SupremeToday Landscape Ad
Back
Next
Judicial Analysis Court Copy Headnote Facts Arguments Court observation
Listen Audio Icon Pause Audio Icon
judgment-img

2022 Supreme(Del) 509

IN THE HIGH COURT OF DELHI AT NEW DELHI
C. HARI SHANKAR, J.
Easy Trip Planners Ltd – Appellant
Versus
One97 Communications Ltd - Respondent
CM(M) 707 of 2022 & CM APPL. 32174, 32175 of 2022
Decided on : 25-07-2022

Advocates:
Advocate Appeared:
For the Appellant : Mr. Rajshekhar Rao, Sr. Adv. with Mr. Kushagra Bansal, Adv.
For the Respondent: Mr. Aman Nandrajog, Mr. Dhruv Wadhwa, Advs.

Point of Law: Section 34 of the 1996 Act permits a challenge “against an arbitral award ... only by an application for setting aside such award”. “Arbitral award” is defined, in clause (c) of Section 2(1), as “including an interim award”.

Headnote:

Code of Civil Procedure, 1908 - Order VII Rule 14 - Arbitration and Conciliation Act, 1996 - Section 37 - Constitution of India, 1950 - Article 226 or 227 - Arbitral proceedings - Interim arbitral award - Additional documents - Sought to advance a submission that rationale of para 45 of the decision in SEP, as apparent from passage, was that the interim order, being sought to be challenged under Article 226 or 227 of Constitution of India, would otherwise be amenable to challenge under Section 34 of Act. He bases this submission on the observation, to be found in said passage, that “under Section 34, aggrieved party has an avenue for ventilating his grievances against the award including any in-between orders that might have been passed by arbitral tribunal acting under Section 16 of Act”. In other words, he submits that the bar to maintainability of the remedy under Articles 226 and 227 of Constitution, as set out in para 45 of SBP, would be limited to cases where the order would be amenable to challenge under Section 34 - The remedy available to litigant is deferred to a later stage of proceedings, so as to ensure that the arbitral stream continues to flow unsullied and undisturbed by any eddies that may impede its path.(Para 18)

Finding of the court :

It is settled law that when a statutory forum is created by law for redressal of grievances, a writ petition should not be entertained ignoring the statutory dispensation - It would always be open to aggrieved litigant to vent its ire against interim order as one of grounds on which it seeks to assail interim or final arbitral award, under Section 34 - The obvious reason why Bhaven Construction would not help the petitioner is because, even as per SBP, party is not remediless in ventilating its grievances against the interim order passed by the Arbitral Tribunal. The remedy would, however, lie against the interim award or the final award that the arbitral tribunal would choose to pass. It would always be open to the aggrieved litigant to vent its ire against the interim order as one of the grounds on which it seeks to assail the interim or final arbitral award, under Section 34 - Till then, however, SBP requires the litigant to bide his time.

Result: Petition is dismissed

ORDER :

1. A learned three-member Arbitral Tribunal has, in arbitral proceedings between the parties of which it is in seisin, passed an interlocutory order on 18th June 2022, rejecting an application filed by the petitioner under Order VII Rule 14 of the Code of Civil Procedure, 1908, to bring on record additional documents.

2. This petition, under Article 227 of the Constitution of India, assails the said order.

3. To my mind, the present petition is not maintainable, in view of the following enunciation of the law, to be found in paras 45 and 46 of the report in SBP & Co. v. Patel Engineering Ltd., (2005) 8 SCC 618:

    “45. It is seen that some High Courts have proceeded on the basis that any order passed by an arbitral tribunal during arbitration, would be capable of being challenged under Article 226 or 227 of the Constitution of India. We see no warrant for such an approach. Section 37 makes certain orders of the arbitral tribunal appealable. Under Section 34, the aggrieved party has an avenue for ventilating his grievances against the award including any in-between orders that might have been passed by the arbitral tribunal acting under Section 16 of the Act. The party aggrieved by any order of the arbitral tribunal, unless has a right of appeal under Section 37 of the Act, has to wait until the award is passed by the Tribunal. This appears to be the scheme of the Act. The arbitral tribunal is after all, the creature of a contract between the parties, the arbitration agreement, even though if the occasion arises, the Chief Justice may constitute it based on the contract between the parties. But that would not alter the status of the arbitral tribunal. It will still be a forum chosen by the parties by agreement. We, therefore, disapprove of the stand adopted by some of the High Courts that any order passed by the arbitral tribunal is capable of being corrected by the High Court under Article 226 or 227 of the Constitution of India. Such an intervention by the High Courts is not permissible.

46. The object of minimizing judicial intervention while the matter is in the process of being arbitrated upon, will certainly be defeated if the High Court could be approached under Article 227 of the Constitution of India or under Article 226 of the Constitution of India against every order made by the arbitral tribunal. Therefore, it is necessary to indicate that once the arbitration has commenced in the arbitral tribunal, parties have to wait until the award is pronounced unless, of course, a right of appeal is available to them under Section 37 of the Act even at an earlier stage.”(Emphasis supplied)

There is no equivocation, whatsoever, in the exposition of the legal position by the Supreme Court, in the afore-extracted passages. The Court can be approached against an interim order in arbitral proceedings only if the order is appealable under Section 37[[37. Appealable orders. –

(1) Notwithstanding anything contained in any other law for the time being in force, an appeal shall lie from the following orders (and from no others) to the court authorised by law to hear appeals from original decrees of the Court passing the order, namely:-

(a) refusing to refer the parties to arbitration under Section 8;

(b) granting or refusing to grant any measure under Section 9;

(c) setting aside or refusing to set aside an arbitral award under Section 34.

(2) An appeal shall also lie to a court from an order of the arbitral tribunal-

(a) accepting the plea referred to in sub-section (2) or sub-section (3) of Section 16; or

(b) granting or refusing to grant an interim measure under Section 17.

(3) No second appeal shall lie from an order passed in appeal under this section, but nothing in this section shall affect or take away any right to appeal to the Supreme Court.] of the Arbitration and Conciliation Act, 1996 (“the 1996 Act”). In all other cases, the litigant, who deems himself aggrieved, has to await the conclusion of the arbitral proceedings and rendition

    Click Here to Read the rest of this document
    1
    2
    3
    4
    5
    6
    7
    8
    9
    10
    11
    SupremeToday Portrait Ad
    supreme today icon
    logo-black

    An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers

    Please visit our Training & Support
    Center or Contact Us for assistance

    qr

    Scan Me!

    India’s Legal research and Law Firm App, Download now!

    For Daily Legal Updates, Join us on :

    whatsapp-icon Back to top