Section 8 of The Arbitration Act VII

In view of the allegations of fraud levelled that the compromise decree is vitiated by fraud, the parties cannot be referred to Arbitration. Such a plea could be decided only by the Civil Court. Observing that where there are allegations of fraud which are so complicated that it becomes absolutely essential that such complex issues can be decided only by the Civil Court on apprehension of the evidence adduced by the parties, in A. Ayyasamy, (2016) 10 SCC 386 it was held as under:

It is only in those cases where the Court, while dealing with Section 8, finds that there are very serious allegations of fraud which make a virtual case of criminal offence or where allegations of fraud are so complicated that it becomes absolutely essential that such complex issues can be decided only by the Civil Court on the appreciation of the voluminous evidence that needs to be produced, the Court can.. dismiss the application under Section 8.

Hon’ble Justice R. Banumathi, Zenith Drugs and Allied Agencies Pvt. Ltd. v. Nicholas Piramal, [Civil Appeal No. 4430 of 2009].