Counterclaims in arbitration cannot be summarily rejected for lack of jurisdiction without examining arbitrability and contractual scope.

A respondent may raise counterclaims in arbitration unless the arbitration agreement confines the reference to specifically enumerated disputes. Whether a counterclaim arising from CENVAT invoices was within the contractual reference and arbitrable could not be conclusively decided without enquiry by the Arbitrator. Its presentation after commencement of arbitration did not, by itself, justify summary rejection for want of jurisdiction. The counterclaim could not be rejected at the threshold, and the Arbitrator was required to examine arbitrability and scope on merits after enquiry.

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Issues: Whether the counter claim relating to CENVAT invoices was beyond the scope of reference to arbitration and whether the Arbitrator could reject it at the threshold for want of jurisdiction.

Analysis: A respondent is entitled to raise counter claims unless the arbitration agreement restricts the reference to specifically enumerated disputes. The dispute whether the claim for CENVAT invoices arose from the contractual terms, whether it was arbitrable, and whether it fell outside the reference could not be conclusively decided without enquiry by the Arbitrator. The mere fact that the counter claim was raised after commencement of arbitration did not justify its summary rejection for want of jurisdiction at the threshold.

Conclusion: The counter claim could not be rejected at the threshold as beyond jurisdiction, and the Arbitrator was required to examine arbitrability and scope after enquiry.

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