A Court deciding Section 34 petition has no jurisdiction to remand the matter to Arbitrator for Fresh Decision

The Supreme Court has reiterated that the court while deciding a petition under Section 34 of the Arbitration and Conciliation Act has no jurisdiction to remand the matter to the arbitrator for a fresh decision.

The said observation was made in the matter of Radha Chemicals Vs. Union of India Civil Appeal No. 10386 of 2018 (Arising out of SLP (C) No. 2334/2018) on 10.10.2018.

Challenge

The present appeal arose out of the order of the Calcutta High Court wherein the High Court while entertaining objections under Section 34 remanded the matter to the arbitrator in order to decide the point of limitation afresh.

Held

The Apex Court set aside both the judgments of Single Bench and Division Bench of the High Court while relying on the judgment of Kinnari Mullick and Another vs. Ghanshyam Das Damani, (2018) 11 SCC 328 wherein it was clearly held that the court while deciding a Section 34 petition has no jurisdiction to remand the matter to the Arbitrator for a fresh decision.

Upon a bare reading the current Arbitration Act with the Old Act, it becomes apparent that the power of remanding the matter for reconsideration by the arbitrator panel, as was available under Section 16(1) of the Old Act is now drastically curtailed in the current Act. However, an additional award can be permitted to be made upon application of a party, under Section 34 of the current Arbitration Act. Similarly, when a proceeding under Section 34 is pending, it can be adjourned by the Court to facilitate the Arbitral Tribunal to take steps to eliminate the grounds for setting aside the arbitral award.

The Bench further relegated the matter to the stage of the original Section 34 petition which had to be heard on merits and according to the parameters as laid down in Section 34 of the Act.