The arbitrability of civil fraud in India: analysing the Supreme Court of India's decision in Avitel Post Studioz Ltd

摘要

The arbitrability of civil fraud under Indian jurisprudence had been a victim of vaguely worded and scattered tests for a considerable period of time. In its recent decision in Avitel Post Studioz Ltd v HSBC PI Holdings (Mauritius) Ltd., the Supreme Court of India finally put the uncertainties regarding the matter to rest by harmonizing the existing law on it and crystallizing the 'public flavour' standard. According to this standard, allegations of fraud which find their roots in civil law and have no public considerations shall now be considered arbitrable in India. The judgment also clarified the impact that parallel criminal proceedings based on the same set of facts would have on the arbitrability of the civil aspects of such fraud, bringing necessary clarity to the erstwhile regime. In this article, we explore the implications of this judgment in detail, highlighting its relevance for arbitration in India, and how it impacts the jurisprudential position on the arbitrability of fraud in the country.