Topic
Section 37 of the Arbitration and Conciliation Act, 1996, allows appeals against certain orders passed under Section 34 in arbitration proceedings, such as setting aside or refusing to set aside arbitral awards.
The Madras HC ruled that a writ petition under Article 226 cannot challenge an MSMED Council award under Section 18 after a failed Section 34 petition, as Section 37 appeal is the exclusive remedy. The court barred the party from approbating and reprobating on the award's nature.
Delay in an arbitral award alone does not vitiate it under Section 34 unless the delay is unexplained and adversely affects the findings. Thus, an award cannot be set aside just for delay; parties must prove unexplained delay affecting the findings.
The Delhi High Court reinstated the arbitral award, ruling that a claim of patent illegality fails when the award correctly interprets the contract and statutory provisions. This limits parties from overturning awards on that ground, reinforcing the narrow scope of judicial interference in arbitration.
Delhi High Court dismisses appeal, upholding arbitral award and confirming narrow scope of judicial review under Sections 34 and 37 of the Arbitration Act.
The Punjab & Haryana High Court ordered regular bail for Gurkirpal Singh, holding that when the prosecution offers no independent evidence, the constitutional guarantee of a speedy trial under Article 21 overrides the stringent bail denial under Section 37 of the NDPS Act. This establishes that speedy-trial rights can prevail over statutory bail restrictions, benefiting accused in drug cases lacking direct proof.
Omaxe Ltd’s petition under Section 37(1)(c) was dismissed, leaving the arbitral award that orders the builder to pay compensation for delayed possession, with 15% interest, untouched. The ruling clarifies that courts may intervene only for evident misconduct or jurisdictional error, not merely to alter award amounts. Homebuyers and developers in builder-buyer agreements are directly impacted.
The High Court held that detaining an NDPS accused while trial delays are caused by the prosecution breaches Article 21’s speedy-trial guarantee. It granted regular bail, noting that Section 37’s strict bail rules cannot override fundamental liberty. The ruling shields accused from prosecution-driven postponements.
ITAT Jaipur holds that margin penalties levied by NCDEX for shortfalls in commodity trading are compensatory in nature and not prohibited under Section 37 of the Income Tax Act. The ruling deletes the 10% ad hoc disallowance under Section 36(1)(iii), setting a precedent for the tax treatment of such penalties in business expenditure claims.
The Bombay High Court has reaffirmed that courts must not interfere with arbitral interim orders unless they are perverse, capricious, or demonstrate manifest illegality. This ruling strengthens the autonomy of arbitral tribunals in complex slum redevelopment disputes, ensuring that balance-of-convenience assessments remain within the arbitrator’s domain unless grossly flawed.
The ITAT Delhi has ruled that airlines may claim tax deductions for provisions made toward repairing unserviceable aircraft spares, provided the estimate is reasonable and grounded in operational data. This overturns blanket disallowances and affirms that contingent liabilities in capital-intensive industries are not automatically non-deductible under Section 37, setting a critical precedent for aviation and manufacturing sectors.
The Supreme Court upholds an arbitral award for termination payment under a BOT concession agreement, ruling that contractual obligations can be enforced based on implied intent and performance, even if not expressly pleaded. This reinforces party autonomy and narrows judicial review under Section 34, setting a critical precedent for infrastructure arbitrations across public-private partnerships.
ITAT Agra struck down an ad hoc disallowance of nearly Rs 98 lakh, holding that the Assessing Officer cannot estimate expenses under Section 37 without first rejecting the assessee’s books of account. This reinforces a critical procedural safeguard for businesses, ensuring estimation is a last resort-not a shortcut-protecting taxpayers from arbitrary adjustments.
Bombay High Court rules that claimants can withdraw deposited arbitration award amounts under Section 34 challenges, subject to an undertaking to refund if the Supreme Court reverses the order. The ruling clarifies that mere pendency of an appeal does not bar withdrawal, ensuring liquidity for claimants during prolonged disputes.
The Andhra Pradesh High Court ruled that contempt proceedings are not maintainable for enforcing arbitration awards, as the Arbitration and Conciliation Act, 1996 provides exclusive remedies under Section 36. Parties must file execution petitions instead, clarifying the limits of contempt jurisdiction in arbitration disputes.
Calcutta High Court upholds arbitral award, ruling that contractual termination rights must be exercised within a reasonable time of the triggering event. Delayed action or continued conduct amounts to waiver, and judicial review under Section 37 is confined to patent illegality, not reinterpreting contract terms.