Arbitration Monthly Round-Up: January 2024

Supreme Court Arbitral Awards Cannot Be Modified Under Sections 34 & 37 Of Arbitration & Conciliation Act : Supreme Court Case Title: S.V. Samudram v. State of Karnataka Citation: 2024 LiveLaw (SC) 14 The Supreme Court has reiterated the settled position of law that any attempt to “modify an award” while adjudicating Sections 34 and 37 petitions is not permissible under the Arbitration and Conciliation Act, 1996. The Division Bench of Supreme Court comprising Justices Abhay S. Oka and Sanjay Karol while deciding a Civil Appeal filed by the Appellant against the judgment and order passed by the High Court of Karnataka under Section 37 (1) of the Arbitration and Conciliation Act, 1996, framed a question of law that: “Whether the High Court was justified in confirming the order dated 22nd April, 2010 under Section 34 of the Arbitration & Conciliation Act, 1996 passed by the Senior Civil Judge, Sirsi, in Civil Misc. No. 08/2003, whereby the award passed by the learned Arbitrator was modified and the amount awarded was reduced.” Supreme Court Issues Notice On Plea Challenging Validity Of Section 3G Of National Highways Act Case Title: B.D. Vivek v. Union of India, Writ Petition Civil No. 1364 of 2023 The Supreme Court Bench of Justices B.V. Nagrathna and Ujjal Bhuyan has issued notice on a writ petition challenging the Constitutional Validity of Section 3G of the National Highways Act, 1956. The writ petition questions the legality of Section 3G(5) of the Act. This section mandates arbitration to resolve disputes over the compensation amount payable to landowners when their land is acquired. The arbitration is to be conducted by an arbitrator appointed by the Central Government. The petitioner argues that Section 3G(5) violates Article 14 of the Indian Constitution. The contention is that imposing mandatory arbitration, with an arbitrator selected solely by the Central Government, unfairly biases the process against the landowners. Delhi High Court Arbitral Tribunal Can Award Damages For Delay By Employer Even In Absence Of Any Clause In Agreement : Delhi High Court Case Title: MBL Infrastructure Ltd v. DMRC, OMP(COMM) 311 of 2021. The High Court of Delhi has held that the Arbitral tribunal can award monetary compensation as damages for the delay attributable to employer even when the agreement provides for the extension of time as the only remedy to the contractor. The bench of Justice Chandra Dhari Singh held that the tribunal cannot deny damages on the ground that the agreement provides only for extension of time, especially when the agreement has already been terminated by the employer and there is no occasion for the contractor to seek extension. It held that the tribunal, in such a situation, has to necessarily compensate the contractor in terms of unliquidated damages. Arbitral Tribunal Can Go Beyond To Grant Relief To Aggrieved Party When Contract Illegally Restricts Remedies : Delhi High Court Case Title: MBL Infrastructure Ltd v. DMRC, OMP(COMM) 311 of 2021. The High Court of Delhi has held that an Arbitral Tribunal can transgress the boundaries of the contract to grant relief to aggrieved party when the contract illegally restricts or does not provide for sufficient remedies. The bench of Justice Chandra Dhari Singh held that in a situation which is not anticipated in the agreement, the tribunal can transgress the boundaries of the agreement and grant relief to the aggrieved party which it is rightfully entitled to. It held that the tribunal cannot withhold a relief merely because of the explicit provision for such a relief in the agreement. Non-Mentioning Of Prayer Renders The Petition Under Section 34 Of The A&C Act As Invalid: Delhi High Court Case Title: Union of India v. M/s Panacea Biotec Limited, FAO(OS)(COMM) 81 of 2020 The High Court of Delhi has held that non-mentioning of prayer renders the petition under Section 34 of the A&C Act as invalid. The bench of Justices Suresh Kumar Kait and Neena Bansal Krishna held that without a prayer to set aside the impugned award, a petition cannot be considered valid as such petitions would merely amount to empty submissions without a relief. The Court held that without a prayer, the Court cannot decipher the relief that a party is seeking on the basis of the averments made in the petition and without seeking relief, the petition is not maintainable rendering it non-est. The Court emphasized that condoning the delay in re-filing the petitions beyond the prescribed period of 3 months plus 30 days would entangle arbitrations in a web of prolonged delays. Such a situation, the Court reasoned, would undermine the very purpose of opting for arbitration, rendering it meaningless. Under Section 34(3) Of The A&C Act, The Limitation Period Of 3 Months Plus 30 Days In Inelastic And Inflexible: Delhi High Court...

Arbitration Monthly Round-Up: January 2024

Rajesh Kumar

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