Arbitration : Supreme Court Explains Role of High Court in Interfering in Arbitral Matters

Arbitration : Supreme Court Explains Role of High Court in Interfering in Arbitral Matters

In the case of Deep Industries Ltd. vs ONGC Ltd., [2019] GCtR 6501 (SC), the Supreme Court took a view that Article 227 being a constitutional provision does not get impacted with the non obstante clause of Section 5 of the Arbitration and Conciliation Act, 1996 but the High Court dealing with the orders allowing or dismissing of the appeals under Section 37 of the A&C Act, 1996 would be extremely circumspect in interfering with the same, taking into account the statutory policy so that interference is restricted to orders that suffer patent lack of jurisdiction. 

The phrase used was "High Court would be extremely circumspect in interfering with the same" and in matters where Orders under challenge are those "patently lacking in inherent jurisdiction".

Most significant of all is the non-obstante clause contained in Section 5 of A&C Act, 1996 which states that notwithstanding anything contained in any other law, in matters that arise under Part I of the Arbitration Act, no judicial authority shall intervene except where so provided in this Part. Section 37 of A&C Act, 1996 grants a constricted right of first appeal against certain judgments and orders and no others. Further, the statutory mandate also provides for one bite at the cherry, and interdicts a second appeal being filed (See Section 37(2) of the Act).

Entering into the general thicket of disputes between the parties does not behove a court exercising jurisdiction under Article 227, where only jurisdictional errors can be corrected.

It was held that legislative policy qua the general revisional jurisdiction that is contained by the amendments made to Section 115 of Code of Civil Procedure, 1908 should also be kept in mind when High Courts dispose of petitions filed under under article 227. No revision lies if an alternative remedy of appeal is available. Further, even when a revision does lie, it lies only against a final disposal of the entire matter and not against interlocutory orders.