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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
SOMASEKHAR SUNDARESAN
Kantilal Chhaganlal Securities Pvt. Ltd. – Appellant
Versus
Viveka Kumari – Respondent
| Table of Content |
|---|
| 1. factual background of unauthorized trades and awards (Para 1 , 2 , 3) |
| 2. challenges for ignoring eow complaint and tax returns (Para 4 , 5 , 6 , 7) |
| 3. limited section 34 review for perversity only (Para 8 , 9 , 10 , 11 , 12 , 13) |
| 4. eow complaint vital evidence of authorization (Para 14 , 15 , 16 , 17 , 18 , 19 , 20 , 21 , 22 , 23 , 26 , 27 , 28) |
| 5. party sophistication relevant to fraud claims (Para 24 , 25) |
| 6. tax returns prove contemporaneous trade acceptance (Para 29 , 30 , 31 , 32 , 33 , 34 , 35 , 36 , 37) |
| 7. ignoring vital evidence causes patent illegality (Para 38 , 39 , 40 , 41 , 42) |
| 8. perversity from no evidence warrants interference (Para 43 , 44) |
| 9. awards quashed for fresh arbitration (Para 45 , 46 , 47 , 48) |
JUDGEMENT:
SOMASEKHAR SUNDARESAN, J.
Context and Factual Background:
1. This is a Petition filed under Section 34 of the Arbitration and Conciliation Act, 1996 (“the Act”), challenging an arbitral award dated April 8, 2014, which is an appellate award (“Appellate Award”) that refused to interfere with an earlier arbitral award dated October 23, 2013 (“First Award”), thereby holding the Petitioner, Kantilal Chhaganlal Securities Private Limited (“Kantilal”)
Arbitral awards set aside under Section 34 for perversely ignoring vital evidence like party's police complaint admitting trade authorisation and tax returns, constituting patent illegality.
A party cannot claim lack of authorization for trades where active participation and knowledge of transactions are evident.
An arbitral award obtained through fraud and misrepresentation violates public policy, rendering it unenforceable under the Arbitration and Conciliation Act.
An arbitral tribunal lacks inherent jurisdiction to adjudicate a claim against a third party arising out of a private transaction not governed by an arbitration clause.
Judicial review of arbitral awards under the Arbitration and Conciliation Act is limited, focusing on adherence to public policy and fundamental legal principles.
Absence of prior written instructions does not absolve a client of liability for trades if evidence shows active participation and knowledge.
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