Arbitration and Conciliation Act, 1996—Section 31(7)—Award of Interest by Arbitral Tribunal—Where the arbitral tribunal awarded interest at 12% per annum from the date the statement of claim was affirmed, the Supreme Court upheld the award, holding that such pendente lite interest is permissible unless expressly or impliedly barred by the agreement—Clause 18.1 of the contract stated that no interest would be payable on delayed payments or disputed claims, but did not oust the tribunal’s power to grant pendente lite interest—The Court reiterated that arbitral power to award interest during pre-reference and pendente lite periods is subject to the contract, while post-award interest is governed statutorily—A clause barring interest on delayed payment alone does not imply a bar on pendente lite inter...

A. Arbitration and Conciliation Act, 1996—Section 9—Interim Relief—Estoppel by Conduct—A party that voluntarily consented to an arbitral award, which subsequently formed the basis of a compromise decree, is barred from later contesting the validity or enforceability of that award—Once the opposing party has relied upon the award and altered its position accordingly, the principle of estoppel prevents the consenting party from taking an inconsistent stand. (Paras 13, 14, 18, 19) B. Civil Procedure Code, 1908—Section 92—Jurisdiction and Non-Arbitrability—Estoppel—Where a party initially accepted the maintainability of a civil suit and invoked arbitration, it cannot later challenge the arbitrability of the dispute under Section 92 of the CPC—Such conduct amounts to estoppel ...

(A) Arbitrator's Power to Grant Pendente Lite Interest—The court held that Clause 22 of the contract, which prohibits the contractor from claiming interest on payments, arrears, or balances due, does not expressly prevent the arbitrator from awarding pendente lite interest in cases of disputes or delays—The court emphasized that a clear and express bar is necessary to restrict the arbitrator's jurisdiction—Therefore, unless explicitly stated, the arbitrator retains the authority to grant pendente lite interest, ensuring fairness in the resolution of disputes during the arbitration process. (Paras 3, 10, 15) (B) Arbitration Act, 1940 and Arbitration and Conciliation Act, 1996, Section 31(7)(a)—Difference in Interpretation of Contractual Clauses Barring Interest—Under the Arbitration Act of 1940...

Restoration of Arbitration Award. Arbitration and Conciliation Act, 1996, Section 37—Appeal by the Organization which gave Contract—To impugn order of Restoration of Arbitration Award—There is no palpable error in the arbitral award as to be termed 'patently illegal' / 'perverse', or in conflict with public policy of India—Therefore, the Division Bench of the High Court was justified in setting aside the judgment and order of the Single Judge and restoring the arbitral award. (Para 151) Result :- Appeal dismissed. ...

Power to do complete justice is exercised. Constitution of India, Article 142—Power to do complete justice—Appeal by contractor to impugn the judgement allowing Arbitration Appeal filed by Government before High Court, on wrong interpretation of law—The award is only in the sum of Rs. 6,52,235/- with interest. The award was made on 25th April 2014—Therefore, in the facts of the case, it will be unjust to set aside the award only on the ground of the failure of the appellant to take recourse to the 1983 Act—In fact, the appellant had taken recourse to the 1983 Act before seeking the appointment of an Arbitrator—In this case, as can be seen from the impugned judgment, the award has been set aside only on the ground that the appellant ought to have invoked the provisions of the 1983 Act—This is a ...

Govt Contracts. Arbitration and Conciliation Act, 1996, Sections 34, 37—Appeal by the Govt Contractor—To impugn judgement which set aside Award—And to restore Award—High Court had no reason to interfere with the Arbitral Award with respect to grant of pre-reference interest, since the Contract between parties does not prohibit the same—Award was partially restored. (Paras 9.6, 10) Result:- Appeal partly allowed. ...

Interest on Arbitration Award. Indian Arbitration Act, 1940, Sections 14, 17—Interest on Arbitration Award—A plain reading of the aforesaid award and decree reveals that interest awarded under the award has been dissected into two parts—The first part relates to the pre-award period from the date of the completion of the work till the passing of the award whereas the second part is the post-award period commencing from the date of the award till the satisfaction of the award—In the first part, simple interest @ 12% per annum has been awarded on the amount awarded whereas in the second part, interest @ 15% per annum has been awarded referring to the amount awarded—The amount awarded in both the situations have to be the same and cannot be two distinct amounts—The amount awarded refers to the principal a...

Arbitration Award Set Aside—Dispute Over Sale of Fertilizer Plant—Alleged Non-Compliance with Sale Conditions—High Court Finds Award Patently Illegal and Perverse—Non-Consideration of Vital Evidence—Dismantling of Plant Before Injunction—Principles of Patent Illegality and Perversity Applied—Award Set Aside, Costs Awarded to Appellant.   ...

Arbitration and Conciliation Act, 1996, Section 11(6)—Contract dispute—The contract involved construction work, and the petitioner claimed Rs.3,25,79,502 out of the total contract value of Rs. 4,30,95,325.However, the court noted that the dispute resolution clauses of the contract did not apply in this case—Despite the petitioner's claim being substantial, it did not meet the minimum threshold required for arbitration as per Clause 10.1 of the contract agreement—Therefore, the court dismissed the petition, stating that the dispute was not arbitrable according to the contract terms—The parties were advised to seek other legal remedies for resolving their dispute. (Para 9, 11, 12, 13 23 & 24) ...

Arbitration and Conciliation Act, 1996, Section 34(3)—Arbitration awards—The petitioner's arguments, purportedly based on public policy, are deemed unsustainable—The court finds no grounds to hold the impugned award contrary to Section 34(2) of the Act—The petitioner's arguments show disregard for the limited scope of intervention in international commercial arbitration awards and attempt to mislead the court—Hence, the petition is dismissed with costs of ₹50,000/- payable to the respondent within 4 weeks. (Para 20, 22 & 24) ...

Arbitration Act, 1940 - Sections 14 and 17—Arbitration and award—Disputes arising from an ancillary agreement between a government company and a private limited company—The agreement, executed in 1983, contained an arbitration clause—After disputes arose in 1991, the private limited company appointed an arbitrator, and the government company appointed another. An ex-parte award was made in 1992, followed by a court order in 2003 making the award a rule of court—The government company, unaware of these proceedings, sought to set aside the ex-parte order in 2004—The court rejected the application, prompting appeals—The High Court set aside the orders, emphasizing procedural irregularities, lack of notice, and failure to apply relevant rules—The matter was remitted to the lower court for fresh ...

Limitation Act, 1963—Article 119—Arbitration and Conciliation Act, 1996—Section 5, Section 12, Section 13, Section 16, Section 33, Section 34, Section 36, Section 37, Section 85, Section 85(2)(a)—Code of Civil Procedure, 1908 — Section 2(e), Section 2(2), Section 47—Arbitration Act, 1940—Section 3, Section 14, Section 28, Section 30—Additional award—Arbitration case—Dispute initially began under the Arbitration Act of 1940 but eventually continued under the Arbitration and Conciliation Act of 1996 due to an agreement clause—Petitioner argued that the new Act should not apply, and the additional award was without jurisdiction—Court found that the agreement clause allowed for the application of the new Act and that the objection to jurisdiction should have been raised e...

ARBITRATION AND CONCILIATION ACT, 1996—Section 34—Setting aside arbitral award—Awards which contain reasons, especially when they interpret contractual terms, ought not to be interfered with, lightly—An error in interpretation of a contract by Arbitrator is an error within his jurisdiction—Interfering with arbitral awards that provide reasons, particularly when interpreting contracts, should be done cautiously—An arbitrator's contract interpretation error is within their jurisdiction—A dissenting opinion is not treated as an award if the majority award is set aside but can offer insights on procedural issues—When challenging a majority award, the focus is on pointing out errors or illegalities. Parties, whether aggrieved or successful in a majority award, cannot challenge the soundness, ...

Indian Penal Code—Sections 403, 406, 420, 120-B—Issuance of process—Arbitration award—Allegations of Cheating and fraud—Trial Cout issued process against appellants—High Court affirmed the order of the trial court and confirmed issuance of process—along with the Inter Corporate Deposit Agreement complainant had pledged the shares in question—There was default of payment by complainant itself— As per the LoP itself, the accused could have sold the shares to themselves—Specific authority has been given by the Pledgee complainant to sell and dispose of the said securities under the circumstances mentioned in the LoP—Only allegation is that accused is that it had sold the shares to itself when the market price of the shares had fallen—Averments are totally contrary to the...

Arbitration and Conciliation Act 1996—Section 31(7)(a), 34 and 37—Arbitration award—Indian Railway Construction Company Limited (IRCON) appealed a judgment by the High Court of Delhi regarding a construction contract with M/s—National Buildings Construction Corporation Limited (NBCC)—The dispute involved the termination of the contract and the forfeiture of security deposits—The court found that the Arbitral Tribunal's decision to uphold IRCON's actions under Clause 17.4 of the contract was justified, and the security deposits should not be returned to NBCC—The court also upheld the award of interest on advance payments for equipment but reduced the interest rate from 18% to 12%. ...

Arbitration and Conciliation Act, 1996 - Sections 34 and 37 - Arbitration Appeal - Jurisdiction of High Court - Jurisdiction in a first appeal arising out of a decree in a civil suit is distinct from the jurisdiction of the High Court under Section 37 of the 1996 Act arising from the disposal of a petition challenging an arbitral award under Section 34 of the 1996 Act:- While considering a petition under Section 34 of the 1996 Act, it is well-settled that the court does not act as an appellate forum. The grounds on which interference with an arbitral award is contemplated are structured by the provisions of Section 34. The District Judge had correctly come to the conclusion that there was no warrant for interference with the arbitral award under Section 34. The High Court seems to have proceeded as if it was exercising jurisdiction in a r...

Arbitration and Conciliation Act, 1996—Section 34—Arbitral award—Rate of interest—Challenge to rate of interest awarded by High Court on awarded sum to respondent—High Court while dismissing appeal and in principle upholding of award of Arbitral Tribunal awarded interest at the rate of 12% p.a. and 18% p.a. in place of 10% and 12% p.a. which was awarded by Arbitral Tribunal—Impugned order modified to the extent that awarded amount shall carry interest at same rates which were awarded by Arbitral Tribunal in award. —  challenged the legality of the aforesaid award under Section 34 of the Arbitration and Conciliation Act, 1996 before the Additional District Judge, Faridabad, who by order dated 24.12.2010 partly allowed the application and modified the award accordingly....

Civil Procedure Code, 1908 (CPC)—Section 24, Section 34—Arbitration and Conciliation Act, 1996—Section 31(7)—Concerns the judgment of the Allahabad High Court on a matter arising from the arbitration award dated 13.4.1992. The appellant, a construction company, had a contract with North Eastern Railway for bridge construction—Disputes arose, leading to arbitration—The arbitrator awarded the appellant Rs. 4,48,873.22 with interest—The appellant moved to make the award a Rule of Court, and the respondent, North Eastern Railway, opposed it. The High Court held certain matters were non-arbitrable but allowed the award on other items—It barred interest payment based on contractual provisions—The court's conclusions on arbitrability, interest, and other issues led to partial allowance of...

Arbitration Act, 1940—Section 16, Section 17, Section 20,—Arbitration award—High Court set aside awards made by an arbitrator in favor of Rajendra Construction Company (RCC) against the Maharashtra Housing & Area Development Authority (MHADA)—The High Court claimed the awards were not "speaking" and lacked reasons—The Supreme Court, however, held that, under the Arbitration Act, 1940, an arbitrator was not obligated to provide reasons unless specified in the agreement—Referring to precedent, the court emphasized that private law disputes, such as those under arbitration, did not demand reasons akin to administrative law—The appeals were partly allowed, confirming the awards but reducing the interest rate from 18% to 10% per annum. ...

Arbitration and Conciliation Act, 1996—Section 21, Section 85, Section 85(2)—Consumer Protection Act, 1986—Section 22—Arbitration award—Jurisdiction—Supreme Court granted leave to consider the ramifications of an order dated 16.1.2003 in Civil Appeal No. 1920 of 1997—The said order arose from a complaint filed before the National Consumer Dispute Redressal Commission, which, upon agreement between the parties, referred the matter to arbitration—The Court, relying on Skypak Couriers Ltd. Vs. Tata Chemicals Ltd., allowed the appeal, setting aside the judgment and clarifying that the parties could enforce the arbitration award under the Arbitration and Conciliation Act, 1996—The present appeal challenges the execution of the award, asserting the applicability of the Arbitration Act, 1940,...

Civil Procedure Code, 1908 (CPC)—Section 34—Arbitration award set aside improperly: The case involved a tender for oxygen supply, leading to disputes on quality and non-payment—Arbitrator favored the appellant; however, a Single Judge, re-evaluating evidence, set aside the award—Misconduct allegations unfounded; Division Bench upheld the error—Court emphasized no appellate jurisdiction, barring misconduct—The Court reinstated the award, rebuking the reduction in interest rate during pre-reference, pendente lite, and post-award periods—The arbitrator's power to grant interest was affirmed, and Section 34 CPC inapplicable to arbitration—The decision underscores an arbitrator's authority and rejects interference unless misconduct or invalidity is proven, ensuring continuity and certaint...

Registration Act, 1908—Section 17, Section 17(1)—Civil Procedure Code, 1908 (CPC)—Section 115—Arbitration award—Case of distribution of assets of a dissolved firm among the partners themselves, the arbitration award, serving as a record of settlement, does not necessitate registration under Section 17 of the Registration Act—As a partnership firm lacks independent legal status, its assets are owned by the partners—On dissolution, the distribution of assets to individual partners reflects the legal consequence of the partners' pre-existing ownership shares—The award, whether documenting the settlement or achieved through mutual agreement, does not involve the transfer or assignment of ownership in any asset—Consequently, the award, delineating the distribution of assets after settli...

Arbitration Act, 1940—Section 14, Section 30—Calcutta High Court, which dismissed its appeal arising from an arbitration proceeding—The dispute arose from an agreement for construction work, which included an arbitration clause—After completion of the work, the respondent contractor accepted the final bill without objection but later raised additional claims, leading to the appointment of an arbitrator—The Union of India objected to certain claims during arbitration, including one related to the acceptance of the final bill without protest—The Supreme Court found that while the objection was not specifically raised in previous proceedings, the existence of a dispute is a condition precedent for arbitration—Therefore, the award regarding the disputed claim item was set aside, but other claims were ...

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Foreign Awards (Recognition and Enforcement) Act, 1961—Section 2, Section 7—Foreign Award Enforcement: Officer Arbitrator Not Contrary to Public Policy—An arbitration award from Ukraine, post-dissolution of the U.S.S.R., falls under the Foreign Awards (Recognition and Enforcement) Act, 1961—The Act's notification covers awards made in territories formerly part of the U.S.S.R., including Ukraine, under the New York Convention—Challenge to the award based on the arbitrator's status as a high-ranking officer of a party is dismissed—Appointment of such an officer does not inherently violate public policy, especially when parties consented to Ukrainian law governing arbitration—Parties frequently appoint officers as arbitrators, and it doesn't automatically render the arbitration or award c...

Arbitration Act, 1940—Section 14, Section 33—Specific Relief Act, 1963—Section 12, Section 20(1)—Around an arbitration award determining ownership of a property between two brothers, Kartar Lal and Sardar Singh—Sardar Singh claimed ownership of half the property, based on his contribution towards its purchase, despite the sale certificate being in Kartar Lal's name—The arbitration award declared Sardar Singh as the co-owner of the property—However, the lower courts ruled against Sardar Singh, stating that the award, being unregistered, could not affect the property's title—The dispute centered on whether the award required registration under Section 17(1)(b) of the Registration Act, which mandates registration for documents affecting immovable property over Rs. 100 in value—The...

Arbitration Act, 1940—Section 30—Minimum Wages Act, 1948—Section 5—Contests the High Court's ruling affirming the District Judge's decision to set aside an arbitration award related to a construction contract for the Bargi Masonry Dam—The dispute centered on the appellant's claim for reimbursement of increased wages, despite the absence of an explicit escalation clause in the contract—While the arbitrators initially ruled in favor of the appellant, their decision was challenged by the State on jurisdictional and quantification grounds—The District Judge invalidated the award, a decision upheld by the High Court due to the arbitrators' failure to address the State's liability and quantification issues adequately. ...

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Arbitration Act, 1940 - Section 30—Contractor was found to have misappropriated raw materials supplied by the Government— The arbitrator set off the cost of these materials against the damages awarded for breach of contract, ruling that the value of the unused steel was equal to the compensation due to the contractor— The arbitrator's decision to set off these amounts was based on his discretion and was not invalid— The arbitrator did not provide detailed reasons or legal principles for his decision, but the absence of such reasoning does not render the award invalid— The Court's interference is permissible only if the arbitrator's decision, when reasons are provided, is found to be contrary to law or erroneous on the face of the record— In this instance, the arbitrator's award, being ba...