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Issues: Whether the arbitration clause contained in the principal contract stood incorporated into the subcontract so as to enable appointment of an arbitrator under the Arbitration and Conciliation Act, 1996.
Analysis: Section 7(5) permits incorporation of an arbitration clause from another document only when the contract clearly refers to that document with the intention of making the arbitration clause part of the contract. A mere reference to another agreement, or to some of its conditions relating to execution, work, quality, or termination, does not by itself incorporate the arbitration clause. The reference must show a conscious acceptance of the arbitration clause, and a general reference to the main contract is insufficient. Applying that principle, the clauses in the subcontract were limited to work, quality, items, and termination-related terms and did not evince an intention to import the dispute resolution clause from the principal agreement. The subcontract contained no independent arbitration clause, and there was no separate arbitration agreement between the parties.
Conclusion: The arbitration clause from the principal contract was not incorporated into the subcontract, and the request for appointment of an arbitrator was not maintainable.
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