18 December 2025 Legal Updates

ISSUES ABOUT PARTY'S CAPACITY TO INVOKE ARBITRATION AND MAINTAINABILITY ISSUES FALL WITHIN TRIBUNAL'S DOMAIN: SUPREME COURT

(a) Case Title:

• M/s Andhra Pradesh Power Generation Corporation Limited (APGENCO) vs. M/s Tecpro Systems Limited & Ors.

(b) Court: 

• Supreme Court of India

(c) Date of Decision:

• 17 December 2025

(d) Bench: 

• Justice Pamidighantam Sri Narasimha & Justice Atul S. Chandurkar

Background

The case involved a dispute between APGENCO (appellant) and a Consortium comprising three companies: Tecpro Systems Ltd. (lead member), VA Tech Wabag Ltd., and Gammon India Ltd. The Consortium was awarded an EPC contract for a thermal power plant. During execution, Tecpro faced financial distress, was replaced as lead member, and later went into insolvency. Tecpro invoked arbitration individually against APGENCO for alleged dues. APGENCO objected, arguing that only the Consortium as a whole could invoke arbitration.

Key Legal Issue

Whether an individual member of a consortium can unilaterally invoke arbitration under an arbitration clause that is between the employer and the Consortium.

Arguments

• APGENCO: Argued that the arbitration agreement was only with the Consortium, not individual members.
• TECPRO: Contended that the arbitration clause was incorporated into the Purchase Orders, and as a member with separate contractual obligations, it had the right to invoke arbitration.

Court’s Analysis & Decision

• Limited Role of Referral Court (Section 11): The Supreme Court emphasized that under Section 11(6A) of the Arbitration Act, the court’s role is confined to a prima facie examination of the existence of an arbitration agreement. It should not delve into merits, capacity, or maintainability at the referral stage.
• Prima Facie Existence Found: The Court held that there was a prima facie arbitration agreement between the parties, as the GCC containing the arbitration clause was incorporated into the Purchase Orders.
• Detailed Issues Left to Arbitral Tribunal (Section 16): Questions such as whether Tecpro could individually invoke arbitration, the status of the Consortium, and the necessity of consent from other members are to be decided by the Arbitral Tribunal under Section 16, which grants it kompetenz-kompetenz (authority to rule on its own jurisdiction).

Final Ruling

The Supreme Court dismissed APGENCO’s appeals. The High Court’s order appointing an Arbitral Tribunal was upheld. All preliminary objections, including maintainability, are to be decided by the Arbitral Tribunal.

SEVERE DEMENTIA NOT ENOUGH TO STALL TRIAL UNLESS MEDICAL BOARD CERTIFIES: RAJASTHAN HIGH COURT DIRECTS RE-EVALUATION OF ACCUSED'S FITNESS

(a) Case Title:

• Sonu Ram Pachauri vs. State of Rajasthan & Anr.

(b) Court:

• High Court of Judicature for Rajasthan, Bench at Jaipur

(c) Date of Decision:

• 08th December 2025

(d) Bench:

• Justice Anoop Kumar Dhand

Background

The victim-petitioner challenged an order dated 05.12.2024 passed by the Additional Sessions Judge, Dholpur, which granted custody of the accused (Puran Singh) to his son on medical grounds. The accused was reported to be suffering from severe dementia with behavioural problems leading to severe cognitive impairment.

Issue

Whether the accused is mentally fit to stand trial, and whether the procedure under Section 329 CrPC was correctly followed.

Key Legal Provision

1. Section 329, CrPC – Deals with the procedure when an accused person is of unsound mind and incapable of making a defence.

2. The court must first determine the accused’s mental capacity, based on medical evidence from a Medical Board consisting of:

• Head of Psychiatry Unit (nearest government hospital)
• Faculty Member in Psychiatry (nearest medical college)

Observations of the Court

• The earlier Medical Board report only stated that the accused suffered from severe dementia and cognitive impairment, but did not explicitly state whether he was fit to understand or participate in trial proceedings.
• Without a clear opinion on the accused’s ability to comprehend the trial, the proceedings cannot proceed lawfully.

Court’s Directions

• A fresh Medical Board shall be constituted as per Section 329 CrPC.
• The Superintendent of S.M.S. Medical College, Jaipur, will form the Board.
• The Board must examine the accused and submit a report specifically stating whether the accused is mentally fit to understand and participate in court proceedings.
• The accused must appear before the Medical Board on 18.12.2025.
• Matter listed for next hearing on 05.01.2026.

Key Takeaway

The court ensures that an accused’s right to a fair trial is protected by mandating a detailed medical examination to ascertain their fitness to stand trial, in line with Section 329 CrPC.