Supreme Court Clarifies Arbitrator's Power to Rule on Jurisdiction Despite 'Excepted Matters' Clause

Case Snapshot

• Case Name: M/s. GVV Constructions Private Limited v. Union of India & Ors.

• Citation: 2026 INSC 976

• Bench: Justice Pamidighantam Sri Narasimha and Justice Alok Aradhe

• Date of Judgment: September 8, 2026

• Area of Law: Arbitration Law, Judicial Review, Excepted Matters, Competence-Competence

The Judgment in One Line

Supreme Court clarifies that High Court's direction to arbitrator to decide claims "strictly in accordance with contract" cannot impinge on arbitrator's Section 16 jurisdiction.

Why This Judgment Matters

This judgment reinforces the kompetenz-kompetenz principle under Section 16 of the Arbitration Act. It clarifies that even where a contract contains an "excepted matters" clause excluding certain disputes from arbitration, the Arbitral Tribunal, not a writ court, must first decide whether the dispute falls within that exclusion. The ruling protects the arbitral process from judicial encroachment at the referral or writ stage, consistent with the post-2015 framework that limits judicial scrutiny to the existence of the arbitration agreement.

Background

GVV Constructions was awarded a railway track doubling contract, with completion due October 2018. The contract was terminated on June 10, 2022, under Clause 62 of the Standard General Conditions of Contract (GCC), and the performance guarantee was forfeited. The contractor sought quashing of the termination order in a writ petition. The Single Judge dismissed the petition, holding the termination valid and noting the contractor had already invoked arbitration.

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