Whether court exercises appellate nor supervisory in application filed U/S 34 of Arbitration Act?

It is mercifully unnecessary to repeat and quote the profusion of judicial authority on the issue that Section 34 jurisdiction is neither appellate nor supervisory; it is to ensure that awards are expressions of decisions of

agreed private judges, are broadly in conformity with law and are not preceded by an approach that betrays unreasonableness in procedure or outcome of the kind that would shock a court of law, or disclose patently erroneous understanding of law: [Ref Saw Pipes (supra) and Mc Dermott International Inc. v. Burn Standard Co. Ltd., (2006) 11 SCC 181]. The decision in Associate Builders v Delhi Development Authority [2015 (3) SCC 49] cautioned courts from intervening with findings in Arbitral Tribunal awards, on public policy grounds unless there was a patent error of law or a manifestly unreasonable finding (which have now become precepts for the approach under Section 34) thus: “33. It must clearly be understood that when a court is applying the "public policy" test to an arbitration award, it does not act as a court of appeal and consequently errors of fact cannot be corrected. A possible view by the arbitrator on facts has necessarily to pass muster as the arbitrator is the ultimate master of the quantity and quality of evidence to be relied upon when he delivers his Arbitral Tribunal award. Thus an award based on little evidence or on evidence which does not measure up in quality to a trained legal mind would not be held to be invalid on this score. Once it is found that the arbitrators approach is not arbitrary or capricious, then he is the last word on facts.”

19. The second facet which Courts must be conscious of is that if the arbitrator commits an error in contract interpretation, that is an error within her jurisdiction (Ref MSK Projects (I) (JV) Ltd v State of Rajasthan and Anr. 2011 (10) SCC 53; G. Ramachandra Reddy v Union of India and Anr. 2009 (6) SCC 414; McDermott International Inc. v. Burn Standard Co. Ltd. and Ors., (2006) 11 SCC 181 and Renusagar Power Co. Ltd. v. General Electric Co. and Anr. 1984 (4) SCC 679). In McDermott International (supra), the

Supreme Court clarified the Court’s inherent limitation by reason of Section 34 in such matters:

“112. It is trite that the terms of the contract can be express or implied. The conduct of the parties would also be a relevant factor in the matter of construction of a contract. The construction of the contract agreement is within the jurisdiction of the arbitrators having regard to the wide nature, scope and ambit of the arbitration agreement and they cannot be said to have misdirected themselves in passing the award by taking into consideration the conduct of the parties. It is also trite that correspondences exchanged by the parties are required to be taken into consideration for the purpose of construction of a contract. Interpretation of a contract is a matter for the arbitrator to determine, even if it gives rise to determination of a question of law. (See Pure Helium India (P) Ltd. v. ONGC [(2003) 8 SCC 593] and D.D. Sharma v. Union of India [(2004) 5 SCC 325]). 113. Once, thus, it is held that the arbitrator had the jurisdiction, no further question shall be raised and the court will not exercise its jurisdiction unless it is found that there exists any bar on the face of the award.” 20. Likewise, in Steel Authority of India v. Gupta Brothers 2009 (10) SCC 63, the Court held that Section 34 would be attracted in cases where an arbitrator “travels beyond the contract”, or makes an award “contrary to the terms of the contract”. Section 34, however, the Court stated, cannot be used to set aside awards in which there was an “error relatable to interpretation of the contract”, or if it was based on a “possible view of the matter”, or if it was based on a finding of law in a case where a “specific question of law [had been] submitted to the arbitrator.” In short, it is not the courts’ primary responsibility to examine the award as though they were sitting in appeal over it.

 IN THE HIGH COURT OF DELHI AT NEW DELHI

Decided on: 16.10.2018

 FAO (OS) 458/2012

POWER GRID CORPORATION OF INDIA  Vs L.S. CABLE 

CORAM:

HON'BLE MR. JUSTICE S. RAVINDRA BHAT

HON'BLE MR. JUSTICE A.K. CHAWLA

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Whether District Judge exercises appellate jurisdiction over award of arbitral tribunal?

The Hon'ble Supreme Court in the case of J.G. Engineers Private Limited Vs. Union of India and Another, MANU/SC/0527/2011 : (2011) 5 SCC 758 has held that the District Judge, exercising powers under Section 34 of the Act, exercises supervisory and not appellate jurisdiction, over the award of the Arbitral Tribunal.

IN THE HIGH COURT OF BOMBAY AT GOA

Appeal Under Arbitration Act No. 8 of 2016

Decided On: 10.04.2018

Titagarh Wagons Limited Vs. Chowgule and Company Private Limited

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Whether new case or new defence can be raised before court if it was not raised before arbitrator?

The Supreme Court in the case of MSK Projects (I) (JV) Ltd. (supra) has held that a new case or a defence not raised before the Arbitrator, cannot be considered by the Court under Section 34 or Section 37 of the Act. In that case, a claim was made by a concessionaire, under the toll agreement. It was contended that the concessionaire had suffered loss on account of delay in issuance and implementation of notification by the State, barring the use of the old route. The award of the Arbitrator was set aside by the Courts, on the ground that there was no clause in the agreement for State to issue such a notification. The Supreme Court held that the award could not have been set aside, as such a plea about absence of a clause in the agreement, was not raised before the Arbitrator.

IN THE HIGH COURT OF BOMBAY AT GOA

Appeal Under Arbitration Act No. 8 of 2016

Decided On: 10.04.2018

Titagarh Wagons Limited Vs. Chowgule and Company Private Limited

Hon'ble Judges/Coram:

C.V. Bhadang, J.

Citation: 2018(4) MHLJ 638

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Whether Division Bench has supervisory Jurisdiction over Single Bench of High Court?

A careful reading of Article 227 of the Patna High Court 
Constitution of India clearly shows that Article 227 vests, in
the High Courts, the power of superintendence. However, while
Section 107 of the Government of India Act vested, in the High
Courts, the power of superintendence over all the “Courts‟
subject to its appellate jurisdiction, Article 227 of the
Constitution of India has vested, in the High Courts, the power
of superintendence not only over the „Courts’, which are
subject to its territorial jurisdiction, but also over all the
„Tribunals’ in relation to which the High Court exercises
territorial jurisdiction.
 A single Bench of High Court does not fall
within the expressions „courts’ and „tribunals throughout the
territories interrelation to which a High Court exercises its
jurisdiction‟. This apart, Clause (2) of Article 227 of the
Constitution of India empowers a High Court to (a) call for
returns from such courts; (b) make and issue general rules
and prescribe forms for regulating the practice and
proceedings of such courts; and (c) prescribe forms in which
books, entries and accounts shall be kept by the officers of any
such courts.
 Obviously, all the powers, which are given to
the High Court under sub-Clauses (a), (b) and (c) of Clause 2
of Article 227, are in respect of courts and tribunals, which are
subordinate to the territorial jurisdiction of a High Court. A Patna High Court 
single Judge or a single Bench of a High Court is not a court
subordinate to the Division Bench of the High Court and,
therefore, the power of superintendence, which is vested in a
High Court by Article 227, is not exercisable against order or
decision of its own single Bench.
IN THE HIGH COURT OF JUDICATURE AT PATNA
Civil Writ Jurisdiction Case No.718 of 2016

ANIL KUMAR SHRIVASTAVA, 
VERSUS
 SHAURYA SUNIL, 
CORAM: HONOURABLE THE ACTING CHIEF JUSTICE
AND
HONOURABLE MR. JUSTICE CHAKRADHARI SHARAN
SINGH

Date: 20-01-2016

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