Consent order without merits finding cannot justify postponing a Section 8 arbitration objection; review recalled the deferral.

A review court held that a deferral of decision on a Section 8 Arbitration and Conciliation Act application could not stand where the earlier matter relied upon was decided by consent, not on merits, and had no binding effect on the present recovery suit. It found that the connected proceedings involved different grounds and a different cause profile, so the postponement reason was untenable. The earlier reasons were recalled, the review was allowed, and the defendant's arbitral-reference objection was restored for independent determination on its own merits in the suit.

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Issues: Whether the earlier order postponing decision on the defendant's application under Section 8 of the Arbitration and Conciliation Act, 1996 required review and recall on the ground that the earlier matter relied upon was not a binding merits decision and had no bearing on the present suit.

Analysis: The order sought to be reviewed had deferred consideration of the Section 8 application because of another pending matter. The review court found that the earlier matter was decided by consent and not on merits, and that the challenge in the connected proceedings arose on different grounds. It further held that the earlier case had no binding effect on the present dispute, which was a recovery claim and not a claim for specific performance. In these circumstances, the reasons recorded for postponing the Section 8 application could not stand, and the application had to be examined independently on its own merits.

Conclusion: The review was allowed, the reasons for postponement were recalled and reviewed, and the defendant's Section 8 application was directed to be decided on its own merits.

Final Conclusion: The earlier deferral order ceased to operate, and the arbitral-reference objection was restored for independent adjudication in the suit proceedings.

Ratio Decidendi: A prior order passed by consent and without a merits determination does not furnish a binding basis to defer decision on a pending application, and a review may be used to recall such a deferral when its premise is shown to be untenable.

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