High Court of Delhi

Union of India Vs. Indian Agro Marketing Co-Operative Ltd.

MANU/DE/4405/2023

11.07.2023

Arbitration

Court does not sit in appeal over the arbitral award and may interfere on merits on the limited grounds

The present appeal filed under Section 37 of the Arbitration and Conciliation Act, 1996 impugns order passed by trial Court whereby, the objection petition filed by the Appellant under Section 34 of said Act has been dismissed.

Admittedly, the Appellant did not lead any evidence or place any material to establish that it had suffered any loss or damages on account of non-delivery of commodity in question. It is also not the case of appellant that, it had to procure the same from any other source at a higher value.

In MMTC Ltd. v. Vedanta Ltd., it has been observed that as far as interference with an order made under Section 34 of the Act is concerned, it cannot be disputed that such interference under Section 37 cannot travel beyond the restrictions laid down under Section 34 of the Act. The court cannot undertake an independent assessment of the merits of the award, and must only ascertain that the exercise of power by the court under Section 34 has not exceeded the scope of said provision. As far as Section 34 of the Act is concerned, the position is well-settled that the Court does not sit in appeal over the arbitral award and may interfere on merits on the limited grounds. It thus needs no reiteration that, interference under Section 37 of Act does not entail a review of the merits of the dispute, and is limited to situations where the findings of the arbitrator are arbitrary, capricious or perverse, or when the conscience of the Court is shocked, or when the illegality is not trivial but goes to the root of the matter. An arbitral award may not be interfered with, if the view taken by the arbitrator is a possible view based on facts.

There is nothing which may indicate any patent illegality or absolutely unjustifiable or unreasonable interpretation of contractual terms or where the conclusion has been arrived at by ignoring vital evidence or where it is based on 'no evidence'. In view of the settled position of law and on consideration of the factual aspects, there is no reason to interfere. Appeal dismissed.

Tags : Award Objection Grounds

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