12 May 2021 | Uttar Pradesh Power Transmission Corporation Ltd. and another v. CG Power and Industrial Solutions Limited and another | Special Leave Petition (C) No. 8630 of 2020 | Uday Umesh Lalit & Indira Banerjee JJ

A 2-judge bench of the Supreme Court has made several observations, in our view, obiter, on the power of the High Courts to consider a writ petition concerning a contract that has an arbitration clause.

The appellant directed the respondent to remit labour cess under a few construction contracts the latter had been awarded. The direction was challenged in a petition under Article 226 of the Constitution. The High Court allowed the petition.

In the course of the judgment, in paragraph 65, the Supreme Court referred to the arbitration clause on its own (“it is true that the General Conditions contain an Arbitration Clause which is set out hereinbelow”).

Then the court said that the existence of an arbitration clause does not debar the court from entertaining a writ petition. Also, it was settled that where the writ petition: seeks enforcement of a fundamental right, there is a failure of principles of natural justice, the impugned action is wholly without jurisdiction, or the vires of an Act is under challenge, availability of an alternative remedy is not a bar.

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