Indus Powertech Inc v Echjay Industries Private Limited

DMC/Arbn/26/07

England

Indus Powertech Inc v Echjay Industries Private Limited

English High Court: Sean O’Sullivan KC (sitting as a Deputy High Court Judge): [2026] EWHC 827 (Comm): 10 April 2026

Judgment available on BAILII @ https://www.bailii.org/ew/cases/EWHC/Comm/2026/827.html

Ricky Diwan KC (instructed by Stewarts Law LLP) for the Appellant (Supplier)

Thomas Plewman KC and Chintan Chandrachud (instructed by Wilmer Cutler Pickering Hale and Dore LLP) for the Respondent (Manufacturer)

ARBITRATION: SECTION 68(2)(D) ARBITRATION ACT 1996 ‘SERIOUS IRREGULARITY’ CHALLENGE: DEFINITION OF “ISSUE”: WHETHER TRIBUNAL FAILED TO DEAL WITH ALL OF THE ISSUES PUT TO IT

Summary

This was a challenge by the Supplier against the Tribunal’s decision to award damages to the Manufacturer arising out of a contract for the exclusive supply of parts for the manufacture of cars in the North American market. The challenge was made on the basis of serious irregularity pursuant to section 68(2)(d) of the Arbitration Act 1996.

The Court upheld the Supplier’s challenge, holding that the Tribunal had failed to deal with two of the issues put to it. The Court accordingly remitted the case back to the Tribunal for further determination of those issues.

Case Note contributed by Andrea Skeoch, maritime arbitrator, co-editor of Lloyd's Maritime Law Newsletter and International Contributor to DMC's CaseNotes website

Background

The parties had entered into a supply contract and subsequent memorandum of understanding (together “the Contract”) whereby the Supplier (a supplier of car parts in North America) would source parts exclusively from the Manufacturer (a manufacturer of car parts in India).  In breach of the Contract, the Supplier had sourced parts from an alternative supplier, following which the Manufacturer terminated the Contract and claimed damages for loss of profits for the 7-year period during which it claimed that it would have supplied parts to the Supplier.

The Tribunal held that the Supplier was in breach and awarded the Manufacturer damages for loss of profits for a period of 2 years rather than the 7 years claimed.

The Supplier challenged the Tribunal’s decision on the basis of serious irregularity pursuant to section 68(2)(d) of the Arbitration Act 1996, arguing that there had been a failure by the Tribunal to deal with all of the issues put to it and, in particular, (a) whether the Manufacturer had any available manufacturing capacity to manufacture the parts and (b) whether any required design and production validation process required to manufacture the parts could have been completed within the 2-year period for which damages had been awarded.

Judgment

The Court held that, in determining a section 68(2)(d) challenge, it had to consider 4 questions:

(i)              whether the relevant point or argument was an “issue”;

(ii)             whether the issue was “put to” the tribunal;

(iii)            whether the  tribunal failed to deal with it; and

(iv)            if so, whether that failure had or would cause substantial injustice.

Questions (i) and (iii) were the primary questions in dispute.

The Court stated that an “issue” was a question which needed to be resolved before a tribunal could deal fairly with the claim, or which fairness demanded be dealt with and not overlooked.

Against a background of the need to maintain a high threshold for establishing serious irregularity, the Court stated that if the whole or a substantial part of the claim depended on the answer to a question, it was likely to be an issue, and the fact that a question could be characterised as a sub-issue to a wider issue did not prevent section 68(2)(d) from being engaged.

When deciding whether a tribunal can be said to have failed to deal with an issue, its award must be read in a fair, commercial and commonsense way. A court should not be hypercritical in determining whether the issue has been dealt with. The focus of section 68 is whether there has been due process, not whether the tribunal’s decision was correct. If a tribunal has dealt with the issue in any way (no matter how well, badly or indifferently), that is the end of the matter.

When deciding whether there has been a failure to deal with an issue, the Court stated that the award should not be interpreted in a vacuum. Rather, one must take account of the way in which issues were presented in the parties’ submissions and appreciate that a failure to give reasons was not the same as a failure to deal with an issue. By the same token, it must be made apparent to the parties that the issue had been determined. If an issue would impact a tribunal’s decision, one cannot simply infer that because of the relief granted, the tribunal must have preferred one party’s argument over the other. Something more is required before such an inference can be drawn.

On the facts, the Court held that the Manufacturer’s capacity to manufacture the parts had been put to the Tribunal, that the Tribunal had not dealt with it, and that this was a clear example of a situation where the potential prejudice was self-evident.

The Court also held that the issue as to how quickly the Manufacturer could manufacture the parts was likewise an issue which had been put to the Tribunal but that the Tribunal had failed to decide the issue as to whether 7 years or 2 years represented the lead time before the Manufacturer could have started to supply the parts. The test for substantial injustice had been met.

As a result, the Court upheld the Supplier’s challenge and remitted the two issues back to the Tribunal for determination.

Comment

The threshold for satisfying the requirements of a section 68(2)(d) challenge is notoriously high (as evidenced recently by the decision in The “Canary” (fn.1)). However, the current case is a rare example of one in which the requisite threshold was met and the challenge successful.

The judgment contains a useful summary of the case law as to the four constituent ingredients to a successful s68(2)(d) challenge, with particular emphasis on the definition of an “issue” and the test for determining whether a tribunal had failed to deal with the said issue.

It provides useful guidance for both the parties to arbitration when considering a post-award section 68 challenge and for tribunals when drafting and issuing their awards, in particular the need for clarity within the award that an issue before the tribunal has been dealt with.

Footnote 1: Eagle Bulk Pte Ltd (now Star Bulk (Singapore) Pte Ltd) v Traxys North America LLC [2026] EWHC 518 (Comm) – see DMC case note here