Single Petition U/S 34 Of Arbitration Act Is Maintainable Against Composite Arbitral Award: Calcutta High Court

The Calcutta High Court has held that a single petition under section 34 of the Arbitration and Conciliation Act, 1996 (Arbitration Act) is maintainable challenging a composite arbitral award disposing of multiple references. A bench led by Justice Shampa Sarkar held that “the Court does not hesitate to hold that the learned arbitrator and the parties understood the proceeding before the learned arbitrator arising out of five references, to be one composite proceeding and the learned arbitrator proceeded to pass a composite award. Thus, in the present case, though five distinct references were made, the learned arbitrator had chosen to dispose of all the references by passing one composite award at the suggestion of the parties. When a common award covers all the references, the challenge by way of a single petition is maintainable.” Background: Five separate tenders were floated by Damodar Valley Corporation (DVC) for coal handling services at its thermal power stations between 2013 and 2015. AKA Logistics emerged as a successful bidder in all five tenders. Thereafter, five separate work orders were issued between 2014 and 2016. Disputes arose regarding non-payment of revised minimum wages and deduction of punitive overloading (POL) charges. Five separate notices were issued under section 21 of the Arbitration Act. Subsequently, five different applications were also filed under section 11 of the Arbitration Act. The High Court appointed a sole arbitrator in five separate orders dated 22 September 2021. During the arbitral proceedings, the parties consented to an analogous hearing. By the fourth sitting on 26 July 2022, AP No. 353 of 2021 was treated as the main matter. Evidence was recorded in a composite manner. The arbitrator delivered a single award on 24 April 202 which was later corrected. AKA filed five separate execution applications. DVC, however, challenged the award by filing a single petition under section 34 of the Arbitration Act and sought unconditional stay under Section 36(2) of the Arbitration Act by a single application. AKA objected on the ground that five different petitions should have been filed challenging the award. Findings: Justice Sarkar examined the arbitral record and observed that all five references were dealt with as one composite proceeding. One of the matters was treated as the lead matter and both the parties advanced evidence in respect of both the claims. The court further noted that the interest rate at 9% was awarded by the arbitrator on the total consolidated amount which further fortifies the conclusion that the arbitrator treated all the references as one adjudication. It relied on State of Orissa v. Damodar Das where it was held that when several disputes are decided by single award, it retains the character of one award for the purpose of challenging it under section 34 of the Arbitration Act. The court rejected the contentions of the AKA that CPC provides for separate appeals from multiple decrees. It held that “the arbitral award cannot be equated with a decree of a civil suit… An arbitral award (composite) is one unit of adjudication. Only the act of delivery of five copies of the self-same award by the learned arbitrator will not change the nature, form and character of the award from a composite one, to five separate and distinct awards.” On unconditional stay of the award, the court observed that no prima facie case of fraud or corruption was established. It relied on the Delhi High Court's judgment in NTPC Ltd. where it was held that unconditional stay on the award under section 36(2) of the Arbitration Act is a very narrow exception after amendment acts of 2015 and 2021. Justice Sarkar held that “Mere allegations are insufficient and specific credible materials are to be shown. Unless the courts could, prima facie, find evidence of fraud and corruption or violation of any law, the question of unconditional stay did not arise.” Accordingly, the court directed the DVC to deposit Rs. 3.68 crore with the Registrar within ten weeks. Case Title: Damodar Valley Corporation Vs. AKA Logistics Private Limited Case Number: AP-COM -166 of 2025 Judgment Date: 23/09/2025 For the Petitioner: Mr. Amitesh Banerjee, Sr. Adv. Mr. Swarajit Dey, Adv. Mr. Saptarshi Kar, Adv. Ms. Debarati Das, Adv. For the Respondent : Mr. Ratnanko Banerji, Sr. Adv. Mr. Rajashi Datta, Adv. Mr. Shounak Mukhopadhyay, Adv. Mr. Neelash Choudhury, Adv. Ms. Anuradha Poddar, Adv. Click Here To Read/Download The Order

Single Petition U/S 34 Of Arbitration Act Is Maintainable Against Composite Arbitral Award: Calcutta High Court

Mohd Malik Chauhan

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Mohd Malik Chauhan

Single Petition U/S 34 Of Arbitration Act Is Maintainable Against Composite Arbitral Award: Calcutta High Court

Mohd Malik Chauhan

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