The Delhi High Court recently made a ruling stating that a non-signatory or third party to an agreement can be subjected to arbitration without their prior consent, but only in exceptional cases.

The court emphasized that these exceptions should be examined based on various factors, including a direct relationship to the parties involved in the arbitration agreement, a direct commonality of subject matter, and the agreement between the parties being a composite transaction where the performance of the principal or mother agreement may not be feasible without the aid and performance of the supplementary or ancillary agreement.

The case before the court involved a petitioner seeking the appointment of an arbitrator based on a Master Service Agreement (MSA) executed between two respondents. However, the petitioner was not a signatory to the MSA. The petitioner argued that a Facility Agreement (FA) was executed between them and the first respondent, and therefore, the FA could not be separated from the MSA.

However, the court concluded that the petitioner could not invoke arbitration since they were not a party to the MSA.

The court noted that the MSA did not mention the petitioner, and the FA was an independent agreement between the first respondent and the petitioner. As a result, the court dismissed the petitioner's plea seeking the appointment of an arbitral tribunal to adjudicate the dispute.

Advocates representing both parties were present during the hearing of the case.

The petitioner was represented by Advocates Sonam Gupta, Devansh Arya, Saumay Kapoor, and Bahuli Sharma.

On the other hand, the respondents were represented by Advocates Amit George, Nitesh Mehra, Amol Acharya, Anumeha Singhai, Rayadurgam, Hitakshi Mehra, Ekta Rai, and Aadil Khan.