Block Development Officer Nadaun v. Designer`s International
2026-03-02
Ajay Mohan Goel
body2026
DailyLaw.ai
JUDGMENT : Ajay Mohan Goel, J. By way of this appeal filed under Section 37 of the Arbitration and Conciliation Act, 1996, the appellant has assailed order dated 02.05.2015, passed by the learned Appellate Court in Arbitration Petition No.1 of 2010/RBT 1/2014, preferred by the present appellant under Section 34 of the Arbitration and Conciliation Act against the award dated 01.02.2010, passed by learned Sole Arbitrator in Arbitration proceedings titled M/s Designer’s International Chandigarh versus The Block Development Officer, Nadaun. Learned Deputy Advocate General has argued that the order passed by the learned District Judge is not sustainable in the eyes of law for the reason that the learned District Judge has erred in not appreciating the statement of PW-1 in the correct perspective as a whole. He further submitted that learned District Judge erred in not appreciating that the learned Arbitrator was not having the jurisdiction to decide the case, which rendered the award to be non-est in the eyes of law. Learned Deputy Advocate General further argued that the learned District Judge erred in not appreciating that the learned Arbitrator had completely ignored the material aspects of the matter and exercised jurisdiction not vested in him and travelled beyond the agreement entered into between the parties. Accordingly, he argued that as the order passed by the learned District Judge was not sustainable in the eyes of law, the appeal be allowed and the impugned order be set aside. 2. On the other hand, learned counsel for the respondent argued that there was no perversity in the order passed by the learned District Judge, who decided the petition filed under Section 34 of the Arbitration Act within the ambit and scope of jurisdiction to decide the same. Learned counsel submitted that the intent of the appellant herein was that the learned Court below should have decided the petition under Section 34 as if it was deciding an appeal by re-appreciating the pleadings and evidence on record without appreciating that in terms of the law declared by the Hon’ble Supreme Court of India, the Court under Section 34 is not to act as an Appellate Court and that the scope of interference is only if there is perversity writ large and if the award is demonstratively to be against the public policy of India.
Learned counsel also submitted that now, in terms of the law declared by the Hon’ble Supreme Court, the Courts have to honour the award passed by the Arbitrator and if the Arbitrator has taken into consideration the respective contentions of the parties as also the material before the learned Arbitrator, then, simply because some other view is possible, the Court is not to substitute its view for that of the Arbitrator. He submitted that in this perspective if the order under challenge is gone through, no infirmity can be pointed out therein. Accordingly, he submitted that as there is no merit in the present appeal, the same be dismissed. 3. I have heard learned Deputy Advocate General as also learned counsel for the respondent and have also carefully gone through the order passed by the learned District Judge under Section 34 of the Arbitration and Conciliation Act. 4. Before this Court proceed further, it would like to refer to the judgment of the Hon’ble Supreme Court in UHL Power Company Limited vs. State of Himachal Pradesh, (2022) 4 Supreme Court Cases 116 (three Judges Judgment), in which judgment, Hon’ble Supreme Court inter alia has been pleased to hold that the jurisdiction conferred on Courts under Section 34 of the Arbitration and Conciliation Act is fairly narrow and when it comes to the scope of an appeal under Section 37 of the Arbitration and Conciliation Act, the jurisdiction of an appellate Court in examining an order, setting aside or refusing to set aside an award is all the more circumscribed. 5. A perusal of the order under challenge demonstrates that the learned District Judge took into consideration the grounds on which the award was assailed by the petitioner before it and it framed the following two issues:- 1. “Whether the award dated 01.02.2010 is liable to be set aside as alleged? OPA. 2. Whether the objection petition has not been filed by the applicant within the period of limitation, as alleged? OPR. 3. Relief.” 6. Thereafter, it went on to adjudicate these issues. While deciding Issue No.1, learned District Judge held that perusal of award demonstrated that after raising the objections regarding appointment etc., of the arbitration, no further action was taken by the petitioner for getting the appointment of the Arbitrator set aside.
OPR. 3. Relief.” 6. Thereafter, it went on to adjudicate these issues. While deciding Issue No.1, learned District Judge held that perusal of award demonstrated that after raising the objections regarding appointment etc., of the arbitration, no further action was taken by the petitioner for getting the appointment of the Arbitrator set aside. Learned District Judge held that, thereafter, the petitioner participated in the arbitration proceedings on merit, therefore, the appointment of the Arbitrator could not be said to be illegal by the appellant. Learned District Judge also held that in terms of the agreement entered into between the parties, it was agreed that dispute, if any, was to be resolved by appointment of an Arbitrator within the jurisdiction of Hamirpur, which was so done. Learned District Judge also held that said Court was not to re-appreciate the material adduced before the Arbitrato,r as the same was not the scope of Section 34 of the Act. On these bases, it decided Issue No.1 against the petitioner. With regard to Issue No.2, the same was decided in favour of the present respondent, so this Court is not dwelling upon qua the said issue. 7. Now, as far as the adjudication on the first Issue is concerned, this Court does not find any perversity in the findings returned therein by the learned District Judge. On a query put to the learned Deputy Advocate General as to what was the objection with regard to the appointment of the Arbitrator or his competence, learned Deputy Advocate General submitted that the Arbitrator was unilaterally appointed by the respondent. This Court is of the considered view that if that was the case, then, there were remedies available with the petitioner in terms of the provisions of the Arbitration and Conciliation Act, which admittedly were not resorted to. Not only this, the order passed by the learned District Judge demonstrates that the appellant submitted to the jurisdiction of the Arbitrator and appeared before the Arbitrator and contested the claim petition on merit. That being the case, the findings returned by the learned District Judge on Issue No.1 call for no interference on the competence or jurisdiction of the Arbitrator. 8.
That being the case, the findings returned by the learned District Judge on Issue No.1 call for no interference on the competence or jurisdiction of the Arbitrator. 8. As far as the contention of the learned Deputy Advocate General that learned District Judge did not appreciate the statement of PW-1 holistically or that the learned Arbitrator travelled beyond the scope of the agreement is concerned, this Court is of the considered view that this is not the scope either of under Section 34 or Section 37 of the Arbitration and Conciliation Act until and unless perversity is demonstrated as writ large on the face of the award itself, which obviously was not demonstrated by the present appellant before the learned District Judge. 9. This Court reiterates that in exercise of its power under Section 34 of the Arbitration Act, the Court is not to act as an appellant Court and re-appreciate the evidence etc. The scope of interference, as has been defined by the Hon’ble Supreme Court of India in terms of judgments referred in UHL Power Company Limited vs. State of Himachal Pradesh (supra) are that when parties have chosen to avail an alternate mechanism for dispute resolution, they must be left to reconcile themselves to the wisdom of the decision of the arbitrator and the role of the court should be restricted to the bare minimum. Interference will be justified only in cases of commission of misconduct by the Arbitrator, which can find manifestation in different forms, including exercise of legal perversity by the Arbitrator. Hon’ble Supreme Court has also held that the Courts should not interfere with an award merely because an alternative view on facts and interpretation of contract exists. The Courts need to be cautious and should defer to the view taken by the Arbitral Tribunal even if the reasoning provided in the award is implied unless such award portrays perversity unpardonable under Section 34 of the Arbitration Act. 10. As none of these conditions exit in the present case, therefore, as this Court does not find any reason to interfere with order dated 02.05.2025, passed by the learned District Judge, Hamirpur, H.P., the present appeal is dismissed. No order as to costs. 11. Pending miscellaneous applications, if any, also stand disposed of.