Can a non-signatory or third party be party to arbitration without their prior consent?

A third party or a non-signatory could be subjected to arbitration without his prior consent only in exceptional cases.

The Hon’ble High Court of Delhi in the matter of RV Solutions Pvt. Ltd. vs. Ajay Kumar Dixit & Ors., CS(COMM) No. 745 of 2017, observed that the basic principle which must guide judicial decision making is that arbitration is essentially a voluntary assumption of an obligation by contracting parties to resolve their disputes through a private tribunal. The intent of the parties is expressed in the terms of their agreement. Where commercial entities and persons of business enter into such dealings, they do so with a knowledge of the efficacy of the arbitral process. The commercial understanding is reflected in the terms of the agreement between the parties. The duty of the court is to impart to that commercial understanding a sense of business efficacy.

The Court considered the decision held by the Supreme Court in Cheran Properties Limited vs. Kasturi & Sons Limited and Ors., the existence of a relationship between the parties, commonality of the subject matter and whether the agreement between the parties is a part of a composite transaction have to be seen. A third party or a non-signatory could be subjected to arbitration without his prior consent, though this would only be in exceptional cases. This would happen only when there is a direct relationship to the party signatory to the arbitration agreement, commonality of the subject matter and the agreement between the parties being a composite transaction.