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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ALOK ARADHE, CJ, SANDEEP V. MARNE
Larsen & Tourbo Limited – Appellant
Versus
Hindustan Petroleum Corporation Ltd. – Respondent
JUDGMENT :
SANDEEP V. MARNE, J.
The Challenge
1. These are cross appeals filed under provisions of Section 37 of the Arbitration and Conciliation Act, 1996 (the Act) challenging the judgment and order dated 16 November 2005 passed by learned Single Judge of this Court in Arbitration Petition No. 449 of 2003. Arbitration Petition No. 449 of 2003 was filed by Hindustan Petroleum Corporation Limited (HPCL) challenging the award made by the Arbitral Tribunal on 4 July 2003 by which, various claims raised by the original claimant-Larsen and Turbo Limited (L&T) were granted. By the impugned order dated 16 November 2005, the learned Single Judge has set aside the award qua Claim Nos. 1, 2, 4, 9, 15, 16, 21(1), 21(3) and 21(4) awarded by the Arbitral Tribunal. The learned Single Judge has retained the award only to the extent of Claim No. 19. Accordingly, original Claimant-L&T has filed Appeal No. 26 of 2006 to the extent of setting aside the award qua Claim Nos. 1, 2, 4, 9, 15, 16, 21(1), 21(3) and 21(4) whereas the original Respondent-HPCL has filed Appeal No. 14 of 2006 to the extent of the learned Single Judge maintaining the award qua Claim No. 19.
Facts
2. A tender was floated by HPCL for
Court's intervention under Section 34 is valid when arbitral award lacks evidence or deviates from contractual terms, while retention of claims based on clear factual findings is upheld.
Point of law: Arbitral Tribunal is not bound by the Code of Civil Procedure or the Indian Evidence Act.
The judiciary's role in arbitration is to ensure courts do not reassess merits but identify manifest errors and whether vital evidence was overlooked by the arbitral tribunal.
The appeal was allowed, reinstating the arbitrator's award which concluded that the termination of the contract was illegal due to failure in fulfilling mutual obligations concerning site availabilit....
The court confirmed the validity of the Arbitrator's findings regarding excess work claims and the correct application of interest, highlighting that overlapping interest claims were erroneous.
The scope of interference with an Arbitral Award under Section 34 of the Arbitration and Conciliation Act, 1996 is fairly limited and narrow. The Courts shall not sit in an appeal while adjudicating ....
The court affirmed that arbitral awards challenging under Sections 34 and 37 are limited in scope, requiring clear evidence of illegality or perversion; otherwise, the Arbitrator's decision stands.
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