The first quarter of 2025 has witnessed several notable court rulings that continue to shape how arbitration law is understood and applied in India. From issues around re-arbitration to delivery of awards and timelines under the Arbitration and Conciliation Act, 1996, the Courts’ decisions have addressed a range of procedural and substantive questions.
Let’s take a closer look at these important verdicts and examine how these contribute to the ever-evolving arbitration landscape in India.
Can parties re-arbitrate if an arbitral award is set aside?
The Delhi High Court in the case of Jaiprakash Associates Ltd, ruled that once an arbitral award is set aside due to lack of evidence, a second round of arbitration on the same issue is not allowed. The Court held that the petitioner had already exhausted its opportunity and failed to prove its claim. Re-arbitrating would amount to reopening a settled matter and violate the principle of res-judicata.
Is a Section 34 petition valid without the award copy?
A full bench of Delhi High Court in the case of Pragati Construction v. Union of India held that attaching a copy of the award is a mandatory requirement when filing a petition under Section 34 to challenge an award. If the award isn’t filed, the petition is deemed non-est and the period of limitation would not be interrupted.
Does the use of an incorrect legal provision invalidate an application?
In the case of Mangal Chand v. LAC NHAI, the Himachal Pradesh High Court allowed an application seeking an extension of the tribunal’s mandate, even though it was filed under Section 151 of the Civil Procedure Code instead of Section 29A of the A&C Act. The court ruled that a mistake in citing the procedural provision does not invalidate the petition if the court has the authority to grant the relief.
Can an arbitrator be appointed without formal arbitration clause?
The Lords Inn Hotels v. Pushpam Resorts LLP case had the Bombay High Court stating that although the contract lacked express arbitration clause, several other clauses referenced to it in the agreement indicated that it was omitted by mistake. Applying a business efficacy test, the court upheld the parties’ intention to arbitrate disputes.
Does the limitation period extend if the deadline falls on a court holiday?
In R.K. Transport Company v. Bharat Aluminium Company case, the Supreme Court clarified that if the deadline to file a petition under Section 34(3) of the Arbitration and Conciliation Act, 1996 falls on a court holiday, it can be filed on the next working day. This aligns with the terms of Section 4 of the Limitation Act 1963.
Can Courts enhance the amount awarded by the Arbitral Tribunal?
In the case of Union of India v. Kothari Subbaraju, the Karnataka High Court reversed a District Court decision that increased the arbitral award amount. The High Court stated that under Section 34 of the Arbitration and Conciliation Act, 1996, courts cannot act like appellate authorities and change the award - they can only set it aside based on limited grounds.
Is delivery of the award to the power of attorney holder valid?
The Delhi High Court in the case of Kiran Suran v. Satish Kumar confirmed that delivering the arbitral award to a parties’ authorised power of attorney holder counts as valid delivery under Section 31(5) of the Arbitration and Conciliation Act, 1996.
Is an arbitration clause in a draft/unfinalised Memorandum of Understanding (MoU) binding?
The Calcutta High Court in the case of Greenbilt Industries v. AB Dinesh Concreteruled that an unsigned and incomplete MoU, containing multiple blank sections, is not a binding agreement. Therefore, the arbitration clause in such a document cannot be enforced.
Conclusion
The judicial verdicts from January to March 2025 underscore a maturing arbitration framework, marked by a consistent focus on procedural integrity, statutory adherence, and contractual clarity.
At the same time, there’s a pragmatic approach when interpreting arbitration clauses—whether by applying the test of business efficacy or recognising the validity of award delivery. As arbitration continues to evolve in India, these decisions offer valuable guidance on both the substantive and procedural contours that parties and practitioners must navigate.
* This blog is the first in a four-part series exploring key aspects of the Arbitration law in India.
