The SC in its decision dated October 3, 2018 in Larsen and Toubro Limited v. Mumbai Metropolitan Region Development Authority[1] addressed the issue of: (i) whether a consortium formed between an Indian company (i.e. L&T) and a foreign company (i.e. Scomi Engineering BHD) is a ‘body corporate’ or an ‘association’; and (ii) whether an arbitration proceeding in which such consortium is a party, would be considered to be an International Commercial Arbitration[2] under the A&C Act. The SC held that it was not open for L&T and Scomi to act as independent entities while dealing with Mumbai Metropolitan Region Development Authority as they will have to deal with the MMRDA only as a consortium only and not as two separate entities. Thus, it was held that the consortium formed by L&T and Scomi falls within the meaning of an association under Section 2(1)(f)(iii) of the A&C Act. The SC further held that since the lead member of the consortium was L&T, a company incorporated in India, and the consortium’s office was in Mumbai, the central management and control of the consortium was in India and, therefore, the matter did not qualify as an international commercial arbitration under the A&C Act.

[1] Arbitration Petition (C) No. 28 OF 2017. [2] An ‘international commercial arbitration’ is defined at Section 2(1)(f) of the A&C Act as an arbitration relating to disputes arising out of legal relationships, whether contractual or not, considered as commercial under the law in force in India and where at least one of the parties is—(i) An individual who is a national of, or habitually resident in, any country other than India; or (ii) A body corporate which is incorporated in any country other than India; (iii) A company or an association or a body of individuals whose central management and control is exercised in any country other than India; (iv) the Government of a foreign country.