SUPREME COURT
The Supreme Court has held that an arbitral award delivered after an inordinate and unexplained delay is liable to be set aside, as it renders the award patently illegal and contrary to the public policy of India.
The bench of Justice Sanjay Kumar and Justice Satish Chandra Sharma observed that while mere delay is not a standalone ground to set aside an award under Section 34 of the Arbitration and Conciliation Act, 1996, an arbitrator who takes years to deliver an award without justification risks rendering it contrary to the public policy of India.
The Supreme Court has dismissed MMTC Limited’s objections under Section 47 of the Code of Civil Procedure, which sought to resist execution of a USD 78.7 million arbitral award in favour of Anglo American Metallurgical Coal Pvt. Ltd., holding that the allegations of fraud and collusion were unsubstantiated, and not backed by adequate proof.
The Supreme Court dismissed an appeal challenging the Punjab & Haryana High Court’s refusal to appoint an arbitrator under Section 11(6) of the Arbitration and Conciliation Act, 1996.
The Bench of Justice Dipankar Datta and Justice Augustine George Masih held that Clause 8.28 of the Software Implementation Agreement between M/s Alchemist Hospitals Ltd. and M/s ICT Health Technology Services India Pvt. Ltd. did not constitute a valid arbitration agreement under Section 7 of the Act, as it lacked the essential conditions of a binding arbitral process.
Arbitral Tribunal Ignored Railway Board Policy, and Practically ‘Rewrote’ Contract; SC Set Aside Award Against IRCTC As Patently Illegal
The Supreme Court has set aside an arbitral award in favour of catering contractors against the Indian Railway Catering and Tourism Corporation (IRCTC), holding that the award was patently illegal and contrary to public policy, as it ignored binding Railway Board circulars and misconstrued the terms of the catering contracts.
The Bench of Justice Sanjay Kumar and Justice Satish Chandra Sharma held that the Arbitral Tribunal had completely overlooked the binding policy framework governing catering services on Indian Railways. The Court emphasised that IRCTC, being an implementing agency of the Railway Board, had no discretion to deviate from the policy directives and could not be held liable for acts performed strictly in compliance with such circulars.
The Supreme Court has refused to interfere with an arbitral award directing Sri Lakshmi Hotel Pvt. Ltd. and its Managing Director to pay over ₹2.21 crore with 24% interest to Sriram City Union Finance Ltd., holding that the rate was contractually agreed and not unconscionable in the context of a high-risk commercial loan.
The Bench of Justice J.B. Pardiwala and Justice K.V. Viswanathan observed that, in a commercial lending arrangement, it cannot be said that the imposition of an exorbitant rate of interest, viewed against contemporary commercial practices, violates the fundamental policy of Indian law or offends basic notions of morality or justice.
SC: Section 11 Plea ‘Fundamentally Misconceived’ in Foreign-Seated Arbitration
The Supreme Court has dismissed the Arbitration Petition filed by Balaji Steel Trade seeking constitution of a sole arbitral tribunal in India, holding that the dispute arises exclusively under a Benin-seated arbitration clause contained in the Buyer–Seller Agreement (BSA) executed with Fludor Benin S.A. The Bench of Justice Pamidighantam Sri Narasimha and Justice Atul S. Chandurkar concluded that the petition was fundamentally “misconceived” and legally untenable, since Part I of the Arbitration and Conciliation Act, 1996 does not apply to a foreign-seated arbitration.
OTHER COURTS
ALLAHABAD HIGH COURT
Allahabad HC Stays Unilateral Arbitration Initiated by Yes Bank; Calls It Void Ab Initio
The Allahabad High Court, Lucknow Bench, comprising Justice Shekhar B. Saraf and Justice Prashant Kumar, stayed arbitration proceedings initiated by Yes Bank Ltd. against Mahakaleshwar Infratech Pvt. Ltd., holding that a unilaterally commenced arbitration is void ab initio.
The petitioner, through a writ petition, challenged the unilateral invocation of arbitration by Yes Bank, asserting that the bank had initiated proceedings without obtaining its consent. It was further alleged that the Jupiter Council for Arbitration and Mediation, functioning as a self-appointed forum, had passed an interim order directing the seizure of the petitioner’s truck, despite the petitioner having already cleared all outstanding dues.
BOMBAY HIGH COURT
The Bombay High Court has held that an arbitral tribunal cannot decide a claim by withholding essential documents from a party. Justice Somasekhar Sundaresan set aside both the arbitral award and the District Judge’s order that had upheld it, holding that the tribunal’s denial of essential documents amounted to a violation of natural justice and deprived the contractor of a fair opportunity to present its case.
The Bombay High Court has directed the appointment of a substitute sole arbitrator through Presolv360 after holding that the earlier arbitrator’s mandate had effectively expired due to a series of delays, unilateral fee escalations, suspension of hearings, and eventual time-bar under Section 29A of the Arbitration and Conciliation Act, 1996. Justice Somasekhar Sundaresan observed that the arbitrator neither resigned nor continued proceedings but kept the arbitration in “suspended animation,” resulting in the mandate lapsing by efflux of time.
The Bombay High Court has dismissed a challenge filed by the Uttar Pradesh Legislative Assembly Secretariat under Section 34 of the Arbitration and Conciliation Act, 1996, thereby upholding the arbitral award in favour of Tata Consultancy Services (TCS) in a dispute arising from the conduct of online recruitment examinations for Review Officers and Assistant Review Officers.
The arbitral tribunal had declared that the Secretariat’s termination of the 5 December 2015 service agreement was illegal, directed payment of ₹5.37 crore with 1.5% monthly interest, and awarded ₹11 lakh in costs. The High Court found no perversity or grounds to set aside the award.
The Bombay High Court rejected the Uttar Pradesh Legislative Assembly Secretariat’s preliminary objection that the arbitral award was unenforceable because the State of Uttar Pradesh was not a party to the arbitration agreement. Justice Sandeep V. Marne noted that the description “State of UP through UPLA Secretariat” was adopted only after the Court’s own query during Section 11 proceedings, and held that for enforcement purposes, the Secretariat cannot be treated as an entity entirely distinct from the State. The Court concluded that this objection was hyper-technical and did not affect the validity of the award.
The Bombay High Court clarified that every right of an investor to participate in the management and governance of a joint venture company cannot be converted into an obligation to participate in the management. When an investor invests in a company, he contracts certain rights, and it is completely bestowed on him whether he wants to enforce or waive them.
The dispute at hand is a case of firm findings by the Arbitral Tribunal that one party to the Joint Venture Agreement (JVA) blatantly diverted the business away, wrongly seeking to justify it on the grounds of abandonment, and even raising the objection of limitation, all of which were firmly put down by the Arbitral Tribunal. Yet, the Tribunal victimised the other party by holding that the victim itself needs to be blamed for breach of its rights by not participating in the JVA; and that too when adjudicating a cause of action seeking intervention for that very breach.
The Court noted that on one hand, the Arbitral Tribunal had firmly held that the Vaghani Group had “miserably failed” to show abandonment of the JVA by the Subhkam Group, by ruling that acquiescence is neither pleaded nor synonymous with abandonment. In the same breath, the Arbitral Tribunal has equated the contractual rights of the Subhkam Group with their contractual obligations, which is completely untenable and an implausible view.
Pointing out that ‘a cleverly drafted challenge under Section 34 of the Arbitration and Conciliation Act, 1996, cannot transform a non-Arbitral Order into an Arbitral Award, the Bombay High Court clarified that corporate procedural formalities are flexible enough to uphold substantive justice without being obstructed by rigid technicalities. Pointing out that any breach of Section 174(2) of the Companies Act may attract a sanction rather than automatically invalidating all actions, given the potential impact on every corporate decision and operation, the Court opined that given the multiple complexities involved, the Arbitral Tribunal has appropriately rejected Master Drilling’s absolutist argument for an outright non-suit of Sarel Drill under Section 32 of the Arbitration Act.
The Court observed that the Arbitral Tribunal appropriately refused to non-suit Sarel Drill merely on the claim of an absence of corporate mind. It is only for the Arbitral Tribunal to examine whether a Board Meeting is necessary to initiate arbitration or whether the individuals who acted had existing authority to do so. Essentially, the Court left it to the Arbitral Tribunal to assess whether a Board Resolution is foundational or merely commemorative, and whether decisions taken by a non-quorate Board could be validated retrospectively once quorum is restored.
CALCUTTA HIGH COURT
The Calcutta High Court has set aside an arbitral award passed against the Kolkata Metro Rail Corporation Limited (KMRCL) in its dispute with ITD-ITD Cem Joint Venture, holding that the award was vitiated by perversity, bias, and patent illegality.
Justice Sabyasachi Bhattacharyya held that the arbitral tribunal acted in violation of fundamental principles of law by relying on its own professional knowledge instead of tangible evidence, and by applying ‘double standards’ in assessing expert reports filed by the two parties.
The Calcutta High Court has set aside an arbitral award of ₹14.68 Crore in a construction contract dispute, holding that the tribunal committed patent illegality by treating the parties’ contract as not having lawfully commenced for lack of a sanctioned municipal plan and then awarding contractual damages nonetheless.
Justice Ravi Krishan Kapur found that the tribunal had rewritten the contract, and left numerous pleaded breaches and counter-breaches undecided, which has vitiated the award.
The Calcutta High Court dismissed an application filed under Order XXI Rule 58 & Section 151 CPC read with Section 36 of the Arbitration and Conciliation Act, 1996 by Starlight Real Estate (Ascot) Mauritius Ltd. and Starlight Real Estate Mauritius Ltd., objecting to the execution of an arbitral award dated May 16, 2013. The applicants alleged that the award, which was being executed by Jagrati Trade Services Pvt. Ltd., was obtained by fraud and collusion, and therefore non-executable in law.
The Court rejected the plea, holding that the objections were barred by res judicata, as the same issues had already been decided in an earlier civil suit and its subsequent appeals. Earlier, the Division Bench had dismissed the suit on merits, holding that the shareholders (the applicants) had no independent right to challenge the arbitral award passed against the Augustus Avani Land Developers Pvt. Ltd. That decision was affirmed by the Supreme Court in February 2024, which declined to interfere.
Justice Krishna Rao observed that the applicants cannot circumvent the earlier rulings by filing a collateral challenge during execution. The Court found that the plea of fraud, which was the foundation of the current application, had already been adjudicated upon.
DELHI HIGH COURT
The Delhi High Court has upheld the arbitral award that had declared the BALCO Shareholders’ Agreement (SHA) between the Union of India and Sterlite Industries, as void for violating Section 111A(2) of the Companies Act, 1956. Justice Subramonium Prasad held that the arbitral tribunal’s interpretation of “free transferability” was erroneous and contrary to the legislative intent and commercial reality governing shareholder agreements.
The dispute traces back to the Government of India’s 2001 disinvestment of Bharat Aluminium Company Limited (BALCO). In a subsequent bid, Sterlite Industries (India) Limited was selected as the successful bidder and acquired 51% of BALCO’s equity shareholding under a Share Purchase Agreement (SPA) and a concurrently executed Shareholders’ Agreement (SHA), while the Government retained the remaining 49% stake.
The Delhi High Court has refused to interfere with an arbitral tribunal’s decision dismissing NHAI’s application to substitute itself with the concessionaire in an ongoing arbitration arising from the termination of the NH-8B concession agreement. Justice Girish Kathpalia agreed with the respondent’s submission that dropping NHAI and substituting the SPV could jeopardise the ARC’s claims, thereby frustrating the arbitral process.
The Delhi High Court allowed MTNL’s appeals, setting aside the Single Judge’s order upholding two arbitral awards in favour of Motorola, and remanded the matter for a fresh decision on MTNL’s Section 34 petitions.
The dispute between Mahanagar Telephone Nigam Limited (MTNL) and Motorola Inc. originated from a 1999 tender by MTNL for the supply and installation of CDMA telecom equipment. Motorola was awarded contracts through three purchase orders (PO1 in 2000, PO2 in late 2000, and PO3 in 2002).
While strongly asserting that the ‘Registered Office’ does not establish territorial jurisdiction if no cause of action has arisen at that office, the Delhi High Court held that even if parties have agreed to an exclusive jurisdiction clause, they cannot grant jurisdiction to a Court that otherwise lacks authority over the subject matter. The exclusion of some Courts’ jurisdiction is allowed only if the Court receiving exclusive jurisdiction already has proper jurisdiction.
The Court clarified that exclusive jurisdiction clauses act as ouster clauses. Reference was made to the decision of the Supreme Court in the case of Swastik Gases Private Limited v. Indian Oil Corporation Limited [(2013) 9 SCC 32], where it was held that even if an agreement does not specifically use words like ‘alone’, ‘only’, ‘exclusive’, or ‘exclusive jurisdiction’, the construction of such a clause is unaffected because of the maxim ‘expressio unius est exclusio alterius’, provided there is nothing to the contrary in the agreement.
Emphasising that party autonomy in arbitration matters is of utmost importance, the Delhi High Court ruled that if an insurance policy was made after the referred IRDAI Circular and Gazette Notification and contains an arbitration clause, then the insurer cannot plead justification to issue an insurance policy containing an arbitration clause, unless the insurer (respondent) wanted to have an arbitration clause in its insurance policy.
The Court clarified that having signed the Insurance Policies after the IRDAI Circular came into existence and was duly gazetted shows that the respondent, despite the existence of the IRDAI Circular, chose to go ahead with the Insurance Policies containing the arbitration clauses. Hence, the respondent has given up its reliance on the IRDAI Circular for the Insurance Policies.
In an appeal filed under Section 37(1)(a) of the Arbitration and Conciliation Act, 1996 (A&C Act), read with Section 13(1-A) of the Commercial Courts Act, 2015, to challenge an order dated 28-08-2024 by the District Judge (Commercial Court-02), South West District, Dwarka, New Delhi, whereby the application filed under Section 8 of the A&C Act was dismissed, a Division Bench of Justice C. Hari Shankar and Justice Om Prakash Shukla set aside the impugned order and referred the parties to arbitration while dismissing the pending civil suit for being barred by l
The Delhi High Court has issued notice in a Section 34 petition challenging an arbitral award passed by the Standing Arbitral Tribunal of the West Central Railway. The petition, filed by M/s Royal Infraconstru Limited, seeks to set aside the award dated 17 July 2025, by which all its claims were rejected.
Appearing for the petitioner, counsel argued that the constitution of the Standing Arbitral Tribunal itself was unlawful. It was contended that the members were unilaterally appointed by the Railways through a “curative list” prepared by the respondent, rendering them ineligible under the law laid down in Central Organisation for Railway Electrification v. ECI SPIC SMO MCML (JV), 2024 SCC OnLine SC 3219. According to the petitioner, this vitiated the entire arbitral process.
Justice Jasmeet Singh, noting the submissions, issued notice to the Union of India / West Central Railway through all permissible modes. The respondent has been directed to file its response, with the matter now made returnable on 11 March 2026.
GUJARAT HIGH COURT
The Gujarat High Court dismissed a writ petition filed under Articles 226 and 227 of the Constitution challenging the arbitral tribunal’s jurisdiction in a partnership dispute, holding that such interference would “dismantle the efficiency and autonomy of arbitration.”
The petitioner had challenged an order of the arbitral tribunal rejecting his Section 16 application under the Arbitration and Conciliation Act, 1996 (“A&C Act”), which had questioned the tribunal’s jurisdiction to adjudicate disputes relating to the dissolution and distribution of assets of a partnership firm.
SICC
The Singapore International Commercial Court (SICC) has rejected an application by ONI Global Pte Ltd and LAC Global (Singapore) Pte Ltd (the “Franchisees”) to set aside the enforcement of an arbitral award in favour of GNC Holdings LLC (the “Franchisor”).
The three-judge bench of Justice Chua Lee Ming, International Judge Simon Thorley, and International Judge James Allsop, found that the arbitral tribunal had acted within its jurisdiction and had not breached natural justice in ordering the franchisees to assign the leases of 54 GNC stores in Singapore to the franchisor, as required under the franchise agreement. However, the SICC varied the enforcement order slightly, declining to enforce subparagraphs (ii) and (iii) of the specific performance directions, which had been made without giving the franchisees an opportunity to make submissions and were likely to invite unnecessary debate and supervision.