Analyzing Rajia Begum v. Barnali Mukherjee: The Supreme Court on Forged Arbitration Agreements
In March 2026, the Supreme Court of India drew a line that every arbitration practitioner must understand. In Rajia Begum v. Barnali Mukherjee & Ors. (2026 INSC 106), The Court ruled that when a party alleges the arbitration agreement itself is forged, not merely that a fraud occurred within the underlying contract that no arbitrator can be appointed and no reference can be made. The matter must first be adjudicated by a court of law.
The ruling is significant not because it breaks new ground in doctrine, but because it catches a fault line that Indian courts have repeatedly tripped over: the difference between fraud in a contract and fraud of the arbitration agreement. Getting that distinction wrong means arbitrating a dispute that was never consensually submitted to arbitration in the first place. It is a jurisdictional error, and this judgment corrects it at the highest level.
For institutions and practitioners who work with dispute resolution infrastructure, the implications are direct. The arbitration agreement is not simply a clause it is the source of the arbitrator's power. Where that source is tainted, everything downstream collapses.
THE DOCTRINAL FOUNDATION: CONSENT AS JURISDICTION
Arbitration is, at its core, a creature of consent. This is not a philosophical observation, it has hard legal consequences. An arbitral tribunal draws its jurisdiction exclusively from the agreement of the parties. Where no valid agreement exists, the tribunal has no authority to decide anything, including its own authority.
This is the separability doctrine's other face. The principle that an arbitration clause survives the invalidity of the main contract is well-established. But separability has limits. It protects the arbitration clause from defects in the surrounding contract; it does not insulate the arbitration clause from defects within itself. When a party alleges that the very document containing the arbitration clause was fabricated, separability offers no refuge. There is no valid agreement to separate.
The Supreme Court in Rajia Begum gave this principle its clearest articulation in the context of Indian law. A forged arbitration agreement does not merely raise a procedural objection—it strikes at the jurisdictional root. Courts, not arbitrators, must resolve it.
The dispute centred on a partnership firm, M/s RDDHI Gold, originally constituted on December 1, 2005, by three partners: Barnali Mukherjee, Aftabuddin, and Raihan Ikbal.
Years later, one Rajia Begum claimed that in April 2007, two of the original partners executed a power of attorney in her favour, pursuant to which she entered into a deed of admission and retirement. The "Admission Deed" by which the original partners retired and she was inducted as a 50.33% partner. Crucially, the Admission Deed contained an arbitration clause.
Barnali Mukherjee denied all of this entirely. Her position was that no such deed was ever executed, that the document was a fabrication, and that the partnership's business had in any case been absorbed into a private limited company in 2011. The controversy was compounded by a telling circumstance: despite allegedly acquiring a majority stake in 2007, Rajia Begum first relied on the Admission Deed in October 2016 nearly nine years after its supposed execution, when she issued a legal notice claiming partnership rights.
Three separate proceedings followed, each arriving at a different court, each producing a contradictory outcome.
THE PROCEEDINGS: A STUDY IN JUDICIAL INCONSISTENCY
Section 9 Pre-Arbitration Interim Relief
Rajia Begum's first move was to approach the Trial Court under Section 9 seeking interim protection, including the appointment of a receiver. The Trial Court allowed the application. On appeal, however, the High Court reversed this in May 2018, holding that Rajia Begum had failed to demonstrate even a prima facie case that a valid arbitration agreement existed. The Court was not satisfied that the Admission Deed was genuine. An SLP against this finding was dismissed by the Supreme Court, meaning the High Court's doubt about the document's authenticity attained finality.
Section 8 Reference of Civil Suit to Arbitration
In a parallel track, Barnali Mukherjee filed a civil suit seeking a declaration that the Admission Deed was forged and void. Rajia Begum responded by filing an application under Section 8, asking the civil court to refer the suit to arbitration on the basis of the arbitration clause in that very deed.
The Trial Court refused the reference. It found that the allegations of fraud were serious and complex, and that Rajia Begum had not produced the original Admission Deed or a certified copy as required under Section 8(2). The First Appellate Court agreed. The High Court, exercising supervisory jurisdiction under Article 227 of the Constitution, disagreed—and ordered the reference.
Section 11 Appointment of Arbitrator
Simultaneously, Rajia Begum filed a petition under Section 11 seeking the appointment of an arbitrator. The High Court dismissed this petition, holding that until the very existence of the arbitration agreement was finally decided, any appointment would be premature.
The result was a glaring contradiction: the same High Court, confronted with the same facts, referred the dispute to arbitration under Section 8 while refusing to appoint an arbitrator under Section 11. The Supreme Court was required to resolve this inconsistency.
The Court framed the question with precision: where a party contends that the document containing the arbitration clause is itself forged and never executed, can a court refer the dispute to arbitration under Section 8, or appoint an arbitrator under Section 11?
This required the Court to navigate two competing currents in Indian arbitration jurisprudence- the doctrine of minimal judicial intervention and the foundational requirement of a valid, consensually entered arbitration agreement.
ANALYSIS: SECTION 8 AND SECTION 11 UNDER THE FRAUD LENS
The General Rule on Fraud and Arbitrability
Indian courts have consistently held, following A. Ayyasamy v. A. Paramasivam (2016) and refined in Vidya Drolia v. Durga Trading Corporation (2021), that mere allegations of fraud do not render a dispute non-arbitrable. Fraud that is internal to the contract disputes about misrepresentation, contractual deceit, fraudulent performance can be and routinely is decided by arbitral tribunals.
The threshold shifts, however, when the allegation is directed at the arbitration agreement itself. In Avitel Post Studioz Ltd. v. HSBC PI Holdings (Mauritius) Ltd. (2021), the Supreme Court held that where fraud permeates the entire contract or goes to the root of the arbitration clause, the jurisdictional question must be answered by a court. The test is not whether fraud is alleged, but where the fraud is alleged to operate.
The Specific Defect in This Case
In Rajia Begum, the allegation was not that the partnership firm was defrauded in some commercial transaction. The allegation was that the Admission Deed the very document said to contain the arbitration agreement was fabricated. There was no original on record. There was no contemporaneous acknowledgment of the deed's execution. For nine years, no one had acted on it. Banking records, firm documents, and the conduct of all parties during that period reflected the original partnership structure, not the alleged reconstitution.
Faced with this, the Court applied a straightforward but important principle: you cannot invoke an arbitration agreement to adjudicate a dispute about whether that same agreement exists. The consent upon which arbitral jurisdiction rests cannot be assumed into existence.
The High Court's Error Under Section 8
Section 8 of the Act mandates that a judicial authority, when seized of a dispute covered by an arbitration agreement, must refer the parties to arbitration unless it finds that the agreement is null and void, inoperative, or incapable of being performed. The key word is "finds." This requires the court to conduct at least a prima facie examination of whether a valid agreement exists.
The High Court, exercising Article 227 jurisdiction, re-appreciated evidence and reversed two concurrent fact-finding decisions. The Supreme Court held this was an impermissible exercise of supervisory power. Article 227 does not permit a High Court to substitute its own conclusions for those of lower courts merely because a different reading is possible. Supervisory jurisdiction is corrective, not appellate.
More fundamentally, by ordering the reference despite the absence of the original document and the grave questions hanging over the deed's authenticity, the High Court bypassed the gatekeeping function that Section 8 imposes on courts before they surrender jurisdiction to an arbitral tribunal.
The High Court's decision under Section 11 was, paradoxically, the correct one though it stood in direct contradiction with its Section 8 order. Section 11(6A), as interpreted through Duro Felguera and subsequent cases, requires courts to confine their examination at the appointment stage to whether an arbitration agreement exists. Where that examination raises serious doubt, appointment must wait.
This is not a technicality. An arbitrator appointed under a disputed agreement inherits that dispute. Any award rendered would face immediate challenge on jurisdictional grounds under Section 34. The prudent course and the one the Supreme Court endorsed is to resolve the foundational question first.
The combined effect of the ruling on both sections is a coherent position: courts must not export jurisdictional questions to arbitrators. Where the existence of the agreement is genuinely contested on serious material, courts must decide it themselves.
THE EVIDENTIARY DIMENSION
What distinguishes this case from a routine fraud allegation is the quality of the evidentiary doubt. The Supreme Court pointed to five convergent circumstances: the nine-year delay before the deed was relied upon; the absence of the original document; the husband's admitted continued participation as a partner until 2010, three years after the alleged retirement; the consistent exclusion of Rajia Begum from all banking and firm records; and the finality achieved by the High Court's 2018 Section 9 order doubting the document's authenticity.
Each circumstance, standing alone, might not defeat a prima facie case. Together, they formed a picture that made a prima facie finding in favour of the agreement's existence impossible to sustain. This is the standard courts must apply at the referral stage: not proof beyond doubt, but a genuine prima facie satisfaction that an agreement exists.
Rajia Begum v. Barnali Mukherjee is a judgment about the floor, not the ceiling, of judicial intervention in arbitration. It does not encourage courts to look for reasons to refuse reference. What it does is insist that courts not be complicit in bootstrapping jurisdiction for arbitral tribunals that have none.
The ruling holds that the gatekeeping role of courts under Section 8 and Section 11 is not a formality. It is a substantive inquiry, however brief, into whether the source of arbitral jurisdiction the agreement itself actually exists. Where that inquiry raises serious questions that two concurrent fact-finding courts have already answered in the negative, a supervisory court cannot simply bypass them in the name of pro-arbitration policy.
This judgment resolves a confusion that, frankly, should not have required Supreme Court intervention. The principle that a forged agreement cannot ground arbitral jurisdiction is not novel. What the High Court got wrong was the assumption that pro-arbitration policy is a mandate to refer disputes to arbitration regardless of whether the arbitration agreement is valid. It is not.
Pro-arbitration policy means respecting arbitration where the parties have genuinely chosen it. It says nothing about forcing parties into a process they never agreed to and indeed, it says quite the opposite.
For dispute resolution practitioners, the lesson is both procedural and commercial. In any case where the authenticity of the document containing the arbitration clause is in dispute, the threshold question must be resolved before any reference is made or arbitrator appointed. Skipping that step does not save time it defers the same question to a more expensive and disruptive setting: a challenge under Section 34.
There is also a structural implication for ODR infrastructure. Platforms like adrEdge operate on the premise that parties have agreed to resolve disputes through a particular mechanism. The integrity of that premise the existence of genuine, verifiable consent is what makes digital dispute resolution enforceable. Rajia Begum is, at bottom, a reminder that the value of any dispute resolution system begins with the validity of the agreement that invokes it.
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