ARBITRAL AWARD

(Project Report)

Submitted to
Mr. SANDEEP SUMAN
Faculty Member in Alternative dispute resolution

Submitted by
SURBHI BAIS
B. A. LL. B. (Hons.) Student
Semester – VI , Section – C, Roll No. 175

Hidayatullah National Law University

Uparwara Post, Abhanpur, New Raipur – 493661 (C.G.)

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 DECLARATION
This is to certify that the Project work done atHidayatullah National Law University, Raipur
Chhattisgarh by Ms.SURBHI BAIS, Roll no.175 has been found satisfactory. It has not been
submitted for any other examination and does not form a part of any other course undergone by
the candidate. It is further certified that she has made the project with all her sincerity and is
found authentic and not copied from any other project submitted earlier.

SURBHI BAIS

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 ACKNOWLEDGEMENTS
First and foremost I would like to thank our course teacher Mr. Sandeep Suman, Faculty,
Alternate Dispute Resolution, HNLU, for allotting me this topic to work on and whose help and
assistance enabled me to move ahead with this topic.
I would like to thank my friends, who gave me their precious time for guidance and helped me a
lot in completing my project by giving their helpful suggestion and assistance. I would like to
thanks my seniors for their valuable support. Last, but not the least I thank the University
Administration for equipping the University with such good library and I.T. facilities, without
which, no doubt this work would not have taken this shape in correct time .

SURBHI BAIS
SEM VI
ROLL NO.175

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CONTENTS

Declaration…………………………………………………………………2

Acknowledgements………………………………………………………...3

Chapter 1:-Introduction…………………………………………………….5

 Objective …………………………………………………………..…6
 Research Methodology…………………………………………..…..6

Chapter 2:- Making of arbitral award and terminations of proceeding….7

 Types of awards……………………………………………………..8
 Forms of the awards…………………………………………………9
 Substantive requirements…………………………………………….10

Chapter 3:- Recourse against arbitral award ……………………………...12

Chapter 4:-Finality & Enforcement of award ………………………………16

Conclusion…………………………………………………………………....20

Bibliography…………………………………………………………….…….21

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 CHAPTER 1-INTRODUCTION

An arbitration award (or arbitral award) is a determination on the merits by an arbitration

tribunal in an arbitration, and is analogous to a judgment in a court of law. It is referred to as an
'award' even where all of the claimant's claims fail (and thus no money needs to be paid by either
party), or the award is of a non-monetary nature.

An arbitral award or arbitration award refers to a decision made by an arbitration tribunal in an

arbitration proceeding. An arbitral award is analogous to a judgment in a court of law. An
arbitral award can be of a non-monetary nature where the entire claimant's claims fail and no
money needs to be paid by either party.

An arbitration award can be made for payment of a sum of money, declaration upon any matter
to be determined in the arbitration proceedings, injunctive relief, specific performance of a
contract and for rectification, setting aside or cancellation of a deed or other document.

The following is an example of a state statute (California) defining Arbitral Award :

The term arbitral award is defined under Cal Code Civ Proc § 1297.21 (a) as any decision of the
arbitral tribunal on the substance of the dispute submitted to it and includes an interim,
interlocutory, or partial arbitral award. The arbitral tribunal may, at any time during the arbitral
proceedings, make an interim arbitral award on any matter with respect to which it may make a
final arbitral award. The interim award may be enforced in the same manner as a final arbitral
award [Cal Code Civ Proc § 1297.316]. Unless otherwise agreed by the parties, a party may
request, within 30 days after receipt of the arbitral award, the arbitral tribunal to make an
additional arbitral award as to the claims presented in the arbitral proceedings but omitted from
the arbitral award [Cal Code Civ Proc § 1297.334].

Pursuant to USCS Foreign Arb Awards Article 1, the term arbitral awards shall include not only
awards made by arbitrators appointed for each case but also those made by permanent arbitral
bodies to which the parties have submitted

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 OBJECTIVES
1. To study the making of arbitral award and termination of proceedings;
2. To examine the recourse against arbitral award.
3. To analyse the finality of arbitral award.

RESEARCH METHODOLOGY
Nature of research work: This project “Arbitral Award” is a “Doctrinal” work. Doctrinal research
includes studying books and established literature and not actually going to the field and doing
empirical research.
Source of research work: The sources of this project are both primary (bare acts, statutes, etc)
and secondary sources (books given by different authors, journals, internet, etc).

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CHAPTER 2 : MAKING OF ARBITRAL AWARD AND
TERMINATION OF PROCEEDINGS
After the arbitrator has closed the proceedings at the reference he must prepare his award which
embodies his decision. He must decide on the issues canvassed before him. He has contracted so
to do and he does this in his award. The word “award” is defined in the Arbitration Act 2005 as
“a decision of the arbitral tribunal on the substance of the dispute and includes any final, interim
or partial award and any award on costs or interest but does not include interlocutory orders”. (A
copy of the Arbitration Act 2005 may be downloaded from www.malaysianbar.org.my and this
Act will be referred to hereinafter as “the Act”).
The court in Jeuro Development Sdn Bhd v Teo Teck Huat (M) Sdn Bhd [1998] 6 M.L.J. 545 at
p. 551 defined an award per Blocks Law Dictionary (1990, 6th ed., West Publication Co.) as:
“The decision or determination rendered by arbitrators or commissioners, or other private or
extra-judicial deciders, upon a controversy submitted to them; also the writing or document
embodying such decision”. The Arbitration Award - 1 - Thus, an award is a decision/judgment
made by an arbitrator on a controversy or a dispute submitted to him. It informs the parties of his
decision, and the reasons for it. In order that an award is enforceable under s.38 of the Act, it
must be in conformity with the Act, legal principles and that of fairness (i.e. natural justice or
due process).
The court in David Taylor and Son Ltd v Barnett Trading Co [1953] 1 W.L.R. 562 at p. 568
stated the general rule as: “The duty of an arbitrator is to decide the questions submitted to him
according to the legal rights of the parties, and not according to what he may consider fair and
reasonable under all the circumstances”. The decision must be one that decides on all the issues
involved in the controversy. The award is the final product of a great deal of work both by the
arbitrator and by the parties and their teams (which may comprise lawyers, technical experts,
etc). The arbitrator is under a duty to proceed with due diligence and reasonable dispatch in
making his award. Under s.34 of the Act, the arbitral proceedings shall be terminated by a final
award or by an order of the arbitrator. Unless there is an express intention in the arbitration
agreement, the Act does not impose any time limit on the arbitrator to make his award. An
arbitrator who fails to use all reasonable dispatch in entering on and proceeding with the
reference and making an award may be removed by the court: see s.16 of the Act. Under s.46 of

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the Act where the time for making an award is limited by the arbitration agreement, the court
may, unless otherwise agreed by the parties, extend that time.
TYPES OF AWARDS
There are different types of award by reference to the Act: The Arbitration Award - 2 –
1) INTERIM AWARD Section 2 of the Act and Article 32(1) of the IEM Arbitration Rules
2003 (hereinafter referred to as “the IEM Rules”) provide for interim awards. They are often
used: (a) where disputes can conveniently be divided into stages;
(b) where the determination of preliminary issues may save the time and cost of a prolonged
reference;
(c) where the arbitrator’s award of costs is dealt with separately from the substantive issues.
An example where an interim award may be suitable arises when there is a question whether or
not a claim is time-barred under the Limitation Act 1953. If the claim is time-barred then there is
no need to proceed further. Similarly, an interim award may obviate the need for a further pursuit
of the claim if a dispute as to the validity in principle of a claim may often be dealt with as a
preliminary issue. While the interim award does not determine all the matters in dispute between
the parties but all the matters referred to in an interim award are determined finally therein. The
word “interim” does not imply that those matters decided in the interim award are subject to
review. For example, an interim award where liability is decided in respect of certain items of the
claim but not other items provided a final determination of those issues of liability. Only
quantum issues on those items are to be decided in another award.
2) PERFORMANCE AWARD- While it is usual for the arbitrator to make his award in
monetary terms, he may order specific performance. A party can be ordered to perform certain
specified works, or hand over goods or rights, other than the The Arbitration Award - 3 - matters
related to land or to any interest in land. For example, a contractor may be required to carry out
remedial works in the building to ensure uniformity of the finished work and/or to ensure no
question arises as to responsibility for future defects. However, the arbitrator should not make a
performance award where a monetary award would resolve the dispute in a satisfactory way. The
danger being the manner the work is performed under an order for specific performance may
lead to a further dispute.
3) FINAL AWARD Section 36 of the Act provides that unless otherwise stated, an award is
deemed to be final and binding on the parties, and it concludes the reference. As soon as the

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arbitrator has completed and published his award then his work as an arbitrator and his power
and duty cease. He becomes functus officio, meaning that he has discharged his duty: see Lloyd
& Others v Wright and Dawson v Wright [1983] Q.B. 1065. It follows that thereafter he has no
jurisdiction to deal with any question or difficulty that may arise from his award. There are some
exceptions to this: (1) where the award is merely an interim award and the arbitrator will have to
deal with other matters left to a final award. (2) where the award is remitted to the arbitrator by
the court for reconsideration under s.37(6) and s.42(4c) of the Act or when a party refers the
award to the court on a question of law, the court may order the arbitrator to state the reasons for
its award under s.42(3) of the Act. (3) Where the arbitrator corrects in an award “any clerical
mistake or error arising from any accidental slip or omission” under s.35 of the Act. The
Arbitration Award
4) CONSENT AWARD The consent award under s.32 of the Act incorporates terms of a
settlement which the parties have negotiated before it reaches a hearing or an award. The purpose
of so doing is to define clearly the matters that have been so settled and to define responsibility
for costs. It then enables one party to take enforcement proceedings when the other party fails to
comply with the terms of the settlement. The consent award formally brings the arbitration to a
conclusion and per s.32(3) of the Act it shall have the same status and effect as an award on the
merits of the case. On the consent award, Article 34(1) of the IEM Rules calls it “an arbitral
award on agreed terms” and states that “the arbitral tribunal is not obliged to give reasons for
such an award.”
FORM OF THE AWARD
Before the award can be drafted, the arbitrator has to decide upon what the important issues in
the reference are. He will make his decisions with care, based upon what he had learned from the
parties and upon the application of the law which have been canvassed by the parties. Save for
the need to comply with the provisions in s.33 of the Act, there is no set form for an award unless
the arbitration agreement requires it to be in specific form. The award is a legal document and it
must contain enough information to enable the court, if called upon to do so, to enforce it
without the need for further inquiry. An award must be prepared with the greatest care and as a
matter of practice there are some basic requirements.
FORMAL REQUIREMENTS OF AN AWARD There are no particular requirements for the
form of an award. However, there are a number of matters that are usually included which could

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be termed as “formal” per s.33 of the Act. The Arbitration Award - 5 - • The most
commonsensical requirement is that the award be in writing and signed by the arbitrator per
s.33(1). More often than not, his signature is attested by a witness. • The award should identify
and state precisely who the parties are. This is normally done at the beginning of the award in the
recitals. • Unless otherwise agreed by the parties or if it is a consent award, s.33(3) requires a
reasoned award to be made. • The award should list the date and locate (seat of arbitration) the
award per s.33(4). Dating the award is particularly important with regard to the payment of
interest on a monetary sum. Once the arbitrator has signed and published his award he is said to
be functus officio, having performed his duty. If the agreement provides that the arbitrator shall
make and publish the award, it becomes valid upon publication.
The agreement may require that the award is ready to be delivered on a fixed day but if it is not
actually delivered it is nevertheless valid. If there is condition, however, that it shall be delivered
on a fixed day and delivery does not take place it is void. Three copies of the award are usually
made, two of which are signed by the arbitrator. One signed copy is delivered to the party taking
it up. Either party can take up the award.
The other signed copy will be sent to the other party on request. It is usual for the arbitrator to
retain the award until the award has been taken up by the parties. The arbitrator has a lien on his
award and he normally only delivers his award upon payment of his fees and expenses or the
remainder of his fees and expenses. Section 44(4) of the Act provides that where the arbitrator
refuses to deliver his award before the payment of his fees and expenses, the court may order the
arbitrator to deliver the award on such conditions as the court thinks fit. The Arbitration Award –

SUBSTANTIVE REQUIREMENTS
For those from non-legal backgrounds, substantive law establishes principles and creates and
defines rights limitation under which society is governed; as against procedural law which sets
the rules and methods employed to obtain one’s rights and, in particular, how the courts are
conducted. According to Mustill, M.J. and Boyd, S.C., The Law and Practice of Commercial
Arbitration in England (2nd ed., at p. 384), the court will not enforce an award unless it is: (a)
Cogent (dictionary meaning: powerful or convincing); (b) Complete; (c) Certain; (d) Final; and
(e) Enforceable. The meanings of above-mentioned terms are self-evident. Therefore the terms of
an award must be unconditional, non-contradictory, unambiguous and unimpeachable. The

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arbitrator must be very precise in his adjudication. Drafts must always be checked thoroughly to
ensure that they meet all those requirements.

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CHAPTER 3: RECOURSE AGAINST ARBITRAL
AWARD
Section 34 of the act ,1996, deals with setting aside of an arbital award. Court cannot suo moto
set aside an arbitral award .By virtue of section 34 an arbitral award can be set aside by a court
only on an application. Such an application for setting aside any arbitral award shall be made
within three months from the date on which the party making the application had received the
award .
However, if the court is of the opinion that, the applicant is prevent by sufficient cause from
making the application within the prescribed period of three months, court may entertain the
application within a further period of thirty days, but not thereafter. An application under section
34 to set aside an arbital award is to be filed within the percsribed period under sub- section 3 of
the act ,1996.1 An application under section 5 of the Limitation Act,to condone the delay is not
delayed in not maintainable.2
By virtue of section 34 of the Act ,an arbitral award may be set aside by the court on following
grounds ;
A) Incapacity of a Party: An arbitral award may be set aisde by the court on proof of the
fact that, party was under some incapacity. An award which is invalid under the
governing minors ought to be set aside.3
B) An arbitration agreement is not valid: Invalidity of reference would be good ground for
challenging the award passed by an arbitrator.4 An arbitral award may set aside by the court if
the party making the application furnishes proof that ,the arbitration agreement is not valid under
the law the law to which the parties have subject it or,failing any indication thereon, under the
law for the time being in force in India.
In case a contract is denied and there is no valid submission, the matter relating to the contracts
cannot go to arbitration and the award on that basis is without any legal validity.5
If the arbitrator has not examined the plea of lack of jurisdiction, and as to whether, the contract

1 Union of India v. Popular Construction Co.2001(8)SCC 470

2 Id
3 Lakshminarayana tantric v.Ramchandra tantri,AIR 1919 Mad 1029 (DB).
4 Union of India v.Narinder Singh Kanwar,AIR 1982 Par 238.
5 Chinoy of India v. Jai Society Wood Works,AIR 1998 Delhi 187.

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 entered into between the parties complied with the requirements of law as contained under Article
299 of the Indian Constitution; the award passed by him is liable to be set aside.6
Where a contract is denied and there is no valid submission, the matter relating to the contract
cannot go to the arbitration and the award on that basis is without any legal validity.
Further , by the virtue of Section 16 of the Act, if the arbitration agreement is invalid, the plea of
invalidity of an arbitration agreement may be raised before the arbitration tribunal itself to
contend that, it lacks jurisdiction to arbitrate. Once the award is made the party may then make an
application to set aside the award under Section 34 of the Act.

C) Non-existence of Dispute or Arbitration Agreement: By virtue of Section 16(1) of the Act, a

party to the arbitration proceedings may raise a plea that, arbitral tribunal has no jurisdiction
since there is no dispute or arbitration agreement. If the tribunal takes a decision rejecting the
plea of lack of jurisdiction, the arbitral tribunal shall continue with arbitral proceedings and make
an arbitral award. A party aggrieved by such arbitral award may make an application for setting
aside such an arbitral award under section 34.
Where an arbitration clause is admittedly inserted after the parties had signed the Memorandum
of Understanding and had not been signed or even initiated by them, referring the matter to the
arbitrator named in the said arbitration clause would be unwarranted and unjustified and therefore
the award, of the arbitrator deserved to be set aside.7
When both the parties accepted the existence of the arbitration clause in the agreement and they
proceeded on that basis , the appellant cannot thereafter btake the plea of “no arbitration clause ‘’
for the first time appeal before the High Court .8
If the petitioner did not take jurisdiction point before the arbitration and allowed the arbitration,
to pass final award, such plea cannot be allowed to be taken in the application for setting aside
the award for first time. Further court cannot probe the mental process of an arbitrator in
application under section 34 of the Act about .
D) No proper notice of appointment of Arbitration :By virtue of Section 34(2) (a)(iii) of the
Act,1996, an award may be set aside by the court if the party making an application furnishes
proof that,he has not given proper notice of the appointment of an arbitrator or of the arbitral
proceedings or was unable to present his case.

6 UOI v. Jai Society Wood Works

7 Harjinder Pal v.Harmesh Kumar,O.M.P 105/2005,O.M.P.34/2005.

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 E) Ignorance of the term of the arbitration agreement :Arbitrator being a creature of the
agreement between the parties has to operate within the four corner of the agreement and if he
ignores specific terms of the contract, it would be a question of jurisdictional error on the face of
the contract, it would be a question of jurisdictional error on the face of the award, falling within
the ambit of the legal misconduct which could be corrected by the court. An arbitrator derives his
authority from the contract and if he acts in disregard to the contract, he acts without
jurisdiction.A deliberate departure from contract amounts to not only manifest disregard of his
authority or misconduct on his part, but it may tantamount to a malafide action. If he wander
outside the contarct and deals with matters not allotted to him ,he commits a jurisdictional error.
An arbitrator cannot ignore the law or misapply it in order to do what he thinks is just an
reasonable. He is a tribunal selected by the parties to decied their dispute according to
law and so is bound to follow and apply the law and if he does not he can be set right by
the Court provided his error appears on the face of the award.9
An arbitral award may be set aside by the court if the award deals with a dispute not
contemplated by or not falling within the terms of submissions to arbitration.
(f) Improper composition of the arbitral tribunal:
By virtue of section 34(2)(a)(v) of the Act, court can set aside the arbitral award if the
party making an application furnishes proof that the composition of the tribunal was not
in accordance with the agreement of the parties.
Supreme Court is of the opinion that10
(1) Section 34(2)(a)(v) of the Act applies if the composition of the arbitral tribunal of the
arbitral procedure was not in accordance with the agreement of the parties.
(2) If the composition of the arbitral tribunal on the arbitral procedure is in accordance
with the agreement there can be no challenge under their provision merely on the
ground that the composition of the arbitral tribunal was in conflict with the provisions
of Part I of the Act 1996.
(3) When the composition or the procedure is not in accordance with the agreement of
the parties get a right to challenge the award. But even in such a case, the right to
challenge the award is available only if the agreement of the parties is in conflict with
a provision of Part I which the parties derogate. In other words, even if the

9 Food Corporation of India v. Chandu Construction,(2007)4 SCC 697

10 Narayan Prasad Lohia v. Nikunj Kumar Lohia, AIR 2002 SC 1139

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 composition of the arbitral tribunal or the arbitral procedure is not in accordance with
the agreement of the parties nut if such composition or procedure is in accordance
with the provision of the Act, then the parties cannot challenge the award.
(4) If there is no agreement between the parties, providing for the composition of the
arbitral tribunal or the arbitral procedure and the composition or the arbitral procedure
was not in accordance with Part I of the Act, then a challenge to award would be
available.

(g) Award not in consonance with the public policy:

An arbitral award may be set aside by the court it is found that, the arbitral award is in
conflict with the public policy in India. The term “public policy” has not been defined in
the Act. A simple attempt to describe it is contained on the Legal Glossary of the
Ministry of Law, Justice and Company Affairs, Government of India , namely that, a
public policy is “a set of principles in accordance with which communities need to be
regulated to achieve the good of the entire community or Public”11
Within public policy of India, lay certain determinate specified heads and that, it would
not be prudent to being search for new heads. However, in Central inland Water
Transport Corp Ltd. v. Borjo Nth Ganguly,12 Supreme Court promoted a wider stance by
interpreting the term public policy on the pillar of public conscience, public good and
public interest.
Further, Supreme Court opined that, in case where the validity of award is challenged,
there is no necessity of giving a narrow interpretation to the term public policy in India.
On the contrary, wider interpretation is required to be given so that, the patently illegal
award passed by the tribunal could be set aside.13

11 P Anklesaria, “scope of the expression public policy in domestic and

foreign awards,” 9 AIR (2005) at 310
12 AIR 1986 SC 1571
13 ONGC v. Saw Pipes, AIR 2003 SC 2629

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CHAPTER 4: FINALITY & ENFORCEMENT OF
AWARD

Finality of Award
An award of an arbitrator is as binding on the parties to the reference as if it were a decree of the
court even in respect of such provisions as have not been embodied in the decree by the virtue of
their not pertaining to the subject matter of suit14. An award is final and binding on the parties
and it is not a piece of waste paper.15
When the award becomes final, it puts an end to the controversies between the parties and points
which were taken either in attack or an arbitrator is made voluntarily and the reference was not
legal for any other reason then, the award must be held to be binding on the parties.16
The award creates new right or rights in favor of the successful party, where he can enforce in
the courts in substitution for the rights in which the claims or defense respectively found,
therefore it is implied term of the application that, the parties agree to perform the award. An
obligation to similar effect also appears, in many sets of arbitration rules.17
An arbitration is not required to write a detail judgment as required in a court of law. However,
an arbitration must give reasons in support of the award, without setting out every process of
reasoning, and many not deal with every point raised by the parties but it is certainly obligatory
on the part of arbitrator to set out the reason as to why h ehas came to a particular conclusion.18
However, if the arbitrator fails mention the basis on which he had reached the conclusion while
allowing compensation to the contractor on account of prolongation of the contract period, the
award is liable to be set aside.
Arbitrator is the final arbiter of dispute between the parties and the award is not open to
challenge on the ground that, arbitrator has drawn his own conclusion or has failed to appreciated

14 Kolavakolam Seetanna v. Poddri Nrayanamurti Somayajulu, AIR 1920 Mad

615(DB).
15 Section 35. See also MS Ramaiah v. State of Mysore, AIR 1973 Mys. 17
16 Radha Kishen v. Sappattar Singh AIR 1957 ALL 406 (DB)
17 Associated Electric and Gas Insuranbce Services Ltd. v. European

Reinsurance Co. of Zurich (2003)All ER(D) 308 (Jan), as seen in Russell on

Arbitration, 23rd ed., para 6. 163, p.334.
18 Anant raj agencies v. Delhi development Authority, 2005 (1) Arb LR

590(Delhi).

16
the facts. Court cannot look into the reasonableness of reason given by the arbitrator while
making the award. An award is liable to be set aside. If the reason are totally erroneous and
contrary to the materials available before the court.
In Décor India P. Ltd v. National Building Const.Corpn..,19 the learned single judge has minutely
examined the provision of law for distinguishing a decree passed in a civil suit and an Award
passed in arbitration proceeding and has extensively referred to the provision of the Code of
Civil Procedure for execution of the decrees as has then interpreted Section 35&36 of the act to
hold that there is no automatic stay due to pendency of the appeal.
If we had the provision of section 35,36 &37 of the act and order XLI Rule5 of Code OF Civil
Prodecure on the light of the laudable objects of the Arbitration & Conciliation Act,1996 we
find that there is no manner of doubt that the very purpose of Arbitration & Conciliation Act
,1996 is to curb the procedural delays as are inherent in the routine civil disputes in the courts.
In fact, a summary procedure has been envisaged in the Act in contra-distinction to the
Arbitration Act of 1940.
According to section 35 of the act, an award reaches its finality as and when the action taken
under Section 34 of the act is dismissed since, there is no provision for second appeal to
challenge the validity of an award. However ,the constitutional provision to approach the
Supreme Court is not and cannot be touched by this enactment.
The court has minutely examined the provision of law for distinguishing a decree passed in a
civil suit and a Award passed in arbitration proceeding and has extensively referred to the
provision of the Code of Civil Procedure for Execution of the decree and has then interpreted
Section 35&36 of the act to hold there is no automatic stay due to pendency of the appeal.
Enforcement of Arbitral Award
By virtue of section 36, where the time for making a application to set aside the arbitral award
under section 34 has expired, or such application having been made, it has been made, it has
been refused, the award shall be enforced under the Code of Civil Procedure,1908 in the same
manner as if it were a decree of the court.
The propostion of law canvassed by party in person for the petitioner, who is seeking
enforceability of the award , when an application under section 34 of the act is pending before
the District Court , Valsad is not permissible in view of the decision rendered by the Hon’ble

19 142(2007)DLT 21.

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Surpreme Court between National Aluminum Co.ltd v. Pressteel & Fabrications (P) ltd.,20 the
relevant portion of para 10 reads as under:
“….At one point of time , consideration the award as a money decree, we were inclined to direct
the party to deposit the awarded amount in the court below so that the applicant can withdrawn
it, on such terms and conditions as the said court might permit in to do as an interim measure.
But then we noticed from the mandatory language of section 34 of the 1996 Act, that an award,
when challenged under Section 34 within the time stipulated therein, becomes unexecutable.
There is no discretion left with the court to pass any interlocutory order in regard to the said
award expect to adjudicate on the correctness of the claim made by the applicant therein.
Therefore that being the legislative intent, any discretion from us contrary to that, also becomes
impermissible. On facts of this case, there being no exceptional situation which would compel us
to ignore such statutory provision, and to use our jurisdiction under Article 142, we restraint
from passing any such order, as prayed for by the applicant.
In the aforeside judgement, it is expressed in para-11 of the judgement that there is an
automatic suspension of the execution of the award, once an application challenging the said
award , once an application challenging the said award field under section 34 of the act is
pending. The amendent is also suggested but as stated herein above, especially in the judgement
delivered by the apex court, the court cannot recast, reframe and restructure the law on its own.
This interpretation of section 36 made by the Hon’ble Supreme Court is not enforceable, once
the application under section 34 of the Act is pending before the District Court.”
However , it is not the duty of the court either to enlarge the scope of the legislation or the
intention of the legislature when the language of the provision is plain and unambiguous. The
court cannot rewrite, or reframe the legislation for the very good reason that it has no power to
legislate. The power legislate has not been conferred on the courts. The court cannot add words
to a statue or read words into it which are not there.21
An award, when challenged under section 34 within the time stipulated therein, becomes
unexecutable. There is no discretion left with the court to pass any interlocutory order is regard
to the said award expect to adjudicate on the correctness of the claim made by the applicant

20 (2004)1SCC 540.
21 Union of India and Anr.v. Deoki Aggarwal AIR 1992 SC 96.

18
therein. Therefore, that being the legislative intent, any direction from us contrary to that, also
become impermissible.
Under section 36, an arbital award can be enforced under the Code of Civil Procedure in the
same manner as us if it were a decree of the court. The arbitral award can be enforeced where the
time for making an application to set aside the arbitral award section 34 has expired or in the
event of such an application having been made, it has been refused. The enforcement of an
award ensures the benefit of the party who has secured an award in the arbitral proceedings.
The enforceability of an award with reference to the failure of the other side of an application
for setting aside the award within the stipulated time limit or having field such as application has
failed to establish a case for setting aside the arbitral award.

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 CONCLUSION
The parliament has enacted arbitration and conciliation act with a view to provide speedy remedy
by arbitration and to achieve the objective, section 5 of the act puts a complete bar on the
convention of the courts in matter where there exist an arbitration clause. The law of arbitration
in India is very much at its crossroads. As things stand today , arbitration is poised to effect great
changes to the way in which dispute resolution is conducted. It bring with it the solemnity and
finality of the judicial process and couple it with the procedural flexibility of non-conventional
dispute resolution methods. There is, however an equally pressing need to recognize that much
more can and should be done to improve the conduct of arbitral proceedings in India but most
importantly, we feel that there is a need to effect a change in perception. As our nation moves
towards increasing litigiousness, alternative methods of dispute resolution might just provide the
key to resolving the problem of overburdened cases loads, long pendency of cases and an all too
frequent case of justice being delayed. For long, the problem plaguing the effective
implementation of ADR method has been their perception as being subordinate to the court
process-a perception shared and fostered by lawyer and people alike. It is imperative that this be
changed and this can only be achieved if there is active engagement from all the stakeholder in
this process. Certainly there are some dispute inherently unsuited for alternative channels but
there are so many more which fit perfectly within the version envisaged for a system of
rendering justice that runs concurrent to the court. It is necessary for the court themselves to
mandate recourse to ADR methods in inter alia international commercial disputes,
employment dispute, matrimonial cases, compoundable criminal offences, to name just a few.
Saw pipe case’s expanded judicial review is especially unsuitable in the Indian context where
court are overwhelmed with backlog. In such scenario to permit a challenge on merit would
considerably delay the enforcement proceedings. A majority of parties opting for arbitration do
so to avoid court delays and legal niceties. An unfortunate side effect of this decision is that it
has become a ground for parties to shift the venue of arbitration outside India. The supreme
court’s decision (venture global engineering case ) files in the face of modern commercial
practice. At the end of the day , what should take precedence is the provision of justice, in
substance more than in form. As our country grows and flowers, taking wing in issue
unimagined before , it is time also for our dispute resolution systems, the undisputed backbone
of our nation, to follow suit. At the end of the day arbitration would see the day light of true

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success when people would start accepting the arbitral award and its finality as that of a
judgment by the supreme court not because it is justice always but because it is final always,
having no further appeal.

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 BIBLIOGRAPHY
1. AVTAR SINGH, LAW OF ARBITRATION AND CONCILIATION (8th ed., Eastern Book Company
2007).
2. BERNSTEIN, BERNSTEIN’S HANDBOOK OF ARBITRATION AND DISPUTE RESOLUTION

PRACTICE (4th ed., Sweet & Maxwell 2003).

3. G.K.KWATRA, ARBITRATION AND CONCILIATION LAW OF INDIA (7th ed., Universal Law
publishing 2010).
4. O.P.MALHOTRA, LAW AND PRACTICE OF ARBITRATION (2nd ed., Lexis Nexis 2006).
5. REDFERN AND HUNTER, LAW AND PRACTICE OF INTERNATIONAL COMMERCIAL
ARBITRATION (4th ed., Oxford University Press2004).
6. RUSSELL, RUSSELL ON ARBITRATION (22nd ed., Sweet & Maxwell 2003).

References:

1. Law Commission of India, 176th Report on Arbitration and Conciliation (Amendment)

Bill, 2001 at p 68.
2. http://lawcommissionofindia.nic.in/adr_conf/nageswara%20rao10.pdf
3. http://lawcommissionofindia.nic.in/adr_conf/concepts%20med%20Rao%201.pdf
4. http://arbitrationandconciliation.wordpress.com/
5. http://en.wikipedia.org/wiki/Arbitration

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