Stay updated with key 2024 High Court rulings on Arbitration law. This concise overview highlights recent HCC cases on arbitrability, seat v. venue, limitations, validity of arbitral awards under Section 34, appointment of arbitrators — offering valuable insights into how Indian courts are actively shaping the arbitration landscape.
A. Arbitration — Arbitration and Conciliation Act, 1996 — Ss. 34 and 36 — Arbitrability of case — Eye of the needle test — Evidence to substantiate claim — Evaluation of — Held, on facts, referring parties to tribunal in present case would be against public policy — Petition falls within definition of deadwood — Present case is non-arbitrable and fails to meet conditions to make out a case for referral on application of “eye of the needle” test — Petitioner did not take leave of S. 34 court to get directions seeking fresh adjudication or filed an appeal under S. 37 — Petition dismissed [Jaiprakash Associates Ltd. v. NHPC Ltd., (2025) 1 HCC (Del) 39]
B. Arbitration — Arbitration and Conciliation Act, 1996 — Ss. 20, 2(1)(e) and 42 — Jurisdictional seat of arbitration once fixed under S. 20(2) by arbitrator — When changeable — Held, once jurisdictional “seat” of arbitration is fixed in terms of S. 20(2), then, without express mutual consent of parties to arbitration, “the seat” cannot be changed — Further held, such consent must be express and clearly understood and agreed by parties — Arbitrator misapplied distinction between “seat” and “venue”, as venue does not automatically become seat unless there is clear and documented agreement to that effect — Since no such agreement was found in record, arbitrator’s finding was set aside — Application disposed of [Union of India v. Arsh Constructions, (2024) 5 HCC (Del) 69]
C. Arbitration — Arbitration and Conciliation Act, 1996 — Ss. 34, 37 and 16(5) — Setting aside of arbitral award — Interim award adjudicating claim on merits — Rejection of plea of limitation by interim order prior to rendering of final award on other issues — Held, in terms of S. 34(3) of the Arbitration and Conciliation Act, 1996, award debtor could prefer application to set aside award within three months from date of receipt of award — Delay in filing application to set aside award was beyond period of thirty days — In terms of S. 16(5) of the Arbitration Act, Arbitral Tribunal may admit plea that it does not have jurisdiction even at belated stage, if it considers delay to be justified — Order passed by Tribunal on issue of limitation and concluding that claims were not time-barred, was an award on merits of claim and same could be challenged under S. 34 of the Arbitration Act, 1996 — Appeal allowed [Karam Chand Thapar v. NHPC, (2024) 4 HCC (Del) 231]
D. Arbitration — Arbitration and Conciliation Act, 1996 — Ss. 11(6), 16(1), 10 and 34 — Appointment of Arbitrators — Held, appointment of arbitrator made by Chief Justice of High Court not in accordance with S. 11(6) of the Arbitration Act, 1996 — Appointment to be made only by Supreme Court [Hala Kamel Zabal v. Arya Trading Ltd., (2024) 4 HCC (Del) 399]
E. Arbitration — Arbitration and Conciliation Act, 1996 — S. 34 — Award — Setting aside arbitral award — Examination of arbitral award under S. 34 — Scope of — Partial setting aside of award, whether permitted — Held, award can be set aside on ground of patent illegality if: (a) view taken by Arbitral Tribunal is impossible or such that no reasonable person could arrive at it; (b) if Arbitral Tribunal exceeds its jurisdiction by going beyond contract, and adjudicating upon issues not referred to it; and (c) finding of Arbitral Tribunal is based on no evidence or it ignores material evidence — If two views possible, court will not interfere with view of Arbitral Tribunal if it has taken one of the two views — Reappreciation of evidence impermissible — Award can be set aside on ground of it being in contravention with public policy of India — Court does not function as court of appeal, and errors of fact cannot be corrected — Partial setting aside of arbitral award is valid and justified if the part proposed to be annulled is independent and can be removed without affecting rest of the award [IRCTC Ltd. v. Brandavan Food Products, (2024) 4 HCC (Del) 565]
F. Arbitration — Arbitration and Conciliation Act, 1996 — S. 34 — Setting aside of arbitral award — Recourse to court for — Non-consideration of issues pleaded — Duty to give reasons — Held, findings rendered by Arbitral Tribunal warranted further evaluation bearing in mind indubitable position of S. 65 of Contract Act — Argument of accelerated refund of amounts and penultimate directions framed by Arbitral Tribunal amounting to rewriting of contract neither examined nor conclusions in that respect rendered — Observation of Single Judge erroneous as Arbitral Tribunal failed to assign reasons dealing with these aspects — Judgment must speak and reflect due consideration of challenges — Arguments addressed in challenge to award of refund summarily and abruptly brushed aside — Applicability of S. 65 of the Contract Act neither examined nor evaluated — Challenge to award of refund unanswered by Single Judge — Single Judge erred in dismissing S. 34 of the Arbitration Act, 1996 petitions without according due consideration to challenge raised — Appeal allowed [Ajay Singh v. Kal Airways (P) Ltd., (2024) 3 HCC (Del) 117]
