SMC GLOBAL SECURITIES LTD Vs. PURUSHOTTAM KUMAR KHEMANI

JUDGEMENT

(1.) This is an Appeal under Sec. 37 of the Arbitration and Conciliation Act, 1996 (for short, 'the Act of 1996') challenging the order dtd. 25/1/2018 passed in Misc.(J) Case No.135/2014 whereby the application filed under Sec. 34 of the Act of 1996 was rejected.

(2.) Before proceeding on the facts leading to the filing of the instant Appeal, this Court finds it relevant to take note of that Sec. 34 of the Act of 1996 is a power conferred upon the Court to set aside an arbitral award. It is well settled by various judgments of the Supreme Court that the power under Sec. 34 of the Act of 1996 conferred upon the Court is limited on the grounds specifically enumerated in Sec. 34 of the Act of 1996. The constricted powers under Sec. 34 of the Act of 1996 upon the Civil Court to interfere with an arbitral award is for the reason that when the parties have chosen to avail an alternative mechanism for dispute resolution, they must be left to reconcile themselves to the wisdom of the decision of the Arbitrator and the role of the Court should be restricted to the bare minimum. Interference would be justified only in the cases of commission of misconduct by the Arbitrator which can find manifestation in different forms including exercise of legal perversity by the Arbitrator. It is also well settled by the Supreme Court in its judgment in the case of Dyna Technologies (P) Ltd. vs. Cromton Greaves Limited, reported in (2019) 20 SCC 1 that arbitral award should not be interfered with a causal and cavalier manner, unless the Court comes to a conclusion that the perversity of the award goes to the root of the matter without there being a possibility of alternative interpretation which may sustain the arbitral award. It was observed that an application under Sec. 34 of the Act of 1996 has to be differently approached and cannot be equated with a normal appellate jurisdiction. It was further observed by the Supreme Court in the said decision that the mandate under Sec. 34 of the Act of 1996 is to respect the finality of the arbitral award and the party autonomy to get their dispute adjudicated by an alternative forum as provided under the law. If the courts were to interfere with the arbitral award in the usual course on factual aspects, then the commercial wisdom behind opting for alternate dispute resolution would stand frustrated.

(3.) The Supreme Court further in the case of UHL Power Company Limited vs. State of Himachal Pradesh, reported in (2022) 4 SCC 116 categorically observed that when it comes to the scope of an Appeal under Sec. 37 of the Act of 1996, the jurisdiction of an Appellate Court in examining an order, setting aside or refusing to set aside an award, is all more circumscribed.