and obligations of the parties, from an arbitration agreement, capturing the procedural framework for resolution of disputes arising out of the underlying contract. The principle of separability ensures that the invalidity or termination of the underlying contract does not affect the jurisdiction of the tribunal to decide any issue submitted to it for adjudication.

4. Harmonious Construction of Law

The Apex Court has harmoniously construed the Arbitration Act, Stamp Act and the Contract Act to uphold the primacy of the Arbitration Act over the other two legislations being a special law. The Arbitration Act is a special law for two reasons. Firstly, it is a self-contained and exhaustive code governing the law on arbitration, including arbitration agreements, as opposed to Stamp Act or Contract Act which deal with instruments or contracts in general. Secondly, the provisions of the Arbitration Act oust the jurisdiction of the courts. When a self-contained code sets out a procedure, the applicability of a general legal procedure would be impliedly excluded25.

The legislative intent of the Arbitration Act is to provide a one-stop forum for resolution of disputes between the parties without much judicial intervention. In the event of any dispute, the role of the courts is limited to referring the dispute to arbitration. The principle of separability allows the courts to appoint the arbitral tribunal without first determining the prima facie validity of the underlying contract. The mere appointment of an arbitral tribunal does not conclusively establish the enforceability of the agreement or the arbitration clause therein, these are matters for the tribunal to decide based on the provisions of the Indian Contract Act, 1872 ("Contract Act").

Once the arbitral tribunal is constituted, it is duly empowered to adjudicate the dispute between the parties. The legitimate concern of securing revenue is not defeated because the arbitral tribunal is vested with the power to assess the adequacy of stamp duty and to impound the agreement as per the Stamp Act, if deemed necessary.

Determination of such adequacy of stamp duty requires a detailed consideration of evidence and submissions and a finding as to the law as well as the facts. Mandating the courts to delve into such issues would contradict the legislative intent of expeditious resolution of disputes under the Arbitration Act.


The Supreme Court has through the above set of principles and detailed rationale reaffirmed the broader legislative intent of promoting arbitration as a preferred mode of dispute resolution. From a transaction standpoint as well, it reaffirms the mandate of the Stamp Act, that is, any instrument comprising or relating to several distinct matters shall be chargeable with the aggregate amount of the duties with which separate instruments are chargeable26. An agreement containing arbitration clause, shall be subject to an aggregate amount of duty. In practice, however, it is seen that stamp duty is paid only on the general agreement and not on the arbitration agreement which forms a distinct matter. The Curative Petition has brought about a fortunate moment and such deficiency cannot render the agreement void; the defect is curable at the instance of payment of appropriate duty to make good the revenue loss by State. It is at the same time crucial to preserve the rights bestowed through contract and uphold the objectives therein than render them void for want of procedure.


1. Rupa Ashok Hurra v. Ashok Hurra and Another (2002) 4 SCC 388

2. Jang Singh v. Brijlal & Ors. AIR 1966 SC 1631

3. 2023 INSC 1066

4. (2021) 4 SCC 379

5. Vidya Drolia v. Durga Trading Corporation (2021) 2 SCC 1

6. (2023) 7 SCC 1

7. Originated in France and recognized by the US Supreme Court in Prima Paint Corp. v. Flood & Conklin Mfg. Co. (1967). The first legislation in which the doctrine of separability was enacted was the English Arbitration Act, 1689. Article 16 of the UNICTRAL Model Law encapsulates the doctrine of separability based on which the Indian Arbitration and Conciliation Act, 1996 was enacted. The doctrine of separability is minutely distinct from the doctrine of severability as stated in the Constitution of India. Doctrine of separability was conceived to resolve the issue of validity of laws which are held as unconstitutional. It ensures the survival of provisions of the statute that are not void.

8. Arbitration And Conciliation Act, 1996, Section 16(1)

9. Indian Stamp Act, 1899, Section 33

10. Indian Stamp Act, 1899, Section 35

11. Indian Stamp Act, 1899, Section 42

12. Arbitration And Conciliation Act, 1996, Section 19(1)

13. Arbitration And Conciliation Act, 1996, Section 19

14. Arbitration And Conciliation Act, 1996, Section 19(3)

15. Arbitration And Conciliation Act, 1996, Section 5

16. Arbitration And Conciliation Act, 1996, Section 8

17. Arbitration And Conciliation Act, 1996, Section 9

18. Arbitration And Conciliation Act, 1996, Section 11

19. Arbitration And Conciliation Act, 1996, Section 27

20. Arbitration And Conciliation Act, 1996, Section 34

21. Also known as doctrine of competence- competence and implies that arbitral tribunal is empowered and is competent to rule on its own jurisdiction with no further review by the courts. However, in Indian jurisprudence, the doctrine has limited application as the award of the tribunal is subject to judicial review.

22. Arbitration And Conciliation Act, 1996, Section 16(1)

23. Arbitration And Conciliation Act, 1996, Section 16 (2) and (3)

24. Arbitration And Conciliation Act, 1996, Section 16 (1)(a)

25. Subal Paul v. Malina Paul, (2003) 10 SCC 361

26. Indian Stamp Act, 1899, Section 5

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.