Section 8 arbitration reference is unavailable for only part of a suit when non-arbitrable claims or non-signatories are included.

Section 8 of the Arbitration and Conciliation Act, 1996 applies only when the judicial proceeding concerns a matter covered by an arbitration agreement and the reference application is made in time and in the prescribed manner. The provision does not permit bifurcation of the suit, separation of parties, or referral of only the arbitrable portion to arbitration. Where the suit includes non-arbitrable reliefs or parties not bound by the arbitration clause, the matter is not wholly covered by section 8 and reference cannot be ordered in part. Section 89 of the Code of Civil Procedure cannot be used to expand section 8 or create a partial-reference procedure not provided by the Act.

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Issues: Whether, under section 8 of the Arbitration and Conciliation Act, 1996, a civil court must refer the entire suit to arbitration when the suit includes claims beyond the arbitration agreement and parties who are not bound by the arbitration clause, or whether the court can split the cause of action and refer only the arbitrable part.

Analysis: Section 8 operates only where the action before the judicial authority is in respect of a matter which is the subject of an arbitration agreement and a timely application is made in the prescribed manner. The provision contains no mechanism for splitting the subject-matter of a suit, separating parties, or referring only part of the dispute to arbitration. Unlike section 24 of the Arbitration Act, 1940, the 1996 Act does not authorise bifurcation of the cause or partial reference. Where the suit contains non-arbitrable reliefs or includes parties who are not parties to the arbitration agreement, the entire matter does not fall within section 8. Section 89 of the Code of Civil Procedure, 1908 cannot be used to rewrite the scope of section 8 or to create a procedure not contemplated by the Act.

Conclusion: The court is not required to refer a suit in part to arbitration under section 8, and where the suit is not wholly covered by the arbitration agreement, the request for reference fails.

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