Supreme court rules on matters pertaining to agreement

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In a key judgment in Velugubanti Hari Babu v Parvathini Narasimha Rao & Anr, the Supreme Court has held that where in proceedings before the high court under section 11 of the Arbitration and Conciliation Act, 1996, questions arise as to the validity, genuineness and enforceability of the agreement or memorandum of understanding (MoU), it is the high court’s duty to decide such questions and they cannot be referred to the arbitrator.

Disputes between the parties arose during a project involving joint development of land. Rao petitioned for the appointment of an arbitrator on the basis of an MoU. Babu contended that the MoU was fabricated and his signature was forged.

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