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2025 Supreme(Mad) 4526

IN THE HIGH COURT OF JUDICATURE AT MADRAS
Abdul Quddhose, J.
M/s.Bindu Appalam Depot and others - Applicants
Versus
M/s.Emayam Industries P. Ltd. - Respondent
A.No.697 of 2025
Decided On : 11-06-2025

Court's intervention in arbitration proceedings is limited to cases of glaring error; otherwise, Arbitral Tribunal's decisions on witness summons will be upheld.

Headnote:(A) Arbitration and Conciliation Act, 1996 - Section 27 - Application filed seeking approval of court for order passed by Arbitral Tribunal to summon witnesses - Applicants argued the necessity of examining witnesses due to denial of receipt issuance by respondent - Respondent objected on grounds of non-association of witnesses and lack of reasoning by Arbitrator. (Paras 1-4, 8-14)

(B) Interference by Court - Court's power to interfere with Arbitral Tribunal's order under Section 27 is limited to cases of glaring error - No such error was found in the Tribunal's decision allowing witness examination. (Paras 8, 14)

Facts of the case:
The applicants sought court approval for an order by the Arbitral Tribunal allowing witness examination. The respondents raised objections citing lack of reasoning and unavailability of witnesses.

Findings of Court:
The order from the Tribunal to allow witness examination was upheld as no glaring error was evident, allowing for judicial deference to the Tribunal's decision-making.

Issues: Whether the court can interfere under Section 27 of the Arbitration Act in the absence of a glaring error by the Arbitral Tribunal.

Ratio Decidendi: The court held it cannot interfere unless there is a glaring error and determined that the Tribunal's decision did not exhibit such an error.

Result: Application allowed.

Table of Content
1. approval needed for witness examination - What procedural rights do applicants have in arbitration? (Para 1 , 2 , 3)
2. counterarguments against witness examination - Can the tribunal refuse to summon witnesses? (Para 4 , 6)
3. no interference unless glaring error - Can the tribunal refuse to summon witnesses? (Para 5 , 8 , 14 , 16)
4. court's discussion on permissible arbitral error. - What constitutes a glaring error in arbitration? (Para 9)
5. arbitrator's discretion to summon witnesses - What constitutes a glaring error in arbitration? (Para 10 , 11 , 12 , 13)
6. conditions for court intervention in arbitral orders. - Under what circumstances can a court interfere with arbitral orders? (Para 15)
7. application allowed; approval granted - What is the outcome of the witness examination request? (Para 17 , 18)

ORDER :

Abdul Quddhose, J.

This application has been filed under Section 27 of the Arbitration and Conciliation Act seeking seal of approval of this Court of the order passed by the Arbitral Tribunal, rendering assistance for the applicants to examine two witnesses, namely, Ms.S.Pavithra and Ms.V.Priya.

2. Under the order for which approval is sought for, the applicants had sought the assistance of the Arbitral Tribunal to examine the aforesaid witnesses. Under the order, the Arbitral Tribunal has allowed the request made by the applicants. The applicants seek seal of approval of this Court of the order passed by the Arbitral Tribunal under Section 27 of the Arbitration and Conciliation Act, 1996.

3. The applicants are the respondents and the respondent is the claimant in the Arbitration. During the examination of witnesses, the applicants claim that there became a necessity for the applicants to make a request to the Arbitrator for examination of the aforesaid two witnesses, since the respondent/claimant has categorically denied that they had issued receipts, which have been signed by the aforesaid two witnesses, namely, Ms.S.Pavithra and Ms.V.Priya. According to the applicants, they have paid the entire dues of the respondent/claimant and the receipts were signed by Ms.S.Pavithra and Ms.V.Priya for the confirmation of the same. The Arbitrator has acceded to the request of the applicants for the examination of the aforesaid two witnesses through the Arbitrator’s order dated 25.09.2024.

4. The respondent/claimant has filed a counter before this Court objecting to the approval being granted by this Court under Section 27 of the Arbitration and Conciliation Act, 1996 by raising the following objections:

a) No reasons whatsoever has been given by the Arbitrator for permitting the applicants to examine the two witnesses;

b) The witnesses cannot be summoned since they are no longer associated with the respondent/claimant;

c) Ms.S.Pavithra, who was earlier working with the respondent/claimant, has subsequently resigned;

d) The witnesses, who have been examined in the arbitration by any of the parties need not know the contents of the contract.

5. Learned counsel for the applicants would reiterate that since there is no glaring error in the order passed by the Arbitrator, the question of interfering with the same by this Court under Section 27 of the Arbitration and Conciliation Act does not arise. He drew the attention of this Court to the order passed by the Arbitrator for which approval is sought for from this Court under Section 27 of the Arbitration and Conciliation Act.

6. On the other hand, the learned counsel for the respondent/claimant would reiterate the contents of the counter filed before this Court, which have been recorded in the earlier part of this order and would submit that this application is not maintainable. He would also rely upon the following authorities in support of his contentions in the counter filed before this Court:

a) Chunni Lal v. Kishori Lal reported in 1908 L.R. 36 I.A. 9 for the proposition that a litigant cannot cause his opponent to be summoned as a witness;

b) Kaliaperumal v.

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