How can you appeal after the decision of the Arbitrator?

By Meher Sunil Dabrai

What is Arbitration?

Arbitration is a dispute resolution system. An Arbitration clause is usually included in the agreements of partnership firms or companies. If a dispute between the parties arises then the Arbitration clause can be invoked, and the one or more arbitrators are appointed and are given the power to negotiate or arbitrate between the parties and make binding decisions on the dispute in the form of arbitral awards.

When the parties choose arbitration, they opt for a private dispute resolution process instead of approaching the court. The parties to a contract usually insert an Arbitration clause in the contract. The clause basically means that in case of a dispute, the parties will appoint an arbitrator to resolve the dispute.

An Arbitration agreement is an essential element in such a contract. In case no such contract or agreement is made between two parties who are already in the middle of a dispute, the dispute can be referred to Arbitration by means of an Arbitration agreement between the parties if they mutually consent to the same.

The parties involved in Arbitration cannot unilaterally withdraw from it. At the end of the arbitration, the arbitral tribunal grants an order which is known as an “arbitral award”. This award is final and binding in the same manner as a final Judgement awarded by the Court.

Appeals in arbitration

Arbitration is essentially an alternate dispute resolution system which usually does not involve the Courts but under exceptional circumstances, a Court may be approached under the Arbitration and Conciliation Act, 1996 (hereinafter as Act).

An aggrieved party may approach the court only after an Arbitral award has been made or in case an order under Section 17 of the Act has been passed.

Section 17 of the Act states the Procedure for the parties to Arbitration to acquire interim reliefs from the arbitral tribunal during the pendency of the proceedings.

The parties are allowed to appeal to the Court only if such order or award has been made. A third party also has the remedy to appeal if the third party is directly or indirectly affected by such orders or awards.

Section 37 mentions the appealable order as follows:

The Court may hear appeals from the original decrees of the following orders:

  • Granting or refusing to grant any of the interim measures that may be sought under Section 9 of the Act.
  • Setting aside or refusing to set aside an arbitral award under Section 34 of the Act.
  • The Amendment Act widened the ambit of appeals under the Act. The appeal shall also lie to a court from the order granting of the arbitral tribunal.
  • Accepting the plea referred to in sub- section (2) or sub-section (3) of section 16 which may be challenging the jurisdiction or the scope of authority of the arbitral tribunal.
  • Granting or refusing to grant interim measures under Section 17.

Section 37(3) states that no second appeal shall lie from an order passed in appeal under the section and nothing in the section affects or takes away any right to appeal to the Supreme Court.

This simply means that if the first appeal is dismissed, a second appeal challenging the same order cannot be filed in the same court under the appellate jurisdiction states in the Arbitration Act but Section 37 does not take away any right to appeal to the Supreme Court to challenge an order of any other appellate Court.

Arbitration Appeals in the Supreme Court

Part II of the Supreme Court Rules 2013 refers to the Appellate Jurisdiction of the Supreme Court. Part IV of the Supreme Court Rules mentions the subject categories for which an appeal to the Supreme Court may be made.

Under this, Rule 11 includes Arbitration matters under the Appellate wing of the Supreme Court.

Apart from this, Part I of the Supreme Court Rules mentions that the memorandums of compromise or arbitral awards that eventually result in a court decree are a part of the Supreme Court record which are supposed to be a part of the record that is to be preserved permanently.

As mentioned hereinabove, Section 37 does not restrict the right to appeal to the Supreme Court in an Arbitral proceeding.

In recent times, the Supreme Court has passed several judgments under the Act. Some of these judgements are as follows:

  • Centrorade Minerals Vs. Hindustan Copper[1]

A three-judge Bench of the Supreme Court recently held that if the Arbitration agreement in the contract provided for a two-tiered arbitration; first in India which could be appealed by the unsatisfied party through a second Arbitration that was then to be conducted in London. Such a clause would not be contrary to the laws of the country and therefore, enforceable.

It appears that the scope of appeal in such cases is wider than the cases in Court. This means that the jurisdiction for an arbitral appeal can be widened by inserting such a clause in the Arbitration agreement itself.

  • MMTC Limited Vs. Anglo American Metallurgical Coal[2]

The Court held that as per the general principles of Section 37 the Court should forebear from interfering in the conclusions of inference that would be drawn by the Arbitral Tribunal even if it is upheld in proceedings under Section 34 and is not supported by plain, objective and clear reading of the documents.

The Court would not doubt in interfering or correcting such conclusion especially if it goes into the foundation of the matter.

  • Hyder Consulting Ltd. Vs. Governer, State of Orissa[3]

The Act of 1940 did not contain any specific provision dealing with the arbitrator’s power to grant interest. Further, it is a settled position that the decision of the Supreme Court regarding the award of interest made under the 1940 Act are not applicable the arbitrations held under the Act of 1996.

  • Alka Chandewar Vs. Shamshul Ishrar Khan[4]

The contention was that Section 9 and Section 17 were alternative remedies available to the parties before the Tribunal, if orders made under Section 17 were enforceable; the result of the provision would be rendered ineffective.

The Supreme Court negated the contention observing that such orders which would now be deemed to be orders of the Court for all purposes and would be enforceable under the Civil Procedure Code 1908 in the same manner as if they were orders of the Court in view of sub-section (2) to Section 17 that was added by the Amendment Act 2015.

Recent developments in Appeals after Arbitration

Union of India Vs. M/s Associated Construction Co.[5] is a recent case that is pending in the Hon’ble Supreme Court. It highlighted the uncertainty surrounding the limitation period applicable on appeals filed under Section 37 of the Arbitration and Conciliation Act 1996.

In Consolidated Engineering Enterprises Vs. Principal Secretary, Irrigation Department[6] the Supreme Court had held that the period of limitation for appeals under Section 37 of the Arbitration Act was governed by Article 116 of the Limitation Act 1963 which prescribes a 90-day limitation period for appeals to the High Court under the Code of Civil Procedure 1908.

Contradictory to this, Arbitration is a commercial dispute of a specified value and where such an Arbitration is not an international commercial Arbitration and all applications and appeals arising out of such Arbitral proceedings would ordinarily lie before any Principle Judge Of Original Jurisdiction in a District which should not be a High Court shall be decided by the Commercial Court.

Therefore, it was noted that the Commercial Courts Act under Section 13(1A) states that an appeal against the Judgement of a Commercial Court at the level of a District Judge or the Commercial Division of a High Court shall be filed within a period of 60 days from the date of the Judgement or order.

The decision in this matter is still keenly awaited as it is likely to settle the question and provide clarity to the litigants that approach the court under Section 37 of the Arbitration Act in the future.


Arbitration is an Alternative Dispute Resolution system which has recently gained popularity in commercial disputes in India. The rapid globalization has led to a need for such a dispute resolution system that is internationally recognized and is fast and efficient.

Arbitration had initially started as a procedure to avoid the troubles of litigation, but it was later realized that there has to be a remedy where the parties to Arbitration can approach a Court if they wish to challenge an arbitral award.

This would also make sure that there is a higher authority to the arbitral tribunal which also helped to resolve any loopholes in the process of Arbitration as it is still a newly developing system in the legal spectrum in India.


  1. Centrorade Minerals Vs. Hindustan Copper (Civil Appeal no. 2562 of 2006)
  2. MMTC Limited Vs. Anglo American Metallurgical Coal Special Leave Petition Civil No. 11431 of 2020
  3. Hyder Consulting Ltd Vs. Governor, State of Orissa AIR 2015 SC 856
  4. Alka Chandewar Vs. Shamshul Ishrar Khan AIR 2017 SC 756
  5. Union of India Vs. M/s Associated Construction Co Special Leave Petition No. 18079/2020
  6. Consolidated Engineering Enterprises Vs. Principal Secretary, Irrigation Department (2008) 7 SCC 169

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