The Delhi High Court has held that an appeal under Section 37(1)(c) of the Arbitration and Conciliation Act, 1996 is maintainable even where an application under Section 34 has been dismissed on technical or procedural grounds, including non-compliance with statutory pre-deposit requirements.

A Division Bench of Justice Navin Chawla and Justice Rajneesh Kumar Gupta, while allowing an appeal filed by Primemover Mobility Technologies Pvt. Ltd., clarified that Section 37(1)(c) is not confined to refusals on merits alone but extends to the entire spectrum of orders passed under Section 34.

Relying on the Supreme Court’s ruling in Chintels India Ltd. v. Bhayana Builders Pvt. Ltd., 2021 INSC 76, the Court observed that even a dismissal of a Section 34 petition on grounds such as limitation or procedural default amounts to a refusal to set aside the arbitral award and is therefore appealable under Section 37.

The appeal arose from an order of the Commercial Court dismissing the petitioner’s Section 34 application due to failure to deposit 75% of the awarded amount as mandated under Section 19(1) of the MSME Act. Rejecting the respondent’s objection on maintainability, the High Court restored the Section 34 petition, holding that the dismissal squarely fell within the ambit of Section 37(1)(c).

Setting aside the impugned order, the Court granted the appellant one week’s time to deposit the mandatory amount, failing which the Section 34 petition would stand dismissed automatically.

Appearances:

For Appellant: Mr. Shreesh Chadha, Mr. Kartik Bhatnagar, Mr. Aman Singh Bakhshi, Mr. Shaurya Agarwal, Mr. Faiz, Advs.

For Respondent: Mr. Rohit Jain, Adv.