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The present controversy arose because the Arbitration and Conciliation Act, 1996, does not expressly empower courts to modify or vary an arbitral award, and Section 34 of the 1996 Act only confers upon courts the power to set aside an award.
by Aashish Gupta*, Puneeth Ganapathy** and Rishab Aggarwal***
Section 34 of the Arbitration and Conciliation Act, 1996 provides the legal framework for challenging an arbitral award before a court, while Section 37 governs appeals against specific orders passed under the Act, including those made under Section 34.
“It is now trite law that State agencies cannot hide behind the conventional excuse of bureaucratic delays and inefficiency in the State’s capacity, to condone delays.”
The Court had ordered the attachment of the Bikaner House to enforce payment since neither did the Nagar Palika of the State of Rajasthan comply with the court order to file an affidavit of assets nor did it pay the petitioner per the arbitral award.
The Nagar Palika of the State of Rajasthan failed to comply with court order to file an affidavit of assets despite being given multiple opportunities and failed to pay the petitioner in accordance with the arbitral award.
This report covers the Supreme Court’s Never Reported Judgment, on common intention, dating back to the year 1953.
The Court held that the benefit of reasonable doubt shall be given to the appellants and therefore partly allowed both the appeals, by acquitting them under Section 302 of IPC, and releasing the incarcerated appellants sentenced under Section 307 of IPC, for having served the ordered sentence period.
“It is well settled principle that unilateral appointment of Arbitrator is not permissible under the law”
“The award is not required to be set aside until and unless it is vitiated by “patent illegality” appearing on the face of the record with a caveat that the award should not be set aside merely on the ground of erroneous application of law or by appreciation of evidence.”
“The expression ‘public policy’ is of wider amplitude and hence, where award passed by arbitral tribunal is against the terms of contract or against law of land for time being in force, such an award is against public policy of India and is liable to be set aside under Section 34 of Arbitration and Conciliation Act, 1996.”
“In the context of Section 14 of Limitation Act, 1963, what needs to be seen is whether appellant has brought on the record any evidence to show that he is prosecuting the previously instituted suit with due diligence.”
Calcutta High Court held Arbitrator’s refusal to decide question of interest under the MSMED Act constitutes a “decision” and therefore, can be challenged under Section 34 of the Arbitration and Conciliation Act, 1996.
Based on facts, the Supreme Court said that gunshots fired indiscriminately could be said to be a criminal act done by several persons in furtherance of the common intention of all.
“Arbitration is a private form of dispute resolution, however, the arbitral proceedings must meet the juristic requirements of due process and procedural fairness and reasonableness, to achieve a ‘judicially’ sound and objective outcome or award”.
This report covers the Supreme Court’s Never Reported Judgment dating back to the year 1952 on the credibility of injured eyewitnesses.
“It is essential that there be illegalities or deficiencies at the face of the Award which shocks the conscience of the Court for it to qualify to be set aside by an act of this Court while adjudicating upon a petition filed under Section 34 of the Arbitration and Conciliation Act, 1996.”
A party cannot simply raise an objection on the ground of patent illegality if the Award is against them. Patent illegality requires a distinct transgression of law, the clear lack of which makes the petition a pointless effort of objection towards an Award passed by a competent Arbitral Tribunal.
Section 34 of the Arbitration Act is a clear and unequivocal embodiment of the Legislature‘s intent to balance the competing facets of arbitration, I.e., on one hand, while courts are enjoined to follow the minimalist intervention route, it would clearly be a travesty of justice if they were to fail to intervene where circumstances warrant, and demand corrective measures being adopted.
The Supreme Court explained that the older Act enabled the Court to modify an award, a power which was consciously omitted by Parliament while enacting the 1996 Act, hinting towards exclusion of power to modify an award.