The court emphasized the limited scope of interference with arbitral awards, highlighting the principles of public policy and reasonableness in upholding the Arbitrator's decision.

VIBHU BAKHRU, J

1. These are petitions filed under Section 34 of the Arbitration and Conciliation Act, 1996 (hereafter 'the Act') impugning an arbitral award (hereafter 'the impugned award') dated 01.02.2016 passed by the Sole Arbitrator Justice C. M. Nayar (Retd.), a former judge of this Court.

2. Roentgen Oncologic Solutions Pvt. Ltd. (hereafter 'ROSPL') is a company incorporated under the provisions of the Companies Act, 1956 and is, inter alia, engaged in the business of setting up, running and/or managing oncology centers in India. Mr. S. L. Kapoor, Dr S. Hukku, Mr. s Rachna Hukku, Mr. s Rekha Kapoor and Dr Shikha Haldar (hereafter referred to as 'the Promoters') are the promoters of ROSPL.

3. OMP No.62/2016 is preferred by ROSPL and the Promoters. OMP No.295/2016 is preferred by Dr Kirti Jain.

4. The parties entered into a shareholder's agreement dated 30.06.2008 (hereafter 'the Agreement') whereby Dr Kirti Jain agreed to acquire 49% of the outstanding share capital of ROSPL for a consideration of Rs.1,21,85,143/-. In terms of clause 5.3.1 of the Agreement, Dr Kirti Jain also agreed to arrange funds equivalent to Rs.5,64,94,120/-. The said clause is quoted below:-

“5.3.1 As on date, the company has a liability in its books of accounts of Rs.5,88,00,000/-(Rupees Five crores Eighty Eight Lakhs only) raised as loan from GE Capital, against which the Promoters have provided their personal assets as collaterals. It is agreed between the parties that the Investor shall be issued 22,578 shares (49%) subject to fulfillment of the condition that the Investor arranges for funds equivalent to Rs.5,64,94,120/- (Rupees Five Crores Sixty Four lacs Ninety Four Thousand One Hundred and twenty only) i.e. proportionate to the loan already raised by the company from GE Capital against collaterals provided by the Promoters by way of debt in the name the company by providing his (i. e. the Investors') personal collaterals. It is agreed that such loan arranged for the Company by the Investor shall be subject to a maximum ceiling of interest rate, being the prevailing rate of interest payable by banks in India on similar loan portfolios. The Investor hereby gives the undertaking that for this Agreement to be valid he would provide appropriate collateral so that the company can raise debt aggregating Rs.5,64,94,120/-.”

5. Certain disputes arose between the parties in relation to the Agreement. It is the case of ROSPL and the Promoters, that Dr Kirti Jain had failed to arrange for the funds as agreed by him. This is disputed by Dr Jain. According to him, he was not required to arrange for funds but only to provide collateral for the loan to be arranged by ROSPL/the Promoters. It is also Dr Jain's case that ROSPL had failed to provide the relevant documents necessary for arranging the required funds. He further asserts that he was not made a Director of ROSPL and this also hindered his ability to raise the funds required by ROSPL.

6. The Arbitrator considered the rival contentions and concluded that although there may have been lapses on the part of the ROSPL and the Promoters but Dr Jain neither arranged the loan nor provided any collateral; therefore, the terms of the Agreement were not satisfied.

7. The Arbitrator categorically found that the condition imposed on Dr Kirti Jain was not fulfilled. He further observed that “the fait accompli is that the provisions of Clause 5.3.1 remain unsatisfied and are not complied with irrespective of the averments made by the claimant and counter averments as made by the respondents.” In view of the findings, the Arbitrator concluded that the allotment of shares to the extent of 49% to Dr Kirti Jain could not be justified. He accordingly, directed that the amounts paid by Dr Kirti Jain be refunded along with interest.

8. Mr. Vasisht, the learned senior counsel appearing for ROSPL and the Promoters contended that although the Arbitrator had found in favour of the ROSPL and the Promoters that Dr Kirti Jain had