09 September 2021 | Delhi Airport Metro Express Pvt. Ltd. v. Delhi Metro Rail Corporation Ltd. | Civil Appeal No. 5627 of 20219 | L Nageswara Rao and S Ravindra Bhat JJ | Supreme Court of India | 2021 SCC OnLine SC 695
A 2-judge bench of the Supreme Court has attempted to explain how the set-aside grounds under Section 34 ACA should be applied. It has termed it “a disturbing tendency” that the set-aside courts dissect and reassess facts to conclude that an award needs intervention and then dub it as either perverse, patently illegal, or apply other grounds.
It further said that this approach “would lead to corrosion of the object of the 1996 Act and the endeavours made to preserve this object, which is minimal judicial interference with arbitral awards” and several decisions of the Supreme Court becoming a dead letter.
Then attempting to describe patent illegality, the court said it is “illegality which goes to the root of the matter.” In other words, the following is not an example of patent illegality:
The court also explains what patent illegality is:
In deciding patent illegality what is not permitted:
The court also considered the public policy ground and its ingredients, that is, “an award would be in conflict with public policy of India only when it is induced or affected by fraud or corruption or is in violation of Section 75 or Section 81 of the 1996 Act, if it is in contravention with the fundamental policy of Indian law or if it is in conflict with the most basic notions of morality or justice.”
Considering these expressions, the court said that
Read the decision here.
Categories: 2015 Amendments | Application for Setting Aside Arbitral Award | Arbitrators Interpretation of Contract | Erroneous Application of Law | Fundamental Policy of Indian Law | Most Basic Notions of Morality or Justice | Perverse Award | Public Policy of India | Renusagar | Section 34 (2) (b) (ii) ACA | Section 34 (2A) | Setting Aside Arbitral Award | Ssangyong | Standard for Setting Aside Arbitral Award