ArcelorMittal Nippon Steel & IOCL to Appoint Arbitrators in Essar Case, SC Gives Its Nod

The Supreme Court has granted for the initiation of arbitration proceedings by ArcelorMittal Nippon Steel India Limited and Indian Oil. Reports ETV Bharat's Sumit Saxena.

New Delhi:The Supreme Court on Monday paved the way for the initiation of arbitration proceedings by ArcelorMittal Nippon Steel India Limited (AMNSIL) and Indian Oil Corporation Ltd (IOCL), in connection with the resolution of their dispute relating to Essar Steel India Limited (ESIL).

A three-judge bench led by Chief Justice of India D Y Chandrachud considered the joint agreement of IOCL and AMNSIL regarding appointment of an arbitrator each within a week.

The apex court said that both sides would have the liberty to argue on the aspect of whether the dispute was arbitrable or not.

The bench, also comprising justices JB Pardiwala and Manoj Misra, said the parties have agreed to nominate two arbitrators within a week. “The two arbitrators so appointed will nominate the third arbitrator. In view of the agreement of the parties, the Delhi high court’s judgment dated October 10, 2023, is rendered infructuous”, said the bench. The apex court said that all rights and contentions of the parties are kept open.

Senior advocates Harish Salve and Abhishek Manu Singhvi represented AMNSIL in the matter and Solicitor General Tushar Mehta, represented IOCL.

In 2019, ESIL was acquired by AMNSIL through the corporate insolvency resolution process.

The high court had dismissed IOCL’s plea to appoint an arbitrator to adjudicate a dispute that emanated from a gas supply agreement (GSA) that it entered with ESIL in 2009. The National Company Law Tribunal, in August 2017, in Ahmedabad admitted ESIL into insolvency proceedings and appointed a resolution professional.

A claim of over Rs 3500 was claimed by IOC before the RP. However, the claim was admitted for a notional value of ₹1.

In 2019, the apex court approved ArcelorMittal’s resolution plan, which included this notional value. The resolution plan was implemented and AMNSIL took over the company. In 2022, IOC moved Delhi High Court for the appointment of an arbitrator to adjudicate its dispute.

Read More