An appellate court under Section 37 of the Arbitration and Conciliation Act, 1996, lacks the jurisdiction to reappraise evidence or set aside an arbitral award merely because it prefers an alternative view, absent a showing of patent illegality, perversity, or fundamental policy violations.

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ASHWANI KUMAR MISHRA, J.

This appeal is filed under Section 37 of the Arbitration and Conciliation Act, 1996 (for short, the Act’), assailing the order passed by the Additional District Judge, Ludhiana, dated 01.10.2024, in proceedings under Section 34 of the Act.

2. By the order impugned, learned Additional District Judge, Ludhiana, has rejected the appellant’s objections under Section 34 of the Act and has thereby affirmed the award of the Arbitral Tribunal dated 16.01.2021. It transpires that M/s. Munshi Ram Hosiery, Gurbax Colony, Ludhiana – respondent no.1 had obtained a Policy from the appellant for its premises/stock/ material, etc. vide Policy No. 361102111701000101. This policy was Standard Fire & Special Perils Policy and was applicable from 01.08.2017 to 31.07.2018.

3. On 15.10.2017, a fire broke out in the premises of the insured respondent no.1. A claim for losses caused in the incident was lodged by the insured with the company. A surveyor was appointed by the Insurance Company for assessment of loss. Mr. B. S. Chawla was appointed as the Surveyor. He submitted his report acknowledging the factum of fire in the premises of the insured and assessed the loss to the tune of ` 1,32,68,000/- . This amount was received under protest by the insured, who instituted arbitration proceedings by submitting additional claim to the tune of ` 3,63,03,387/-. Undisputedly, there existed an arbitral clause in the insurance policy, which was invoked by the insured. The claim was ultimately referred to the Arbitral Tribunal presided over by Justice H. S. Bhalla (Retd.) with Dr. Jaswant Singh and Mr. Deepak Malhotra as co-arbitrators. The Arbitral Tribunal has gone into the facts of the case and framed nine issues for its consideration. Ultimately, the award has been made by the Arbitral Tribunal on 16.01.2021 holding the insured entitled to additional sum of ` 2,28,82,977/- along with interest @ 9% per annum with effect from 17.11.2018 till the date of payment of the awarded amount and in addition the Arbitral cost of ` 20 lacs. The award was not unanimous. The Presiding Arbitrator as well as Dr. Jaswant Singh have recorded the reasons, while the co-arbitrator Mr. Deepak Malhotra has decided to give a dissenting note/ award, which was passed subsequently on 21.02.2021.

4. Aggrieved by the award of the Arbitral Tribunal, the Insurance Company has filed objection before the Additional District Judge under Section 34 of the Act. This objection has been rejected by the concerned Court. Thus aggrieved, the Insurance Company is before us in the present appeal.

5. At the outset, we may note that when the FAO was filed, an objection was taken on behalf of the appellant that subject matter of dispute fell within the ambit of commercial disputes under Section 2(c) of the Commercial Courts Act, 2015, but it has been decided not by the Commercial Court but by the Civil Court. Taking cognizance of such contention, learned Single Judge invited report from the learned District & Sessions Judge, Ludhiana, as to whether the Court of Mr. Jagdeep Sood, Additional District Judge, Ludhiana, was nominated as Commercial Court ?

6. A report has been received from the District Judge, Ludhiana, dated 05.04.2025, as per which the learned 5th ADJ, Ludhiana, Shri Jagdeep Sood’s Court was a nominated Commercial Court. Consequently, the matter has been placed before the Commercial Appellate Bench of this Court.

7. The appellant Insurance Company contends that Additional District Judge, Ludhiana