Arbitration clause barred writ review of GST liability under a lease agreement, leaving the dispute for the arbitral forum.

A writ petition seeking refund of GST and allocation of GST liability under a lease agreement was not entertainable because the agreement contained an arbitration clause covering all disputes arising out of or in connection with it. The HC declined to interpret the tax-payment clauses in writ jurisdiction, including the clause said to cover new tax introductions, and left those contractual questions to the agreed arbitral forum. The parties were therefore relegated to arbitration, and the petitioner did not succeed.

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Issues: Whether the writ petition seeking refund of GST and allocation of GST liability under the lease agreement was maintainable in view of the arbitration clause, and whether the parties were required to be relegated to arbitration.

Analysis: The dispute arose from the lease agreement between the parties and centred on the interpretation of the tax-payment clauses, especially whether the expression relating to new introductions included GST. The agreement contained a specific arbitration clause providing that all controversies, disputes and claims arising out of or in connection with the agreement were to be finally resolved by a sole arbitrator mutually nominated by the parties. In such a contractual setting, the writ court declined to enter into the interpretation of the contractual clauses so as not to prejudice either party before the arbitral forum. The dispute was held to be one that could be resolved under the agreed arbitral mechanism rather than in writ jurisdiction.

Conclusion: The writ petition was not entertainable and the parties were relegated to arbitration; the petitioner did not succeed.

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