J&K High Court: Exercise of Writ Jurisdiction Against Arbitral Orders Only in Exceptional Cases

The High Court of Jammu & Kashmir and Ladakh has firmly reiterated that its writ jurisdiction under Articles 226 and 227 of the Constitution should be exercised with exceptional restraint when it comes to interlocutory orders passed by an arbitrator during ongoing proceedings. The single bench of Justice Sanjay Parihar dismissed a petition filed by Tata Power Renewable Energy Limited challenging an arbitrator's decision to constitute a Technical Committee for inspection of solar power project sites.

The Dispute at Core

The dispute arises from a contract awarded to Tata Power by the State Procurement and Supplies Agency (SPSA) for the supply, installation, testing, and commissioning of Off-Grid Solar PV Power Plants across 1,013 project sites in 20 districts of the Union Territory. The company claimed it completed all installations, which were verified and certified by the Jammu and Kashmir Energy Development Agency (JAKEDA). According to Tata Power, outstanding dues of approximately Rs. 38.66 crore remained unpaid, leading it to terminate the contract on June 8, 2023.

When the matter was referred to arbitration, SPSA filed an application under Section 26 of the Arbitration and Conciliation Act, 1996, seeking appointment of an expert committee for physical verification of the sites. The arbitrator initially rejected this request on December 23, 2025, while expressly preserving the power to appoint an expert later if necessary.

The Renewed Application and Challenge

In March 2026, SPSA filed a renewed application, relying on fresh field-verification material from four districts and a communication from Junior Assistant Fayaz Ahmad Bhat, who allegedly disassociated himself from the earlier verification exercise in Kashmir. The arbitrator allowed the application and constituted the committee on March 28, 2026.

Tata Power challenged this order before the High Court, arguing that it violated the earlier order, introduced a new factual defence after the closure of evidence, and that an inspection conducted in 2026 could not fairly determine the condition of installations that existed during 2021-2023. The company also contended that SPSA's own communication dated October 5, 2024, acknowledged completion of the project, making the renewed request an instance of approbation and reprobation.

The Legal Framework: Minimal Intervention

Justice Parihar examined the settled legal position on judicial interference with arbitral proceedings, citing key Supreme Court precedents including SBP & Co. v. Patel Engineering Ltd. , Deep Industries Limited v. ONGC , and Manish Kamal Bezboruah v. Bokahola Tea Company Private Limited . The court observed that while constitutional jurisdiction under Articles 226 and 227 survives, its exercise against interlocutory orders is governed by exceptional restraint.

"The Court is therefore not required, at an intermediate stage of arbitration, to examine the correctness of the arbitrator's procedural determination as though exercising appellate jurisdiction ."

The court noted that the arbitrator's earlier order expressly preserved the power to appoint an expert upon a renewed request if circumstances warranted it. The respondents' reliance on fresh material, including the communication from Mr. Bhat and field reports, provided a basis for the arbitrator to reconsider the matter. Whether that material was credible or admissible were questions for the arbitrator to decide, not for the High Court under writ jurisdiction.

Addressing Key Concerns

On the question of temporal relevance, the court acknowledged the evidentiary difficulty but clarified that it did not undermine the arbitrator's jurisdiction.

"A physical condition found in 2026 cannot automatically be treated as proof of the condition prevailing in 2023. The causal and temporal connection , if any, between the Committee's observations and the petitioner's contractual performance would have to be independently established and evaluated by the Arbitrator after hearing both sides."

The court further held that constituting the committee did not amount to an adjudication that the installations were defective. The eventual report would remain material before the arbitrator and would not itself determine rights and liabilities. Tata Power would have a full opportunity to challenge the report's methodology, relevance, and conclusions.

Decision and Directions

Finding no patent lack of jurisdiction or manifest perversity, the High Court dismissed the writ petition. However, it issued important directions to safeguard the petitioner's interests:

  1. The expert committee's report shall not be acted upon adversely without affording the affected party a reasonable opportunity to object to its contents and lead rebuttal evidence.
  2. The physical condition found in 2026 shall not, by itself, be treated as determinative of the condition at the time of installation or termination of the contract.
  3. The arbitrator is requested to conclude proceedings expeditiously while ensuring adequate hearing to both sides.

The judgment reinforces the legislative policy of minimal judicial intervention in arbitration and clarifies that procedural orders of arbitrators, even if debatable, will not be interfered with at an interlocutory stage unless they suffer from a fundamental jurisdictional flaw.