The court can set aside an arbitral award under Section 34 if it violates substantive law, contract terms, or public policy, especially when procedural requirements aren't met or if the award is patently illegal.

1 Before dealing with the issues involved in this appeal, we would first decide the main point in controversy, namely--the ambit and scope of Court's jurisdiction in case where award passed by the Arbitral Tribunal is challenged under S.34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as "the Act") as the decision in this appeal would depend upon the said finding. In other words -- whether the Court would have jurisdiction under S.34 of the Act to set aside an award passed by the Arbitral Tribunal which is patently illegal or in contravention of the provisions of the Act or any other substantive law governing the parties or is against the terms of the contract?

2 Learned senior counsel Mr. Ashok Desai appearing for the appellant submitted that in case where there is clear violation of S.28 to 31 of the Act or the terms of the Contract between the parties, the said award can be and is required to be set aside by the Court while exercising jurisdiction under S.34 of the Act.

3 Mr. Dushyant Dave, learned senior counsel appearing on behalf of respondent - company submitted to the contrary and contended that the Court's jurisdiction under S.34 is limited and the award could be set aside mainly on the ground that the same is in conflict with the 'Public Policy of India'. According to his submission, the phrase 'Public Policy of India' cannot be interpreted to mean that in case of violation of some provisions of law, the Court can set aside the award.

4 For deciding this controversy, we would refer to the relevant part of S.34 which reads as under:--
"34. Application for setting aside arbitral award-- (1) Recourse to a court against an arbitral award may be made only by an application for setting aside such award in accordance with Sub-section (2) and Sub-s.(3).
(2) An arbitral award may be set aside by the court only if--
(a) the party making the application furnishes proof that -
(i) a party was under some incapacity, or
(ii) the arbitration agreement is not valid under the law to which the parties have subjected it or, failing any indication thereon, under the law for the time being in force; or
(iii) the party making the application was not given proper notice of the appointment of an arbitrator or of the arbitral or was otherwise unable to present his case; or
(iv) the arbitral award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration;
Provided that, if the decisions on matters submitted to arbitration can be separated from those not so submitted, only that part of the arbitral award which contains decisions on matters not submitted to arbitration may be set aside; or
(v) the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties, unless such agreement was in conflict with a provision of this Part from which the parties cannot derogate or, failing such agreement, was not in accordance with this Part; or
(b) the court finds that--
(i) the subject matter of the dispute is not capable of settlement by arbitration under the law for the time being in force of
(ii) the arbitral award is in conflict with the public policy of India.
Explanation -- Without prejudice to the generality of Sub clause (ii), it is hereby declared, for the avoidance of any doubt, that an award is in conflict with the public policy of India if the making of the award was induced or affected by fraud of corruption or was in violation of S.75 or S.81."

5 For our purpose, it is not necessary to refer to the scope of self explanatory Clauses (i) to (iv) of Sub-section (2)(a) of S.34 of the Act and it does not require elaborate discussion. However, Clause (v) of Sub-S.2(a) and Clause (ii) of Sub-S.2(b) require consideration. For proper adjudication of the question of jurisdiction, we shall first consider what meaning could be assigned to the term "Arbit