A. Arbitration and Conciliation Act, 1996—Section 31(7)(a) & (b)—Interest on Arbitral Awards—Party Autonomy—Where the contract between the parties expressly stipulates interest at a specified rate (21% p.a.) from the date of disbursement until repayment, the arbitral tribunal is bound to award interest in accordance with such terms—Tribunal's discretion under Section 31(7)(a) is overridden by the parties’ agreement—Further claim for compound interest or additional post-award interest under Section 31(7)(b) is impermissible once interest till repayment is already awarded—Neither the tribunal nor the court has authority to rewrite or expand the award beyond the contractual framework. (Paras 25.3, 28–31) B. Execution of Arbitral Award—Scope and Limits—No Modifi...

A. Civil Procedure Code, 1908 (CPC)—Section 47—Execution Proceedings—The executing court’s role is confined to enforcement and not to re-examination of arbitral awards—Grounds for challenging an arbitral award are exclusively governed by Section 34 of the Arbitration and Conciliation Act, 1996—Objections that could have been raised under Section 34 cannot be entertained during execution under Section 47 of the CPC—Attempting to challenge an award in execution proceedings frustrates the object and purpose of the Arbitration Act, which is a self-contained code. (Para ) B. Arbitration and Conciliation Act, 1996—Section 34—Challenge to Arbitral Award—Section 34 provides the sole remedy for setting aside an arbitral award—Failure to initiate challenge within the prescribed ti...

Civil Procedure Code, 1908—Section 151—The Superintending Engineer, Public Health, Nellore, issued a tender on 31.03.1987 for construction of a Summer Storage Tank—The contractor, successful in the bid, executed the work under an agreement dated 22.06.1987—Disputes arose leading to arbitration, wherein 14 claims were raised and four (Claims 2, 3, 4, and 9) were allowed—The arbitrator, an experienced engineer, awarded compensation for works alleged to have gone beyond the scope of the agreement, including additional conveyance of soil, use of a heavier roller for compaction, increased leads in bund formation, and idle charges due to delayed removal of electric towers—The trial court upheld the award, which was challenged by the employer on grounds that the arbitrator exceeded the terms of the agreement&m...

(A) Arbitration and Conciliation Act, 1996 Section 31(7)(a), 31(7)(b)—Discretionary Power of Arbitral Tribunal on Interest Awards—The Court clarified the arbitral tribunal’s statutory discretion to award interest on the sum determined in the award, covering the period between the cause of action and the award—The tribunal may divide this period into pre-reference and pendente lite periods, applying different interest rates for each, while excluding any delays caused by the claimant's laches—Additionally, post-award interest is applicable on the total amount, including both the principal sum and interest granted for the pre-reference and pendente lite periods, at the rate prescribed—This ruling ensures clarity on interest accrual in arbitral proceedings. (Paras 27 to 35, 39, 44) (B)...

Arbitration and Conciliation Act, 1996 – Sections 2(1)(h), 7, 16 & 19, 8, 11, 16 & 45—Power of Arbitral Tribunal to Implead Non-Signatories—Recognizes the evolving complexities of arbitration involving multiple parties—Though the Act does not expressly provide for the impleadment of non-signatories, judicial interpretation has clarified that Arbitral Tribunals possess such power under Sections 2(1)(h), 7, and 16, supported by procedural flexibility under Section 19—The power to implead arises when a non-signatory is shown to have consented—explicitly or impliedly—to the arbitration agreement, for instance, through their substantial involvement in contract negotiation or performance—Doctrines like "Group of Companies" or principles of implied consent facilitate this det...

Contract Act, 1872—Sections 55, 73—The Supreme Court clarified the scope of judicial review under Sections 34 and 37 of the Arbitration and Conciliation Act, 1996, emphasizing that a court cannot act as an appellate body in re-evaluating evidence or substituting its view for that of the arbitrator—Interference is permissible only on specific grounds, such as "patent illegality" or conflict with "public policy." The Court reaffirmed that a plausible view taken by the arbitral tribunal, especially regarding the interpretation of contract terms, should not be overturned under Section 34—The case also addressed the enforceability of liquidated damages in construction contracts under Sections 55, 73, and 74 of the Indian Contract Act, 1872—The Court held that granting an extension of time does ...

Insolvency and Bankruptcy Code, 2016—Section 31—Effect of Approved Resolution Plan under IBC on Extinguished Claims and Execution of Arbitral Awards—The Supreme Court reaffirmed the binding nature of an approved resolution plan under Section 31 of the Insolvency and Bankruptcy Code, 2016 (IBC), holding that it grants the successful resolution applicant a "clean slate." Once approved by the Adjudicating Authority (NCLT), all claims not accounted for in the resolution plan—including statutory dues and operational debts—stand extinguished. Consequently, no party can initiate or continue legal or arbitral proceedings in respect of such claims. Arbitration and Conciliation Act, 1996—Sections 34, 36—Code of Civil Procedure, 1908—Section 47—Execution of Arbitral Award—The C...

Arbitration and Conciliation Act, 1996—Sections 34 & 37—Judicial Review of Arbitral Awards—Scope, Limitations, and Grounds of Interference—The Supreme Court reaffirmed the limited scope of judicial review under Sections 34 and 37 of the Arbitration and Conciliation Act, 1996. Courts cannot modify arbitral awards; they may only set them aside wholly or partially, where the portions are severable. Relying on Project Director, NHAI v. M. Hakeem, it was clarified that appellate courts under Section 37 have no broader powers than courts under Section 34. Indian Contract Act, 1872, Section 73—In this case, the Court found that while the Arbitral Tribunal correctly determined breach of contract and liability, the quantification of damages lacked evidentiary support and violated Section 73 of the Indian C...

Arbitration and Conciliation Act, 1996, Section 37, Section 34—Arbitral award—The appellant challenged the arbitral award concerning a dispute over the execution of a road construction contract, specifically regarding the increased quantity of geogrid for the Reinforced Earth (RE) wall—The dispute centered on whether the Engineer had the authority to revise the rates for additional quantities exceeding the Bill of Quantities (BOQ)—The appellant argued that the increase in geogrid quantity was a variation requiring rate revision under Clause 51.1(a) of the General Conditions of Contract (GCC)—However, the Arbitral Tribunal found that the increase in geogrid quantity was not a variation but a necessary adjustment to meet the approved design, with no change in the scope of work—The Tribunal upheld the...

Arbitration and Conciliation Act, 1996—Sections 31(5)—The court allowed the appeal, ruling that the arbitration petition was filed within the limitation period—The issue arose from the improper service of the signed copy of the arbitral award—The court emphasized that the service of the award on an employee of the partnership firm did not constitute valid service under Section 31(5) of the Arbitration and Conciliation Act, 1996—According to the court, valid service requires direct delivery to the parties involved, and service to an employee was insufficient—As a result, the limitation period for filing the appeal commenced only when the arbitrator refused to provide a copy of the award to the appellants—The court's decision underscores the importance of proper service of the arbitral award for...

Arbitration and Conciliation Act, 1996—Section 16—The Commercial Arbitration Petition, filed under Section 34 of the Arbitration and Conciliation Act, 1996, challenges the impugned award dated 16th December, 2022—The learned Arbitrator has allowed the respondent's claim and directed the respondent to pay INR 7,50,00,000/- along with interest @ 9% p.a. from 1st September, 2021—The respondent, a company registered under the Companies Act, 1956, provided export credit insurance to cover exporters against non-payment from foreign buyers—The respondent had made certain shipments to the insured buyer 'The Chemical Source, Egypt' which remained unpaid—The respondent filed a claim under the Single buyer Exposure Policy (SBE Policy), which had no arbitration clause—The respondent had previously...

Arbitration Award upheld. (A) Arbitration and Conciliation Act, 1996, Section 34—Award passed by Arbitrator—Challenge, scope of—It must also be remembered that proceedings under Section 34 of the Act are summary in nature and are not like a full-fledged regular civil suit—Therefore, the scope of Section 37 of the Act is much more summary in nature and not like an ordinary civil appeal—The award as such cannot be touched unless it is contrary to the substantive provision of law; any provision of the Act or the terms of the agreement—In the case at hand, the arbitral award dated 08.11.2012 is based upon evidence and is reasonable—It has not been found to be against public policy of India or the fundamental policy of Indian law or in conflict with the most basic notions of morality and justice&mda...

(A) Arbitral award—Arbitration and Conciliation Act, 1996—Sections 34, 48 and 37—Arbitral award—In foreign currency—Issue relates to enforcement of—Two questions for consideration—First, what is correct and appropriate date to determine foreign exchange rate for converting award amount expressed in foreign currency to Indian Rupees—Second, what would be the date of such conversion—When award debtor deposits some amount before Court during pendency of proceedings challenging the award—Determination of—Statutory scheme of Act makes a foreign arbitral award enforceable when objections against it are finally decided—Therefore, as per Act and principle in Forasol v. Oil and Natural Gas Commission, 1984 Supp SCC 263 the relevant date for determining conversion rate of forei...

Arbitration and Conciliation Act, 1996—Section 37(1)(c)—An arbitral award under Section 34 was dismissed by the High Court—The appeal by Directorate General Married Accommodation Project (DGMAP) alleged lack of opportunity to present their case—The court upheld the award, citing it plausible and within tribunal's jurisdiction—Emphasizing principles of natural justice, it ruled appellant had fair hearing despite procedural objections—Key clarifications include: (A) representation by counsel suffices for opportunity to present case; (B) denial of technical person's address does not breach opportunity; (C) patent illegality grounds limited to fundamental flaws evident in award's face, not legal errors; (D) award inconsistencies justified by contextual reading, differing figures not fatal; (E) j...

Arbitration and Conciliation Act, 1996—Section 37 – Arbitral Award—Arises from a dispute between Jindal Rail Infrastructure Limited (JRIL) and the Union of India (UOI) concerning additional BOXNHL wagons ordered under a contract—The dispute revolves around the interpretation of a contract clause allowing UOI to increase ordered quantities—The arbitrator awarded JRIL a higher rate for additional wagons, citing economic duress and unfair exercise of power by UOI—However, the court dismissed JRIL's appeal, affirming UOI's right to trigger the contract clause and rejecting JRIL's claims—The court emphasized the clarity of contract terms and upheld UOI's commercial interests in protecting against price fluctuations—Consequently, the appeal was dismissed, affirming the impugned jud...

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Arbitration and Conciliation Act, 1996 – Sections 34—Arbitral award—A dispute arising from a service contract between Iris and Sony, where Iris claimed a fee based on the original purchase order (PO) value, Sony revised the PO, reducing its value—The sole arbitrator awarded Iris the principal amount with interest and costs, upholding its claim—Sony challenged the award under Section 34 of the Arbitration and Conciliation Act, alleging it was contrary to the contract, ignored evidence, and violated public policy—The Additional District Judge dismissed the objections, and Sony appealed to the High Court—The High Court, after analyzing evidence, affirmed the findings, holding that the revised PO included Sony's liability for Iris's claimed amount—The court relied on correspondence, calc...

Arbitral award—Arbitration and Conciliation Act, 1996—Sections 34 and 37—Arbitral award—Civil Appeal—Issue for consideration—Whether High Court was justified in confirming the order passed by Civil Judge under Section 34 of Act of 1996—Whereby award passed by Arbitrator was modified and amount awarded was reduced—Determination of—Supreme Court finds that Arbitrator, as hitherto observed, has awarded 18% interest and same stood reduced by Court below to 9% without any legal basis therefore—In absence of compliance with laid out parameters and contours of both Sections 34 and 37 of A&C Act, impugned judgments are required to be set aside—Award of Arbitrator is restored, for any challenge thereto has failed—Direction to State of Karnataka to expeditiously pay amount&...

Arbitration and Conciliation Act, 1996 , Section 37(1)(C), section 34, Section 28(3)—Arbitral Award—Brokerage agreement—The appellant challenged the arbitral award, claiming it violated Section 28(3) of the Act—The dispute centered around the respondent's assistance in completing a transaction related to land in Goa. The Arbitral Tribunal dismissed the respondent's claims and the appellant's counterclaims, retaining an advance fee—The Single Judge set aside the award, emphasizing the Arbitrator's deviation from the agreement's express terms—The Court noted the respondent's early efforts, the appellants' acknowledgment, and the limited scope of the respondent's obligations—Finding the Arbitrator misconstrued the agreement, the Court upheld the Single Judge's deci...

Arbitration and Conciliation Act, 1996, Sections 34 and 30—Arbitral award regarding interest calculations and counterclaims— The petitioner contests the aggregation of amounts in determining interest, alleging discrepancies—Additionally, the petitioner argues the arbitrator overlooked a counterclaim and wrongly awarded escalation beyond the contract period—The court dismisses these contentions, upholding the interest calculation methodology—It deems the arbitrator's findings reasonable, citing limited interference scope under Section 34 of the Arbitration and Conciliation Act—The court also supports the escalation award, noting the arbitrator's factual determination aligns with precedents—Emphasizing restraint in review, it cites recent Supreme Court decisions and denies grounds for i...

Arbitration & Conciliation Act, 1996—Sections 12(5) and 29A 34—Arbitral awards—The petitioner seeks to set aside two arbitral awards dated 28.06.2023, contending that the sole arbitrator was de jure ineligible under the Seventh Schedule of the Arbitration & Conciliation Act, 1996—The awards pertain to different projects but involve the same parties—The petitioner argues that its participation in the proceedings doesn't preclude challenging the arbitrator's eligibility, citing Section 12(5)—The respondent claims implicit waiver through the petitioner's active participation, including filing a Section 29(A) application—The court, relying on precedent, rejects the notion that a Section 29(A) application constitutes express waiver and allows the petitions, setting aside the awards&...

Arbitration and Conciliation Act, 1996, Section 34—Modifying an arbitral award—The court asserts that the order of August 8, 2019, attempting to modify the previous judgment, is unsustainable as the matter had been finally disposed of—Emphasizing that once a case is concluded, it cannot be reopened without proper legal procedures, the court refers to NHAI vs—M—Hakeem, stating that Section 34 only allows setting aside an award, not modifying it—Citing Larsen Airconditioning, the court rejects the argument that the August 8, 2019 order set aside the award, ultimately allowing the appeal and disposing of pending applications. ...

Arbitration and Conciliation Act, 1996—Sections 37(1)(c), 11, 11(2), 34, 34(2)(iv), 34(2)(b)(iv) and 37—Evidence Act, 1872— Sections 34, 63 and 65—Arbitral award—Challenging the dismissal of an application under Section 34—The dispute involves a partnership concern in the lighting business, with a disagreement over payments and interest—The arbitrator's award favored the claimant on certain issues, leading to the appellant's Section 34 challenge—The appellant contends that the arbitrator exceeded jurisdiction by considering invoices beyond the reference scope—The court, in its analysis, emphasizes the limited grounds for setting aside awards under Sections 34 and 37, citing relevant cases—The appeal is deemed lacking in merit, and the court upholds the arbitrator'...

(A) Arbitration and Conciliation Act, 1996—Section 34—Setting aside of arbitral award—The statement indicates that when exercising jurisdiction under Section 34 of the Act, a court should refrain from casually or cavalierly interfering with an arbitral award. Interference is only justified when the court identifies a clear and evident illegality or perversion that strikes at the core of the matter. Mere potential for an alternative perspective on facts or contract interpretation is insufficient grounds for intervention. (B) Arbitration and Conciliation Act, 1996—Section 34—Setting aside of arbitral award—Additionally, it emphasizes that an arbitral tribunal has the authority to issue directions for the payment of interest on the amount determined in the award, encompassing both the principal sum and ...

Arbitration and Conciliation Act, 1996—Section 12—Ground for challenge—Arbitral award—Chennai Metro Rail Limited (Chennai Metro) and Afcons arbitration case, a dispute arose when the arbitration tribunal unilaterally increased arbitrators' fees—Chennai Metro objected, alleging potential bias and filed a Section 14 application to terminate the tribunal's mandate. The court clarified that a breach of the fee agreement, while an issue, doesn't automatically render the tribunal ineligible—It emphasized that challenges to arbitrators mid-arbitration must be based on the statutory grounds listed in Section 12(5) and not on other unenumerated grounds—The court stressed the importance of demonstrating a real likelihood of bias and the need for objective evidence to establish it—Ultimatel...

Arbitration and Conciliation Act, 1996 - Section 34 - Arbitral award—Court is restricted from modifying an arbitral award based on its own reappreciation of evidence, effectively acting as the arbitrator. However, there is room within this maximalist position for the court to set aside or modify portions of the arbitral award that are severable from the rest, as long as doing so will not cause the entire award to collapse. This means that while the court cannot fundamentally alter the award, it can address specific parts or issues within the award that are separable without compromising the entire decision. ...

Arbitration and Conciliation Act, 1996—Section 34, Section 34(2), Section 34(2)(b)(ii), Section 37, Section 75, Section 81—Indian Contract Act, 1872—Section 53, Section 54, Section 55, Section 73—Arbitral award—Petition challenging an concession agreement—Award pertains to compensation claims made by the contractor for delays in the project—The NHAI argued that certain clauses of the agreement should apply to determine damages, while the contractor disagreed. The arbitral tribunal interpreted the agreement and found that damages should be calculated as per a specific clause. The court, in its limited scope of interference, found the tribunal's view plausible and upheld the award, citing the amendment to Section 34 of the Arbitration & Conciliation Act, 1996. The petition was dismissed. ...

Land Acquisition Act, 1894—Sections 18, 6—Interpretation of Statute—Doctrine of harmonious construction in the interpretation of statutes suggests that a document must be read as a whole and in its entirety—If there is any ambiguity, whether obvious or concealed, in any of the clauses of the document, courts should interpret that particular clause in a way that is consistent with the other clauses and aligns with the purpose and intent of the parties who executed it. ...

Contract—Arbitration and conciliation Act, 1996—Section 34—Arbitral award—Modified by High Court—Reduced the interest—From  compound interest 18% to 9% simple interest per annum—Appeal against—Determination of—Denial of natural justice—In appeal, Section 37, of the Act grants narrow scope to appellate  Court to review finding in an award, if it has been upheld, or substantially upheld under Section 34—It is important to notice that old Act contained a provision which enabled the Court to modify an award—Power has been consciously omitted by Parliament, while enacting Act of 1996—Impugned judgment warrant interference and is set aside to extent of modification of rate of interest for post, pendente lite and future interest—18% per annum rate of in...

Arbitration and Conciliation Act, 1996, S.29A —  this legal case, the court discusses the application of Section 29A of the Arbitration and Conciliation Act, 1996, —  before and after its amendment in 2019. — The amendment excluded international commercial arbitrations from the mandatory twelve-month timeline for making arbitral awards. — The court ruled that this amendment is applicable retrospectively to all pending arbitrations as of August 30, 2019. — The sole arbitrator is authorized to decide on further extensions of time, ensuring an expeditious conclusion of the arbitration. ...

Arbitration and Conciliation Act, 1996—Sections 34 and 37—Arbitral awarded compensation of Rs. 45,000 per km per month—However, it was found that this award was unjustified beyond January 2008 when the additional traffic diversion ceased—Therefore, the award for the period from February 2008 to May 2010 was set aside while confirming the award for the preceding period—Appeal was partially allowed. ...

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Arbitration and Conciliation Act, 1996—Section 34(2)—Limitation Act, 1963—Section 14—Arbitral award—Present appeal, filed with special permission, challenges a decision made by the High Court of Madhya Pradesh in a Civil Revision case—The High Court upheld the perspective of the Additional District Judge in Bhopal, who had determined that the respondent's objection under Section 34(2) of the Arbitration & Conciliation Act, 1996, was eligible for condonation under Section 14 of the Limitation Act, 1963—The Court observes that the respondent had the option to either participate in the arbitration proceedings or promptly initiate the appointment of an arbitrator or submit objections within the stipulated time under Section 34(2) of the Act—However, the respondent chose a different appro...

Arbitration and Conciliation Act, 1996—Section 31(3), Section 34—Arbitral award—Arbitrator did not record findings as required by the arbitration agreement—Division Bench of the High Court affirmed this view—Supreme Court held that the expression "finding" in the arbitration agreement included the requirement to provide reasons for the conclusions, and, therefore, the Arbitrator was obligated to record reasons for the award—Case was remitted to the Arbitrator for a fresh determination with reasons—Court also clarified that the proceedings should be conducted expeditiously under the Arbitration Act of 1940, and if the initially nominated Arbitrator couldn't proceed, a substitute should be appointed within a specified timeframe. ...

Contract Act, 1872—Section 7(2)—Arbitration Act, 1940—Section 30, Section 39—Jurisdiction over an arbitral award concerning a construction contract dispute—The appellant submitted a tender for constructing married accommodation for naval personnel, claiming a 40% labor component—The respondent disputed this, asserting a 20% labor component—The appellant clarified, maintaining a 40% claim—The respondent accepted the tender, but disputes arose, leading to arbitration.The Arbitrator awarded in favor of the appellant on three main claims: 2.25% additional payment, labor escalation at 40%, and higher minimum wages—The respondent challenged the award in court, arguing the Arbitrator exceeded jurisdiction by relying on the tender letter and ignoring the final contract.The Division Bench parti...

Civil Procedure Code, 1908 (CPC)—Order 23 Rule 2—Arbitration Act, 1940—Section 30, Section 33—Arbitration and Conciliation Act, 1996—Section 11, Section 11(4),—Central issue revolved around whether the period spent in prosecuting a remedy before a court without jurisdiction could be excluded—The appeals originated from a dispute between M/s. Western Builders and the State of Goa, with an arbitrator awarding a sum to the claimant—The State of Goa contested the award, leading to a legal battle—The lower courts had rejected the application u/s 14 of the Limitation Act, holding that the Arbitration Act, 1996, provides a complete code with a specified limitation period for setting aside an award—However, the appellant argued that Section 14 of the Limitation Act should be applicable u...

Arbitration and Conciliation Act, 1996—Section 2, Section 31, Section 31(5),—Arbitral award—Southern Railway and respondent No. 1 for gauge conversion—An arbitral tribunal delivered its award on 10/11.03.2001, and the Chief Engineer, representing the Union of India, received the copy on 19.3.2001—The Chief Engineer filed an application to set aside the award under Section 34 of the Arbitration and Conciliation Act, 1996, seeking condonation of a 27-day delay—The High Court, however, held the application barred by limitation, calculating the delay from the date of receipt in the General Manager's office—The Supreme Court disagreed, ruling that the effective date of receipt for limitation purposes is when the Chief Engineer, directly involved and aware of the proceedings, received the award&mdas...

Civil Procedure Code, 1908 (CPC)—Section 100, Section 34—Arbitration Act, 1940—Section 13, Section 14—General Clauses Act, 1897—Section 3(19), Section 6—Pertains to the enforcement of an arbitral award made under the Arbitration Act, 1940, after the coming into force of the Arbitration and Conciliation Act, 1996—Section 85(2)(a) of the 1996 Act is the saving clause that exempts the old Act from complete obliteration, particularly concerning pending arbitration proceedings—The court held that the enforcement of an award made under the old Act, even after the new Act came into force, should be examined based on the provisions of the old Act—The saving clause prevents the accrued right under the old Act from being affected—The court emphasized that the provisions of the old Act woul...