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Searching Case Laws & Precedent on Legal Query.....!
Analysing the retrieved Case Laws
Scanned Judgements…!
Challenging arbitral interim orders under Article 226 or 227 is generally disallowed unless there are exceptional circumstances. ["Shriram Transport Finance Co. Ltd VS Saneesha M. S. , W/o Vishnudas - Kerala"], ["AKBER SHEREEF M vs HDFC BANK LIMITED - Kerala"]
Analysis and Conclusion:
References:- ["Mahant Subash Shah VS Kulbir Singh - Jammu and Kashmir"]- ["Future Coupons Private Limited VS Amazon. com NV Investment Holdings LLC - Delhi"]- ["Sunflag Iron and Steel Company Ltd. vs Tarini Prasad Mohanty - Orissa"]- ["Sarojkumar Ramchandra Gonjari. VS State Of Maharashtra Through Its Chief Secretary, Mumbai - Bombay"]- ["S.K. Cattle and Poultry Feeds vs Japfa Comfeed India Private Limited - Orissa"]- ["Lifeshine Medical Services Pvt. Ltd VS Alety Jeevan Reddy - Telangana"]- ["Airports Authority Of India VS ite Bite Foods Private Limted - Kerala"]- ["SUNDARAM FINANCE LTD. vs DINESH DAS AND SONS MINES AND STEELS PVT. LTD. - Orissa"]- ["Jindal Steel And Power Ltd. VS Bansal Infra Projects Pvt. Ltd. - Supreme Court"]- ["AKBER SHEREEF M vs HDFC BANK LIMITED - Kerala"]- ["EASY TRIP PLANNERS LTD Vs ONE97 COMMUNICATIONS LTD - Delhi"]- ["S.Madhan vs A.Venkateshwaran - Madras"]- ["M.I. MOHAMMED VS M/s. HLL LIFE CARE LTD. - Kerala"]- ["Easy Trip Planners Ltd. vs One97 Communications Ltd. - Delhi"]- ["AKBER SHEREEF M vs HDFC BANK LIMITED - Kerala"]
In the realm of commercial dispute resolution, arbitration has emerged as a preferred mechanism for speedy and efficient justice. However, parties often grapple with interim orders issued by arbitral tribunals during ongoing proceedings. A common query arises: can an interim order passed by an Arbitral Tribunal be challenged under Article 227 of the Constitution? This question strikes at the balance between minimal judicial interference and the need for oversight in arbitration.
This blog post delves into the legal landscape, drawing from Supreme Court precedents and statutory provisions under the Arbitration and Conciliation Act, 1996 (the 'Arbitration Act'). We'll examine the general rule, exceptions, and practical recommendations, ensuring you understand when constitutional remedies apply—or don't.
The Arbitration Act is designed as a self-contained code to minimize court intervention, promoting the autonomy of arbitral tribunals. Section 5 explicitly states that no judicial authority shall intervene except where so provided in this Part Deep Industries Limited VS Oil And Natural Gas Corporation Limited - 2019 0 Supreme(SC) 2277. Interim orders, such as those under Sections 16 (jurisdiction) or 17 (interim measures), are typically challengeable through statutory channels like appeals under Section 37, rather than constitutional writs under Articles 226 or 227.
The Supreme Court has firmly established that High Courts should not entertain challenges to interlocutory arbitral orders under Article 227 as a matter of routine. In SBP & Co. vs. Patel Engineering Ltd. (2005), the Court disapproved of High Courts proceeding 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 International Coil Ltd. VS DLF Cyber City Developers Ltd. - 2019 0 Supreme(P&H) 1199Trading Engineers International Ltd. Thru. Agent Mahipal Singh VS U. P. Power Transmission Corp. Ltd. - 2022 Supreme(All) 1107. This stance underscores the Act's goal of expeditious resolution without derailing proceedings through writ petitions Odisha State Road Transport Corporation VS ARSS Bus Terminal Pvt. Ltd. - 2021 0 Supreme(Ori) 37.
The landmark ruling in SBP & Co. clarified that once arbitration commences, High Courts must refrain from interfering with tribunal orders unless exceptional circumstances exist. The Court observed: 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. Section 37 makes certain orders of the Arbitrator appealable under Sec.... International Coil Ltd. VS DLF Cyber City Developers Ltd. - 2019 0 Supreme(P&H) 1199Mecon Ltd. VS Jharkhand Micro and Small Enterprises Facilitation Council through the Under Secretary-cum-Member Secretary - 2022 Supreme(Jhk) 638. This decision emphasized that Section 37 provides the primary appellate remedy for specified interlocutory orders Odisha State Road Transport Corporation VS ARSS Bus Terminal Pvt. Ltd. - 2021 0 Supreme(Ori) 37.
Subsequent judgments have echoed this restraint. In AIR 2006 SC 450, the Supreme Court reaffirmed that challenges under Articles 226/227 are permissible only in exceptional cases like patent lack of jurisdiction or bad faith Odisha State Road Transport Corporation VS ARSS Bus Terminal Pvt. Ltd. - 2021 0 Supreme(Ori) 37. Similarly, AIR 1997 SC 1125 highlighted Article 227's supervisory nature, to be exercised sparingly against jurisdictional excesses State of Madhya Pradesh VS Visan Kumar Shiv Charan Lal - 2008 0 Supreme(SC) 1809.
High Courts have applied these principles consistently. For instance, in a case involving counterclaims during an insolvency moratorium under the Insolvency and Bankruptcy Code, the High Court upheld the tribunal's order, noting: High Court exercises supervisory jurisdiction over arbitral proceedings but should refrain from excessive interference; intervention is appropriate only in exceptional circumstances where the tribunal exceeds its jurisdiction Trading Engineers International Ltd. Thru. Agent Mahipal Singh VS U. P. Power Transmission Corp. Ltd. - 2022 Supreme(All) 1107. The petition was dismissed, reinforcing minimal interference.
While the norm is non-interference, Article 227's constitutional supervisory power cannot be wholly ousted. Challenges may succeed in rare scenarios:
In AIR 2006 SC 450, the Court specified exceptions like patent lack of jurisdiction or bad faith Odisha State Road Transport Corporation VS ARSS Bus Terminal Pvt. Ltd. - 2021 0 Supreme(Ori) 37. Other cases, such as those under the MSME Act, dismissed writs where alternative remedies under Section 34 existed, but noted jurisdictional flaws could justify review Mecon Ltd. VS Jharkhand Micro and Small Enterprises Facilitation Council through the Under Secretary-cum-Member Secretary - 2022 Supreme(Jhk) 638.
However, procedural irregularities or mere errors of fact do not suffice. As seen in NHAI-related arbitration challenges, courts direct parties to Section 34 remedies instead of entertaining writs under Article 226/227 Chandra Shekhar Pandey, Male Son of Ramkrit Pandey VS Union of India - 2022 Supreme(Pat) 131.
Article 227's application extends beyond pure arbitration to quasi-judicial bodies. In EPF proceedings, courts have dismissed premature writs against interlocutory orders, urging exhaustion of statutory processes Sahara India Thru. Partner Om Prakash Srivastava VS U. O. I. Thru Secy. Ministry Of Labour, New Delhi - 2020 Supreme(All) 921. Similarly, in NCLT matters, challenges to interim orders were routed to specific rules like NCLT Rule 49(2), with Article 227 reserved for void orders Sulochana Gupta W/o Radha Ballabh Gupta VS RBG Enterprises Pvt. Ltd. Rep. by its Director Rajkumar Gupta - 2020 Supreme(Ker) 640.
These cases illustrate a broader principle: writ jurisdiction is not an appellate tool but a supervisory one, exercised sparingly to prevent abuse State of Madhya Pradesh VS Visan Kumar Shiv Charan Lal - 2008 0 Supreme(SC) 1809.
To navigate this terrain effectively:
Parties must weigh the risk of prolonging disputes against arbitration's efficiency.
Generally, an interim order by an arbitral tribunal cannot be challenged under Article 227 except in exceptional circumstances like patent lack of jurisdiction or bad faith. The Supreme Court prioritizes the Arbitration Act's framework to ensure swift justice International Coil Ltd. VS DLF Cyber City Developers Ltd. - 2019 0 Supreme(P&H) 1199.
Key Takeaways:- Statutory appeals under Section 37 are the go-to remedy.- Article 227 is supervisory, not appellate—use sparingly.- Exceptions demand strong proof of jurisdictional flaws.
This post provides general information based on judicial precedents and is not legal advice. Consult a qualified lawyer for case-specific guidance.
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. We see no warrant for such an approach. a href="./.. ... 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....
arbitral order only where, but for Article 227, the aggrieved litigant is remediless. ... 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. ... does not terminate the arbitration or bring it to an end, cannot ....
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. We see no warrant for such an approach. SBP & CO (supra) and held that though each and every order passed by the arbitral tribunal is not susceptible to be assailed before the High Court under Ar....
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. ... However, it is one thing to say that in exercise of the power vested in it Under Article 226 of the Constitution, the High Court can entertain a writ petition against any order#HL_E....
No order as to costs. 40. Interim order, if any, passed earlier stands vacated. ... The High Court reiterated that if orders passed by arbitral tribunals were routinely challenged and overturned under Article 227, it would nullify the entire purpose of a separate arbitration regime and revert the process to the very judicial delays it sought to eliminate. ... If High Courts were to routinely entertain petitions under Art....
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. We see no warrant for such an approach. ... However, the same does not define the factors of an interim award. 17. In the case on hand, the order under challenge is an interlocutory order passed#HL_....
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. We see no warrant for such an approach. ... 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 c....
In the instant case, Respondent No. 1 has not been able to show exceptional circumstance or ‘bad faith’ on the part of the Appellant, to invoke the remedy under Article 227 of the Constitution. ... This being the case, there is no doubt whatsoever that if petitions were to be filed under Articles 226/227 of the Constitution against orders passed in appeals under Section 37, the entire arbitral process would be derailed and would not come to fruition for many years. ......
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 Article 227 of the Constitution. We see no warrant for such an approach. ... We, therefore, disapprove of the stand adopted by some of the High Courts that any order passed by the Arbitral Tribunal is capable of bei....
(f) Whether a party can be permitted to initiate parallel proceedings by approaching the High Court under Article 227 of the Constitution, while simultaneously invoking arbitration, thereby causing delay in the arbitral process? ... However, the Writ Court, exercising its jurisdiction under Article 227 of the Constitution, granted interim protection in favour of Respondent No. 1 against the invocation of the bank guarantee until the disposal of the ....
The Supreme Court referred to the judgment rendered by the larger bench of seven judges in SBP and Company (Supra), where the Court was considering interference with an order passed by an Arbitral Tribunal by the High Court under Article 226/227 and had observed in paragraph 45 and 46 as follows:“ “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. Section 37 makes certain orders of the Arbitrator appealable under Sec....
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. Section 37 makes certain orders of the Arbitral Tribunal appealable.
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. Section 37 makes certain orders of the Arbitral Tribunal appealable. Section 37 makes certain orders of the Arbitral Tribunal appealable. 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.
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. Section 37 makes certain orders of the arbitral tribunal appealable.
Such an order can be challenged only under Article 227 of the Constitution. Placing reliance on the decision of the Hon’ble Supreme Court in T.C. Basappa vs. T. Nagappa, AIR 1954 SC 440 and Radhey Shyam and Ors. v. Chhabi Nath and Ors. (2015) 5 SCC 423, learned counsel for the appellants further submitted that a challenge to an order of the National Company Law Tribunal does not fall under the scope of Article 226 of the Constitution of India.
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