Seema Gupta v. Sunny Talwani

82. Issue of non-arbitrability can be raised at three stages. First, before the court on an application for reference under Section 11 or for stay of pending judicial proceedings and reference under Section 8 of the Arbitration Act; secondly, before the Arbitral Tribunal during the course of the arbitration proceedings; or thirdly, before the court at the stage of the challenge to the award or its enforcement. Therefore, the question — ―Who decides non-arbitrability?‖ and, in particular, the jurisdiction of the court at the first look stage, that is, the referral stage.‖ d. N.N. Global Mercantile (P) Ltd. v. Indo Unique Flame Ltd.,

―45. The civil aspect of fraud is considered to be arbitrable in contemporary arbitration jurisprudence, with the only exception being where the allegation is that the arbitration agreement itself is vitiated by fraud or fraudulent inducement, or the fraud goes to the validity of the underlying contract, and impeaches the arbitration clause itself…

46. The civil aspect of fraud can be adjudicated by an Arbitral Tribunal…‖

15. Further, the second challenge to the impugned Award is that the Award is in conflict with the public policy of India and is also patently illegal. Reliance has been placed upon Ssangyong Engineering and Construction Company Limited vs. NHAI, (2019) 15 SCC 131, Patel Engineering Limited vs. North Eastern Electric Power Corporation Ltd., (2020) 7 SCC 167 and Delhi Airport Metro Express Ltd. vs. Delhi Metro Rail Corporation Ltd., (2021) 1 SCC 131 to submit that where an Award suffers from patent illegality, it is liable to be set aside.

16. It is submitted that a criminal complaint dated 10th April 2017 has also been filed against Surinder Wadhwa and his associates, including the defendant herein under Sections 420, 406, 467, 468, 471 and 120-B of the Indian Penal Code, 1860. The said complaint was registered as an FIR bearing No. 27/2018 on 7th February 2018. However, the learned Arbitrator has not considered the same while allowing Claim No. 1 in favour of the respondent and did not even discuss the criminal proceedings.

17. It is further submitted that the learned Arbitrator granted the relief of specific performance of a contract in the absence of readiness and willingness as stipulated under the Specific Relief Act, 1963. It is submitted that this Court as well as the Hon’ble Supreme Court in various pronouncements categorically held that, the words “ready” and “willing” imply that the person was prepared to carry out the terms of the contact. Reliance has been placed upon the judgment of N.P. Thirugnanam vs. Dr. R. Jagan Mohan Rao, (1995) 5 SCC 115 to give force to this argument. However, the Respondent was never ready and willing to satisfy his part in accordance with the alleged Agreement to Sell dated 26th October 2015 as Clause 2 of the alleged Agreement to Sell stipulated that the respondent shall make the balance payment of Rs. 20,00,000/within a period of six months from the date the alleged Agreement to Sell was signed. It is submitted that the accounts statements of the respondent show that he never processed requisite funds to make payment for the balance consideration. Moreover, the specific performance is a discretionary relief which need not be necessarily granted. Therefore, the observation of the learned Arbitrator regarding readiness and willingness on the part of the respondent is erroneous.

18. Therefore, it is prayed that the impugned Award be set aside. Submissions on behalf of the respondent

19. Per Contra, the learned counsel for the respondent vehemently opposed the instant petition and submitted that there is no error in the impugned Award passed in the arbitration proceedings between the parties.

20. The learned counsel presented the respondent’s version of the facts and submitted that the petitioner approached the respondent, through her husband Mr. Amrish Gupta, and represented that she is sole, legal and absolute owner of property in question situated in revenue estate of Village Jonapur, Tehsil Mehrauli, New Delhi. After due negotiations and deliberations, the sale consideration amount was settled as Rs. 60 lakhs and it is decided between the parties that an amount of Rs. 40 lakhs would be paid at the time of execution of Agreement to Sell and balance sale consideration amount of Rs. 20 lakhs would be paid within a period of six months from the date of the Agreement to Sell. It was also agreed between the parties that the First Party, the petitioner herein, shall get the mutation of the property done in favor of Second Party, the respondent before this Court. It is submitted that based upon the representations and assurances, the respondent agreed to enter into the Agreement to Sell with the petitioner.

21. It is submitted that out of total sale consideration, the part payment of Rs. 40 lakhs was paid through UTR No. BARBR52015102600767457 dated 26th October 2015 through Bank of Baroda, Shalimar Bagh, New Delhi, by the respondent. The said Agreement was duly executed out of free will and with consent of both the parties. However, the petitioner has raised the objection to the existence of the Agreement.

22. The respondent has offered Rs. 20 lakhs to the petitioner at several occasions, however, the petitioner was not coming forward for the execution of Agreement to Sell. The respondent has been and is still ready and willing to pay balance sale consideration amount of Rs. 20 lakhs to the petitioner subject to the petitioner executing the Sale Deed in favor of respondent. It is submitted that the learned Arbitrator duly noted the financial capacity of the respondent, pari delicto relations of the party and then passed the finding regarding the readiness and willingness to perform.

23. It is submitted that Clause 7 of the Agreement to Sell clearly stipulates that in case if any party hereto infringes any of the terms and conditions of the agreement to sell, the other party shall be entitled to get this transaction enforced through specific performance of the contract at the costs and expenses of the defaulting party. Therefore, the observation of the learned Arbitrator after due consideration of the validity of Agreement for specific performance of the Agreement was in accordance with the law as well as facts of the case.

24. The Clause 15 of the Agreement to Sell stipulates an Arbitration Clause and provides that in case of any dispute arising out of or in connection with this agreement, the same shall be referred to sole Arbitration of Mr. Vineet Malhotra. Accordingly, when the dispute regarding remaining consideration amount arose, the respondent invoked the Arbitration Clause and sought to initiate arbitration proceedings.

25. The petitioner raised objections qua the possession of the property. To this this effect, it is submitted that though the Agreement mentions that the possession/original title deed of the said property was handed over to the respondent, however, the correct facts are that the petitioner requested for some time for handing over the possession, as the property has to be surveyed by the concerned department for obtaining necessary permissions for NOC and believing the request of petitioner to be bona fide, the respondent agreed for the same and the possession of the property remained with the petitioner. The respondent was assured by the petitioner that she has already initiated the process of obtaining the necessary permissions/NOC and will soon register the transfer document in favor of respondent, however, the petitioner never took the necessary steps. It is submitted that the petitioner delayed the execution of the Agreement on one or another pretext. The petitioner also represented that the sale deed would be registered in the name of the respondent on or before January 2017, however, the petitioner has failed to get the sale deed registered in favor of respondent and hence, the Arbitration Clause was invoked.

26. It is also submitted that the petitioner purchased the property in question for Rs. 28 lakhs and the consideration for the Agreement to Sell in question is Rs. 60 lakhs, which is more than double the purchase amount. Therefore, there arises no objection to this issue. The issue has also been discussed by the learned Arbitrator in the impugned Award.

27. To the objections raised on behalf of the petitioner regarding the findings of the learned Arbitrator, the learned counsel for the respondent submitted that the learned Arbitrator gave the parties were proper opportunity to lead their documentary as well as oral, which was duly led and only thereafter passed the finding granting Claim No. 1 in favour of the respondent. It is submitted that the Agreement to Sell in question was prepared on the Stamp Paper which is in the name of the petitioner. Moreover, the learned Arbitrator in paragraphs no. 26, 27, 28, 29, 31, 32, 34, 35 and paragraph no. (ii), (iii), (iv), (v) & (xv) of the Award, discussed the issue of genuineness of the Agreement to Sell in question and analysed the evidence/material extensively, including the affixation of signatures of Mrs. Seema Gupta on the Agreement to Sell, before allowing the specific performance of the Agreement.

28. It is submitted that the petitioner never raised the plea of alibi in the Statement of Defence or even while adducing evidence by way of the affidavit of RW-1, Amrish Gupta and RW-2, Seema Gupta. At the fag end of proceedings before the learned Arbitrator, an application came to be filed by the petitioner to examine Dr. N.K. Kaushal, which was allowed on 4th December 2018. Dr. N.K. Kaushal was examined as RW-

3. No original prescription was produced. No fee bill was examined. During the course of oral arguments as well, it was admitted by petitioner’s counsel that the doctor was known to him. Therefore, the petitioner failed to establish that she was not present at the time of execution of the Agreement.

29. The learned Arbitrator made specific observations to this effect and found that the plea was not taken at any earlier stage. To support the argument, the learned counsel referred to the evidence of the petitioner. Reliance has also been placed on the judgment passed in Mohinder Singh vs. State, AIR 1953 SC 415 whereby the Hon’ble Supreme Court held that the standard of proof required in regard to a plea of alibi must be the same as the standard applied to the prosecution evidence and in both cases it should be a beyond reasonable doubt. Further, in Lakhan Singh @ Pappu vs. the State of NCT of Delhi, Crl Appeal No. 166/1999, this Court held that the plea of alibi cannot be equated with a plea of selfdefence and ought to be taken at the first instance and not belatedly at the stage of defence evidence. In any case, the appellant/accused gives no reason or explanations for not taking this plea of alibi at the earliest opportunity. Therefore, there is no force in the argument of the petitioner to this effect.

30. It is submitted that it has been argued on behalf of the petitioner that there have been several cross-loan transactions between, however, the husband of the petitioner, during his cross-examination, clarified that there is no transaction between the parties. Moreover, the Bank Account Statement or the Financial Statements of the petitioner herein do not display any repayment of loan or any payment of interest on loan and moreover, if the same has been treated as a loan transaction by the petitioner, then due diligence under Section 194A of Income Tax Act, 1961 has not been made.

31. The learned counsel submitted the scope of enquiry in the proceedings under Section 34 of the Arbitration Act is restricted to a consideration whether any of the grounds mentioned in Section 34(2) or Section 13(5) or Section 16(6) of the Act are made out to set aside the award. The grounds for setting aside the award are specific. It is imperative for expeditious disposal of cases under Section 34 of the Arbitration Act be decided only with reference to the pleadings and the evidence placed before the arbitral tribunal and the limited grounds specified under Section 34(2) of the Act.

32. In the present case, the petitioner has failed to raise and establish grounds as enumerated under Section 34(2) of the Arbitration Act. The Award is a well-reasoned and speaking Award not warranting any interference from this Court. Therefore, the instant petition is liable to be dismissed for being devoid of merit.

33. Heard the learned counsel for the parties at length and perused the record.

FINDINGS AND ANALYSIS

34. The petitioner has assailed the Award dated 30th September 2019 passed by the learned Arbitrator, which has been thoroughly perused and considered by this Court. After hearing the parties at length and perusing the record, this Court deems it necessary to narrow down the controversy and dispute between the parties to the following questions:-

I. What is the scope of the jurisdiction of the Arbitrator as well as of the interference of this Court while adjudicating a petition under Section 34 of the Arbitration Act.

II. Whether the learned Arbitrator has considered the objections raised on behalf of the petitioner regarding the execution of the Agreement to Sell while considering the grant of relief of specific performance.

III. Whether the grounds stipulated under Section 34 of the

Arbitration Act have been satisfied to set aside the impugned Award in the instant matter. Accordingly, this Court shall delve into the adjudication upon the aforesaid issues.

35. Before adjudicating upon the merits of the case, it is essential to recapitulate the idea, purpose, goal and objective of the Arbitration Act as well as Section 34 of the Arbitration Act to understand the implications the provisions therein have on the powers and jurisdiction of this Court.

36. The Arbitration Act was enacted for providing a mechanism to the public to resolve their disputes in a process less rigorous, technical and formal than that of a litigation. It has proven to be easier, more accessible, efficient and even cost effective for the parties involved, whether at an individual level or at the level of a business or corporation. The alternative dispute mechanism is not only advantageous for the people involved in disputes but has also been aiding the effective disposal and release of burden on the Courts of the Country. The parties have a more hands-on involvement in an Arbitration process and play an active role in the adjudication process.

37. The Hon’ble Supreme Court in Union of India vs. Varindera Constructions Ltd., (2018) 7 SCC 794, while discussing the object of arbitration held as under:- ―12. The primary object of the arbitration is to reach a final disposition in a speedy, effective, inexpensive and expeditious manner. In order to regulate the law regarding arbitration, legislature came up with legislation which is known as Arbitration and Conciliation Act, 1996. In order to make arbitration process more effective, the legislature restricted the role of courts in case where matter is subject to the arbitration. Section 5 of the Act specifically restricted the interference of the courts to some extent. In other words, it is only in exceptional circumstances, as provided by this Act, the court is entitled to intervene in the dispute which is the subject-matter of arbitration. Such intervention may be before, at or after the arbitration proceeding, as the case may be. In short, court shall not intervene with the subjectmatter of arbitration unless injustice is caused to either of the parties.‖

38. Therefore, expeditious and effective disposal of matters are most certainly considered the primary objectives of the enactment of the Arbitration Act. To fulfil the objective of introducing the Arbitration Act, it has been deemed necessary by the legislature as well as the Hon’ble Supreme Court to limit interference by the Courts in the process of arbitration, whether before, during or after the conclusion of the proceedings.

39. The petitioner before this Court has invoked Section 34 of the Arbitration Act to challenge the impugned Award. The relevant portion of the said provision is reproduced hereunder for perusal and consideration:- ―34. Application for setting aside arbitral award.— (1) Recourse to a Court against an arbitral award may be made only by an application for setting aside such award in accordance with sub-section (2) and sub-section (3). (2) An arbitral award may be set aside by the Court only if— (a) the party making the application establishes on the basis of the record of the arbitral tribunal that—

(i) a party was under some incapacity, or

(ii) the arbitration agreement is not valid under the law to which the parties have subjected it or, failing any indication thereon, under the law for the time being in force; or

(iii) the party making the application was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present his case; or

(iv) the arbitral award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration: Provided that, if the decisions on matters submitted to arbitration can be separated from those not so submitted, only that part of the arbitral award which contains decisions on matters not submitted to arbitration may be set aside; or arbitral award which contains decisions on matters not submitted to arbitration may be set aside; or

(v) the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties, unless such agreement was in conflict with a provision of this Part from which the parties cannot derogate, or, failing such agreement, was not in accordance with this Part; or (b) the Court finds that—

(i) the subject-matter of the dispute is not capable of settlement by arbitration under the law for the time being in force, or

(ii) the arbitral award is in conflict with the public policy of India.

[Explanation 1.—For the avoidance of any doubt, it is clarified that an award is in conflict with the public policy of India, only if,—

(i) the making of the award was induced or affected by fraud or corruption or was in violation of section 75 or section 81; or

(ii) it is in contravention with the fundamental policy of Indian law; or

(iii) it is in conflict with the most basic notions of morality or justice.

Explanation 2.—For the avoidance of doubt, the test as to whether there is a contravention with the fundamental policy of Indian law shall not entail a review on the merits of the dispute.] [(2A) An arbitral award arising out of arbitrations other than international commercial arbitrations, may also be set aside by the Court, if the Court finds that the award is vitiated by patent illegality appearing on the face of the award: Provided that an award shall not be set aside merely on the ground of an erroneous application of the law or by reappreciation of evidence.] …‖

40. The contents of the provision clearly show that the intention of legislature while enacting the Arbitration Act, as well as while carrying out amendments to the same, was that there should be limited intervention of the Courts in arbitral proceedings, especially after the proceedings have been concluded and an Award thereto has been made by the concerned Arbitral Tribunal. Any claim brought forth a Court of law under Section 34 of the Arbitration Act shall be in accordance with the principle of the provisions laid down under the Arbitration Act as well as interpreted by the Hon’ble Supreme Court.

41. The Law Commission of India in its 246th Report has also elaborated upon the background of introducing Section 34 of the Arbitration Act and laid down as under:- ―3. The Arbitration and Conciliation Act, 1996 (hereinafter "the Act") is based on the UNCITRAL Model law on International Commercial Arbitration, 1985 and the UNCITRAL Conciliation Rules, 1980. The Act has now been in force for almost two decades, and in this period of time, although arbitration has fast emerged as a frequently chosen alternative to litigation, it has come to be afflicted with various problems including those of high costs and delays, making it no better than either the earlier regime which it was intended to replace; or to litigation, to which it intends to provide an alternative. Delays are inherent in the arbitration process, and costs of arbitration can be tremendous. Even though courts play a pivotal role in giving finality to certain issues which arise before, after and even during an arbitration, there exists a serious threat of arbitration related litigation getting caught up in the huge list of pending cases before the courts. After the award, a challenge under Section 34 makes the award inexecutable and such petitions remain pending for several years. The object of quick alternative disputes resolution frequently stands frustrated.

4. There is, therefore, an urgent need to revise certain provisions of the Act to deal with these problems that frequently arise in the arbitral process. The purpose of this Chapter is to lay down the foundation for the changes suggested in the Report of the Commission. The suggested amendments address a variety of issues that plague the present regime of arbitration in India and, therefore, before setting out the amendments, it would be useful to identify the problems that the suggested amendments are intended to remedy and the context in which the said problems arise and hence the context in which their solutions must be seen.

25. Similarly, the Commission has found that challenges to arbitration awards under Sections 34 and 48 are similarly kept pending for many years. In this context, the Commission proposes the addition of Sections 34(5) and 48(4) which would require that an application under those sections shall be disposed of expeditiously and in any event within a period of one year from the date of service of notice. In the case of applications under Section 48 of the Act, the Commission has further provided a time-limit under Section 48(3), which mirrors the time-limits set out in Section 34(3), and is aimed at ensuring that parties take their remedies under this section seriously and approach a judicial forum expeditiously, and not by way of an afterthought.‖

42. With the repeal of Arbitration Act of 1940 by way of Arbitration Act, 1996, the legislature sought to achieve the objective of reducing the supervisory role of courts in arbitration proceedings. The amendment of Section 34 was also to have the Courts readily and expeditiously adjudicate upon any proceedings arising out of arbitration proceedings. The challenge to an Award also must be disposed of as expeditiously possible by the Courts.

43. It is clear that the speed and efficiency of disposal of disputes between parties are few of the substantial and key purposes of the introduction, development and promotion of resolving disputes by way of alternate mechanisms of dispute resolution.

44. Hence, the objective, goal and purpose of the Act as well as the intention of the legislature have to be given due consideration while adjudicating a petition under Section 34 of the Arbitration Act. Scope of Powers of Arbitrator & Intervention of Courts

45. The Arbitrator, who in his wisdom, passes an Award, upon conducting the arbitration proceedings with the participation of parties to the dispute, considering the Statement of Claim and Statement of Defence presented by and on behalf of the parties, the relevant documents placed on record by the parties, is considered a Court for the purposes of adjudicating the dispute before him. An unfettered intervention in his functioning would defeat the spirit and purpose of the Arbitration Act, as discussed in the foregoing paragraphs.

46. An Arbitrator has wide powers while adjudicating arbitration proceedings. There is, undoubtedly, a scrutiny on the Arbitrator and the Awards passed by him, which has been stipulated under the Arbitration Act. However, there is a deemed privilege of limited intervention from the Courts which the Arbitrators have. The same has been reiterated by the Hon’ble Supreme Court time and again.

47. There is an extent to the accountability put upon an Arbitrator while passing an Award. This is evident from the fact that with the enforcement of the Arbitration and Conciliation Act, 1996, an Arbitrator needs only to adhere to and fulfil the requirements under Section 31 of the Act. The limited requirements under Section 31 are reproduced hereunder:- ―Form and contents of arbitral award. – (1) An arbitral award shall be made in writing and shall be signed by the members of the arbitral tribunal. (2) For the purposes of sub-section (1), in arbitral proceedings with more than one arbitrator, the signatures of the majority of all the members of the arbitral tribunal shall be sufficient so long as the reason for any omitted signature is stated. (3) The arbitral award shall state the reasons upon which it is based, unless— (a) the parties have agreed that no reasons are to be given, or (b) the award is an arbitral award on agreed terms under section 30 (4) The arbitral award shall state its date and the place of arbitration as determined in accordance with section 20 and the award shall be deemed to have been made at that place. (5) After the arbitral award is made, a signed copy shall be delivered to each party. (6) The arbitral tribunal may, at any time during the arbitral proceedings, make an interim arbitral award on any matter with respect to which it may make a final arbitral award. …‖

48. In addition to the requirements laid down under the provision, an Arbitrator, although acting in accordance with the requirements of the Arbitration Act, need not act as a formal Court while adjudicating a dispute and pass an Award which is lengthy, detailed or speaking. The Hon’ble Supreme Court has reiterated that an Award which is not speaking shall be set aside by the Court only in exceptional cases.

49. In Anand Brothers (P) Ltd. vs. Union of India & Ors., (2014) 9 SCC 212, the Hon’ble Supreme Court on the question of a reasoned or speaking Award observed and held as under:- ―7. Before we examine whether the expression ''finding" appearing in Clause 70 would include reasons in support of the conclusion drawn by the arbitrator, we consider it appropriate to refer to the Constitution Bench decision of this Court in Raipur Development Authority v. Chokhamal Contractors wherein this Court was examining whether an award without giving reasons can be remitted or set aside by the Court in the absence of any stipulation in the arbitral agreement obliging the arbitrator to record his reasons. Answering the question in the negative, this Court held that a nonspeaking award cannot be set aside except in cases where the parties stipulate that the arbitrator shall furnish reasons for his award. This Court held: (SCC pp. 750-51, para 33) ―33.... When the parties to the dispute insist upon reasons being given, the arbitrator is, as already observed earlier, under an obligation to give reasons. But there may be many arbitrations in which parties to the dispute may not relish the disclosure of the reasons for the awards. In the circumstances and particularly having regard to the various reasons given by the Indian Law Commission for not recommending to the Government to introduce an amendment in the Act requiring the arbitrators to give reasons for their awards we feel that it may not be appropriate to take the view that all awards which do not contain reasons should either be remitted or set aside.‖ Having said that, this Court declared that the Government and their instrumentalities should-as a matter of policy and public interest-if not as a compulsion of law, ensure that whenever they enter into an agreement for resolution of disputes by way of private arbitrations, the requirement of speaking awards is expressly stipulated and ensured. Any laxity in that behalf might lend itself to and, perhaps justify the legitimate criticism, that the Government failed to provide against possible prejudice to public interest.

8. The following passage is in this regard apposite: (Raipur Development Authority case, SCC pp. 752-53, para 37) ―37. There is, however, one aspect of non-speaking awards in non-statutory arbitrations to which Government and governmental authorities are parties that compel attention. The trappings of a body which discharges judicial functions and is required to act in accordance with law with their concomitant obligations for reasoned decisions, are not attracted to a private adjudication of the nature of arbitration as the latter, as we have noticed earlier, is not supposed to exert the State's sovereign judicial power. But arbitral awards in disputes to which the State and its instrumentalities are parties affect public interest and the matter of the manner in which Government and its instrumentalities allow their interest to be affected by such arbitral adjudications involve larger questions of policy and public interest. Government and its instrumentalities cannot simply allow large financial interests of the State to be prejudicially affected by non-reviewable---except in the limited way allowed by the statute-non-speaking arbitral awards. Indeed, this branch of the system of dispute resolution has, of late, acquired a certain degree of notoriety by the manner in which in many cases the financial interests of Government have come to suffer by awards which have raised eyebrows by doubts as to their rectitude and propriety. It will not be justifiable for Governments or their instrumentalities to enter into arbitration agreements which do not expressly stipulate the rendering of reasoned and speaking awards. Governments and their instrumentalities should, as a matter of policy and public interest-if not as a compulsion of law-ensure that wherever they enter into agreements for resolution of disputes by resort to private arbitrations, the requirement of speaking awards is expressly stipulated and ensured. It is for Governments and their instrumentalities to ensure in future this requirement as a matter of policy in the larger public interest. Any lapse in that behalf might lend itself to and perhaps justify, the legitimate criticism that Government failed to provide against possible prejudice to public interest.‖

9. Reference may also be made to the Arbitration and Conciliation Act, 1996 which has repealed the Arbitration Act, 1940 and which seeks to achieve the twin objectives of obliging the Arbitral Tribunal to give reasons for its arbitral award and reducing the supervisory role of courts in arbitration proceedings. Section 31(3) of the said Act obliges the Arbitral Tribunal to state the reasons upon which it is based unless the parties have agreed that no reasons be given or the arbitral award is based on consent of the parties. There is, therefore, a paradigm shift in the legal position under the new Act which prescribes a uniform requirement for the arbitrators to give reasons except in the two situations mentioned above. The change in the legal approach towards arbitration as an alternative dispute resolution mechanism is perceptible both in regard to the requirement of giving reasons and the scope of interference by the court with arbitral awards. While in regard to requirement of giving reasons the law has brought in dimensions not found under the old Act, the scope of interference appears to be shrinking in its amplitude, no matter judicial pronouncements at time appear to be heading towards a more expansive approach that may appear to some to be opening up areas for judicial review on newer grounds falling under the caption ―public policy‖ appearing in Section 34 of the Act. We are referring to these developments for it is one of the well-known canons of interpretation of statutes that when an earlier enactment is truly ambiguous in that it is equally open to diverse meanings, the later enactment may in certain circumstances serve as the parliamentary exposition of the former.

14. It is trite that a finding can be both: a finding of fact or a finding of law. It may even be a finding on a mixed question of law and fact. In the case of a finding on a legal issue the arbitrator may on facts that are proved or admitted explore his options and lay bare the process by which he arrives at any such finding. It is only when the conclusion is supported by reasons on which it is based that one can logically describe the process as tantamount to recording a finding. It is immaterial whether the reasons given in support of the conclusion are sound or erroneous. That is because a conclusion supported by reasons would constitute a "finding" no matter the conclusion or the reasons in support of the same may themselves be erroneous on facts or in law. It may then be an erroneous finding but it would nonetheless be a finding. What is important is that a finding presupposes application of mind. Application of mind is best demonstrated by disclosure of the mind; mind in turn is best disclosed by recording reasons. That is the soul of every adjudicatory process which affects the rights of the parties….‖

50. Therefore, while considering a challenge to an Arbitral Award where private parties are involved, the Court need not examine the validity of the findings or the reasoning behind the findings given by an Arbitrator. The extent to which a Court may exercise supervisory powers in this respect is limited to examining whether the Award and the conclusion drawn therein is supported by findings and not whether the findings themselves are erroneous or sound.

51. It has also been reiterated that, while adjudicating a challenge under Section 34 of the Arbitration Act, the Courts must limit themselves to examining the Award itself and not the facts of the case. A Court shall not conduct a roving enquiry into the facts and evidence of the matter and neither shall the Court sit in appeal against the Award of the Arbitrator.

52. In UHL Power Co. Ltd. vs. State of Himachal Pradesh, (2022) 4 SCC 116, the Hon’ble Supreme Court reiterated the narrow scope under Section 34 of the Arbitration Act and held as under:- ―16. As it is, the jurisdiction conferred on courts under Section 34 of the Arbitration Act is fairly narrow, when it comes to the scope of an appeal under Section 37 of the Arbitration 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. In MMTC Ltd. v. Vedanta Ltd. 5, the reasons for vesting such a limited jurisdiction on the High Court in exercise of powers under Section 34 of the Arbitration Act have been explained in the following words: (SCC pp. 166-67, para 11) ―11. As far as Section 34 is concerned, the position is well-settled by now that the Court does not sit in appeal over the arbitral award and may interfere on merits on the limited ground provided under Section 34(2)(b)(ii) i.e. if the award is against the public policy of India. As per the legal position clarified through decisions of this Court prior to the amendments to the 1996 Act in 2015, a violation of Indian public policy, in turn, includes a violation of the fundamental policy of Indian law, a violation of the interest of India, conflict with justice or morality, and the existence of patent illegality in the arbitral award. Additionally, the concept of the "fundamental policy of Indian law" would cover compliance with statutes and judicial precedents, adopting a judicial approach, compliance with the principles of natural justice, and Wednesbury[6] reasonableness. Furthermore, "patent illegality" itself has been held to mean contravention of the substantive law of India, contravention of the 1996 Act, and contravention of the terms of the contract.‖

17. A similar view, as stated above, has been taken by this Court in K. Sugumar v. Hindustan Petroleum Corpn. Ltd. 7, wherein it has been observed as follows: (SCC p. 540, para

2) ―2. The contours of the power of the Court under Section 34 of the Act are too well established to require any reiteration. Even a bare reading of Section 34 of the Act indicates the highly constricted power of the civil court to interfere with an arbitral award. The reason for this is obvious. 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.‖

53. In Delhi Airport Metro Express Pvt Ltd vs. Delhi Metro Rail Corporation, (2022) 1 SCC 131, the Hon’ble Supreme Court to this aspect held as under:- ―28. The limited grounds available to Courts for annulment of arbitral awards are well known to legally trained minds. However, the difficulty arises in applying the well established principles for interference to the facts of each case that come up before the courts. There is a disturbing tendency of Courts of setting aside arbitral awards, after dissecting and reassessing factual aspects of the cases to come to a conclusion that the award needs intervention and thereafter, dubbing the award to be vitiated by either perversity or patent illegality, apart from the other grounds available for annulment of the award.‖

54. Further, in State of Jharkhand vs. HSS Integrated DSN, (2019) 9 SCC 798, the Hon’ble Supreme Court held that even when there are more than one plausible views and the Arbitrator, in his wisdom, adopts one of them, having given reasons for his findings, the Courts shall not interfere with such an Award. It was observed as under:- ―6.1. In Progressive-MVR[3], after considering the catena of decisions of this Court on the scope and ambit of the proceedings under Section 34 of the Arbitration Act, this Court has observed and held that even when the view taken by the arbitrator is a plausible view, and/or when two views are possible, a particular view taken by the Arbitral Tribunal which is also reasonable should not be interfered with in a proceeding under Section 34 of the Arbitration Act.

6.2. In Datar Switchgear Ltd., this Court has observed and held that the Arbitral Tribunal is the master of evidence and the findings of fact which are arrived at by the arbitrators on the basis of the evidence on record are not to be scrutinised as if the Court was sitting in appeal. In para 51 of the judgment, it is observed and held as under: (SCC pp. 169-70) ―51. ….. The proposition of law that the Arbitral Tribunal is the master of evidence and the findings of fact which are arrived at by the arbitrators on the basis of evidence on record are not to be scrutinised as if the Court was sitting in appeal now stands settled by a catena of judgments pronounced by this Court without any exception thereto.‖

55. Hence, the law which has been settled by the Hon’ble Supreme Court is that the scope of interference with an Arbitral Award under Section 34 of the Arbitration Act is fairly limited and narrow. The Courts shall not sit in an appeal while adjudicating a challenge to an Award which is passed by an Arbitrator, the master of evidence, after due consideration after facts, circumstances, evidence and material before him.

56. Therefore, it is clear that this Court shall also limit itself to the Award in question and not re-appreciate evidence and all material before the Arbitrator.

ISSUE NO. II

57. The foremost ground raised on behalf of the petitioner is that the findings of the learned Arbitrator qua the specific performance of the Agreement to Sell dated 26th October 2015 are erroneous since the learned Arbitrator failed to consider that the same was a forged and fabricated document, never executed by the petitioner.

58. To this extent the arguments which have been detailed above are reiterated to sum up the objections to be considered while adjudicating the instant issue. a. The petitioner claimed that she had not signed the Agreement to Sell. b. The petitioner took the plea of alibi and stated that she was not in the City when the alleged Agreement to Sell was purported to be signed. c. It was argued that the consideration for the Agreement was in fact the amount for cross-loan transactions between the parties.

59. It has been averred on behalf of the petitioner that the learned Arbitrator did not consider the said aspects while granting the relief of specific performance of contract. Therefore, it is pertinent to reproduce and look into the findings of the learned Arbitrator. The same are discussed hereunder.

60. The petitioner raised the objection of the Agreement to Sell before the learned Arbitrator, which has been raised before this Court as well. To this issue the learned Arbitrator as under:- ―Claim No.1 Decree for specific performance of Agreement to Sell dated 26.10.2015, against the Respondent for execution of sale deed of property in question. i. For consideration of relief of specific performance, the first question to be determined is whether the Agreement to Sell dated 26.10.2015, was executed between the parties? This is because Respondent claims it to be forged and fabricated. While referring the dispute to arbitration, 'the above issue including all others had been left open for adjudication by the arbitrator. To prove execution of Agreement to Sell, Claimant produced original Agreement to Sell (Ex-CW 1/ A) with proof of payment of part sale consideration of Rs.40,00,000/- through banking channel. As noted earlier, Claimant deposed regarding Respondent's husband proposal to sell the agricultural land for the total sale consideration of Rs.60,00,000/- being agreed with Rs.40,00,000/- being paid at the time of execution of the Agreement to Sell. Claimant deposed as to due execution of Agreement to Sell dated 26.10.2015 and proved the due execution by parties. Conjoint reading of his answers to question nos. (4, 6 and 20-22) of his cross examination affirm the execution. Ownership of land in question is not disputed. He categorically stated to have paid Rs. 40,00,000/- through banking channel as recorded in the Agreement and receipt of the said amount is duly admitted by the Respondent albeit falsely claimed as loan. ii. Claimant's testimony was further supported by the attesting witness CW-2, Ran Vijay Singh who also deposed that Claimant and Respondent had executed the agreement. Mr. Ran Vijay Singh verified Respondent's signatures on the Agreement to Sell. He categorically stated that Respondent had signed the agreement in his presence. In his reply in Cross Examination, he deposed to be a witness to the Agreement to Sell and that Agreement to Sell had been executed in his presence. Relevant extract is reproduced herein below: "Q.15. Whether you had occasion to see Ms. Seema Gupta write and sign her signatures before 26.10.2015? Ans: No, I had seen her sign only on 26.10.2015 when she signed CW 1/A. iii. Respondent/RW-2 denied execution of the Agreement to Sell. In her cross-examination she stated that signatures on the Agreement to Sell were 'very similar' to her signatures but they were not her signatures. Respondent's husband RW- 1 also denied the execution of the Agreement to Sell by Respondent. In his cross examination, he deposed that Agreement to Sell was not got examined by Truth Lab as Respondent's signatures on the alleged Agreement to Sell, looked similar to her usual style of signatures. Relevant extract is-produced below for ready reference: Q.[6] Is it correct that you did not get the agreement to Sell dated 26.10.2015, examined from the Truth Lab. Ans: Yes. Q.7. I put it to you and your wife were fully in the knowledge that the agreement to Sell dated 26.10.2015 was signed by your wife and therefore you did not get this agreement examined from any expert. What do you say? Ans: It is incorrect to so suggest. We did not get it examined from the handwriting expert because the signatures on the alleged agreement looked similar to her usual style. of signatures. iv. During arguments, Counsel for Respondent submitted that signatures on Agreement to Sell appears to be of Respondent, but she does not remember to have signed the agreement. On perusal of whole cross examination of Respondent, it is strongly suggestive that it was her husband who took care of all her financial dealings and she only affixed her signatures, whenever she was told to do so by her husband. v. This would further show that when a question was put to her by the Tribunal regarding Balance sheet of M/s Blue Planet Farms Pvt. Ltd. filed with Ministry of Corporate affairs, and Director's Report of Jaguar Farms Private Limited, where Respondent had been a Director Claimant showed certified copies of the same to Respondent which she denied having signed. "Do we take it that you are oblivious of the affairs of the various businesses and companies since the same are looked after by your husband and as per you on his asking you affix your signatures without knowing or understanding the contents of the documents xi to x17?" She answered in affirmative 'Yes'. Tribunal further enquired if her answer in respect of Balance sheet of M/s Blue Planet Farms Pvt. Ltd. and Director's Report of Jaguar Farms Private Limited., (x1-x17) was true as well as for other documents, to which she replied in affirmative. vi. Testimonies of CW-1 and CW-2 remained unshaken throughout cross examination. Testimony of Respondent show her obliviousness of nature of business and contents of documents where she affixes her signatures to. In such circumstances, it would be appropriate to infer that she often affixes her signatures in a mechanical manner on her husband's instructions.‖

61. The learned Arbitrator noted that the petitioner herein failed to corroborate her plea that the document pertaining to the Agreement to Sell was not signed by her. It was noted that the petitioner was often oblivious of the contents of the documents she used to sign since her husband used to take care of the finances. It was also noted by the learned Arbitrator that the petitioner herein suggested that the signatures on the document in question were very similar to hers, however, she did not take any steps to have the same examined.

62. Thereafter, to the issue of plea of alibi, the learned Arbitrator held as under:- ―Respondent raised the plea of alibi for the first time in her cross-examination. In her cross- examination, she deposed that they were not in Delhi and had gone to Panchkula to invite former Deputy Chief Minister Mr. Chandramohan and his wife for her son's wedding. As already noted application to examine Dr. Naresh Kaushal was allowed by the Tribunal in view of "no objection" by Respondent's Counsel. In addition to reasons already stated, it was admitted by RW-3 that he met Respondent and her husband Mr. Amrish Gupta only once; but curiously, was able to identify RW-1. It is pertinent to note that Mr. Amrish Gupta, RW-1, the patient himself did not mention the visit to Panchkula or falling ill at Kamal in his affidavit by way of evidence or during his cross examination. It was only during the crossexamination of Respondent/RW-2, at a later date, when she for first time volunteered to say that they were not in Delhi on 26/10/2015 i.e. the date of execution of the Agreement to Sell. Evidence of Dr. Naresh Kaushal does not instil confidence of this Tribunal for several reasons. RW-3 deposed to have checked blood pressure, ECG and carried out other random blood tests including sugar. No entries were made either in the hospital register or laboratory, where tests had been conducted. He admitted that as a matter of course, entries were made in patient's record, laboratory and hospital register when blood tests, ECG and intravenous glucose is administered to a patient, but no such entry had and administration of intravenous glucose takes away the credibility of bald statement of the witness. Moreover, no ECG report or test results have been produced by Respondent or the laboratory of that date to substantiate examination/tests but only photocopy of prescription was shown. Curiously, Dr. Naresh Kaushal recognized Mr. Amrish Gupta whom he claims to have met only once on 26.10.2015 but could not give the name of even one patient out of 12 patients, he claimed to have examined the day before his deposition on 20.02.2019. He appears to be a procured and biased witness, who does not deserve any credence or inspire any confidence. The absence of any entry in the Hospital record of the tests carried out or ECG done, or any payment therefor cuts at the root of his deposition been made in present case. No convincing reason had been given by the witness during the cross-examination for this. Absence of entries of blood tests, ECG and administration of intravenous glucose takes away the credibility of bald statement of the witness. Moreover, no ECG report or test results have been produced by Respondent or the laboratory of that date to substantiate examination/tests but only photocopy of prescription was shown. Curiously, Dr. Naresh Kaushal recognized Mr. Amrish Gupta whom he claims to have met only once on 26.10.2015 but could not give the name of even one patient out of 12 patients, he claimed to have examined the day before ·his deposition on 20.02.2019. He appears to be a procured and biased witness, who does not deserve any credence or inspire any confidence. The absence of any entry in the Hospital record of the tests carried out or ECG done, or any payment therefor cuts at the root of his deposition. Moreover, plea of alibi was not taken at the earliest stage. Respondent, neither in Statement of Defence nor in her evidence by affidavit, had taken this plea. It arouses suspicion when taken at belated stage, in a last ditch attempt to support the plea of nonexecution of the agreement in the face of credible evidence led by the Claimant. Respondent throughout the proceedings had simply denied execution of Agreement to Sell without raising plea of alibi or examining any of the witnesses to prove her alleged trip to Panchkula. It shows nothing but an afterthought defence. Judicial Pronouncements relied on by the Claimant namely Mohinder Singh v State, reported at AIR 1953 Cri LJ 1761; Lakban Singh @ Pappu vs The State of NCT of Delhi, reported at Cr. Appeal No. 166/1999, are with regard to consequences flowing from the plea of alibi in criminal matters being found to be false. Even though analogy of adverse inference to reject the other defences as well can be drawn, but in view of foregoing discussion and reasons, the plea of alibi as taken by Respondent deserves to be rejected on merits as well. In light of foregoing discussion, I hold that the Agreement to Sell dated 26.10.2015 was duly executed between Claimant and the Respondent with sum of Rs.40,00,00/-, being paid as part sale consideration and the denial thereof by Respondent is wrongful, with ulterior motive to somehow avoid, deny and resile from the bargain entered into.‖

63. It was observed by the learned Arbitrator that the application for plea of alibi was raised by the petitioner herein at a belated stage. It was further noted that nothing on record, including material or even the testimony of RW-3, could substantiate the claim raised by the petitioner to suggest that she was not present at the place of signing of the Agreement on the day it was signed.

64. While considering the objection the question of allegations regarding cross-loan transaction, the learned Arbitrator held as under:- ―vii. Let us now consider the defence raised by the Respondent namely the receipt of Rs. Rs.40,00,000/- was towards a loan. Not a single document has been produced by way of any receipt or any loan agreement. The said amount has also not been reflected in the Income Tax returns of the Respondent. No remittance of any interest or deduction of any tax on the interest income has been either produced, or proved on record. Respondent also was unaware about the rate or interest or if it was an interest free loan. Relevant portion from her cross-examination is reproduced herein below: Q.28. What kind of financial transaction between your husband and Mr. Sunny Talwani? Tribunal has allowed the witness to refer to para 3 of Exhibit R W2/ A to give complete answer to the question. Ans: I am not aware. Again, said 1 am not aware of the nature of transactions or the numbers thereof and the amounts thereof.

Claimant and your wife Mrs. Seema Gupta is pertaining to the agreement, which is the subject matter of the arbitration and execution of which is denied by the Respondent? Ans. Yes, it is correct. There is no other direct transaction between the Claimant and my wife Seema Gupta. Q.11 Shown para 3 of your affidavit Ex. RW1/A. I put it to you that there was no transaction between Respondent and her family with the Claimant's family and your statement to the fact that the transaction has been done from the personal accounts of Respondent and his family with the Claimant's family members is incorrect. What do you have to say? Ans. It is correct. Answer to Question no. 11 by Respondent's husband is a clear admission of the falsity of the plea taken regarding cross-loans with Claimant and his family. Further suggestions in respect of Claimant's association with numerous companies to prove cross loans also proved to be a wild goose chase. Respondent in her written submission and her affidavit pleaded that Claimant had taken cross-loans from Respondent's husband of more than four to five crores for his related firms like M/S Sarna Sale, M/S ASP Sealing Products Pvt. Ltd., MIS Supreme Electricals and M/S Bharat Communication. There is no special relation of Respondent's husband with Claimant pleaded or shown or even Claimant's connection with the said parties so as to secure loan for them from Respondent and/or her husband. Respondent further referred to ongoing recovery proceedings against these firms which are related to Claimant. Respondent's husband was cross-examined on these aspects of cross-loans and business transactions. Extract from cross-examination of Respondent's husband are given below for ready reference: Q.13. What was/is the constitution of M/s Sarna Sale, M/s ASP Sealing Products Pvt. Ltd., M/s Supreme Electricals and M/s Bharat Communications, to whom you have allegedly advance loans ofRs.[4] to 5 crores? Ans: I do not know the constitution of the above entities except that of M/s Bharat Communications. M/s Bharat Communication is a sole proprietorship concern owned by Mr. Bharat Goel. All these loans were given at the behest of the Claimant without knowing the other concerns. x. The answers to questions as above do not indicate any connection of Claimant with these transactions. Moreover, Claimant is not impleaded as party in any of these recovery proceedings, filed by Respondent's and/or her husband. Respondent's claim of cross-loans falls flat. It is Clear therefore that no financial transaction had been made by Respondent or her family with Claimant. Moreover, her plea of associating Claimant is without any factual foundation. Therefore, the plea of Respondent, that the said sum being a loan transaction or part of a cross-loans with Claimant/family members is found to be baseless and without any factual foundation and has only be to state to be rejected, insofar as the Claimant and the present transaction are concerned.‖

65. Upon consideration of the examination and cross-examination of the relevant witnesses, the learned Arbitrator made the above findings.

66. A perusal of the aforementioned portions of the Award clearly show that the claims raised on behalf of the petitioner herein have been considered, adjudicated upon and answered by the learned Arbitrator in the impugned Award. It is evident that not only has he given sufficient reasons for the findings but such findings have also been supported with evidence and other material on record. The petitioner failed to corroborate, with her submissions and even evidence that the Agreement to Sell was forged and fabricated. At this stage, the scope of interference, which has been laid out in the foregoing paragraphs, is referred to. There is no need for this Court to enter into the validity of the reasoning and the findings given by the learned Arbitrator.

67. During the course of the argument before this Court, it was argued on behalf of the petitioner that the learned Arbitrator did not give any finding on the aspect of execution of the Agreement, however, the contrary is evident from the perusal of the Award that the aspect was duly and carefully considered by the learned Arbitrator at length and only after consideration and appreciation of material, the findings against the petitioner were passed.

68. After considering the question of whether an Agreement to Sell was executed between the parties concerned, the learned Arbitrator proceeded to adjudicate the question whether the respondent was entitled for specific relief of the Agreement to Sell.

69. The law regarding the issue specific performance under the Specific Relief Act, has been settled. The same stands modified with the amendments brought about in the Specific Relief Act introduced in 2018. The relief of specific performance is an equitable relief. As per the amended Act, the Courts no longer have discretionary powers under the Specific Relief Act while adjudicating a relief of specific performance. The Court may require to be satisfied on certain tests before granting the relief of specific performance, however, upon fulfilment of the ingredients and satisfaction of the court, a relief of specific performance may mandatorily be granted. To this effect, the Hon’ble Supreme Court in Katta Sujatha Reddy v. Siddamsetty Infra Projects (P) Ltd., (2023) 1 SCC 355 while holding that the amendments brought to the Specific Relief Act in the year 2018 are prospective and not retrospective in nature, observed as under:- ―44. We may note that the Specific Relief Act, 1963 is the second legislation, replacing the earlier 1877 enactment of the Specific Relief Act. The 1963 Act was enacted after consideration of the Law Commission in its Ninth Report. The 1963 Act more or less followed the English position on equitable remedy of specific performance. In Common Law, the remedy of specific performance was unknown in the initial days and courts only granted damages for the value of goods if there was any breach of contract. Accordingly English courts, in the early years, granted monetary relief. In order to rectify the harsh stance of law, Courts of Equity in England started granting relief of specific performance if the Court of Equity found that granting damages would be inadequate or some special equitable rights of the plaintiff under a trust have been breached.

45. In any case, grant of such relief, which emanated from equitable principles, remained discretionary. This principle is clearly explained by Swinfen Eady M.R., in Whiteley Ltd. v. Hilt [Whiteley Ltd. v. Hilt, (1918) 2 KB 808 (CA)], in the following manner: (KB p. 819) ―… the power vested in the Court to order the delivery up of a particular chattel is discretionary, and ought not to be exercised when the chattel is an ordinary article of commerce and of no special value or interest, and not alleged to be of any special value to the plaintiff, and where the damages would fully compensate.‖

46. However, this was not the position under the Civil Law. Under the Civil Law of contracts, adherence to the sanctity of contract is enforced with greater rigour by inversing the situation. The reason for choice of damages and specific performance range from legal to economic. It is in this context that the courts cannot engage on the merits of having damages or specific performance or a hybrid. It is best left to the legislature to choose the course best-suited to the economy without sheepishly following the typecast approach in England or Civil Law systems.

48. We do not subscribe to the aforesaid reasoning provided by the High Court for the simple reason that after the 2018 Amendment, specific performance, which stood as a discretionary remedy, is not (sic now) codified as an enforceable right which is not dependent anymore on equitable principles expounded by Judges, rather it is founded on satisfaction of the requisite ingredients as provided under the Specific Relief Act. For determination of whether a substituted law is procedural or substantive, reference to the nature of the parent enactment may not be material. Instead, it is the nature of the amendments which determine whether they are in the realm of procedural or substantive law.

51. In any case, the amendment carried out in 2018 was enacted to further bolster adherence to the sanctity of contracts. This approach was radical and created new rights and obligations which did not exist prior to such an amendment. Section 10, after amendment, reads as under: ―10. Specific performance in respect of contracts.— The specific performance of a contract shall be enforced by the court subject to the provisions contained in sub-section (2) of Section 11, Section 14 and Section 16.‖

52. This provision, which remained in the realm of the courts' discretion, was converted into a mandatory provision, prescribing a power the courts had to exercise when the ingredients were fulfilled. This was a significant step in the growth of commercial law as the sanctity of contracts was reinforced with parties having to comply with contracts and thereby reducing efficient breaches.

53. Under the pre-amended Specific Relief Act, one of the major considerations for grant of specific performance was the adequacy of damages under Section 14(1)(a). However, this consideration has now been completely done away with, in order to provide better compensation to the aggrieved party in the form of specific performance.

54. Having come to the conclusion that the 2018 Amendment was not a mere procedural enactment, rather it had substantive principles built into its working, this Court cannot hold that such amendments would apply retrospectively.‖

70. The Hon’ble Supreme Court, prior to holding that the relief of specific performance is no longer discretionary, in the judgment of Kamal Kumar v. Premlata Joshi, (2019) 3 SCC 704 stipulated certain considerations while adjudicating a plea so raised by a party and held as under:- ―7. …. The material questions, which are required to be gone into for grant of the relief of specific performance, are:

7.1. First, whether there exists a valid and concluded contract between the parties for sale/purchase of the suit property.

7.2. Second, whether the plaintiff has been ready and willing to perform his part of contract and whether he is still ready and willing to perform his part as mentioned in the contract.

7.3. Third, whether the plaintiff has, in fact, performed his part of the contract and, if so, how and to what extent and in what manner he has performed and whether such performance was in conformity with the terms of the contract;

7.4. Fourth, whether it will be equitable to grant the relief of specific performance to the plaintiff against the defendant in relation to suit property or it will cause any kind of hardship to the defendant and, if so, how and in what manner and the extent if such relief is eventually granted to the plaintiff;

7.5. Lastly, whether the plaintiff is entitled for grant of any other alternative relief, namely, refund of earnest money, etc. and, if so, on what grounds.

8. In our opinion, the aforementioned questions are part of the statutory requirements [See Sections 16(c), 20, 21, 22, 23 of the Specific Relief Act, 1963 and Forms 47/48 of Appendices A to C of the Code of Civil Procedure]. These requirements have to be properly pleaded by the parties in their respective pleadings and proved with the aid of evidence in accordance with law. It is only then the Court is entitled to exercise its discretion and accordingly grant or refuse the relief of specific performance depending upon the case made out by the parties on facts.‖

71. In the instant case, the learned Arbitrator, while allowing the Claim of the respondent, held as under:- ―For purposes of grant of relief of specific performance, Tribunal is to look into Claimant's averments and conduct to adjudge whether he performed or has always been ready and willing to perform, essential terms of contract, other than those which are prevented or waived by Respondent. While examining the entitlement, the conduct of parties is also to be seen qua the obligations undertaken. Specific Performance being a statutory remedy, Tribunal has to examine readiness and willingness of Claimant, conduct of the parties by evaluating the evidence led by the parties and whether the same meets the statutory requirements and exercise discretion accordingly. This needs to be done in the context of the obligations, reciprocal promises undertaken in terms of the Agreement to Sell. *** In view of the discussion in preceding paras, the due execution of Agreement to Sell stands established. We now need to examine whether the Claimant has also shown its readiness and willingness to go through the transaction and/or whether he was precluded from doing so by the actions and conduct of the Respondent. Claimant in his affidavit by way of evidence, deposed that he had offered the balance sale consideration of Rs.20,00,000/- number of times but Respondent was not coming forward for execution of the Sale Deed. Claimant reiterated his readiness and willingness to pay remaining sale consideration of Rs.20,00,000/- subject to the latter executing the sale Deed in favour of Claimant in his cross-examination. As per requirement u/s 16 of the Specific Relief Act, 1963 that Claimant must plead/aver to have performed or being ready and willing to perform, the essential obligation under the contract, Claimant has discharged that burden to aver. xviii. It may also be noticed that apart from the conduct of the Claimant, in case, it is found that the Respondent/defendant who either does not come with clean hands or suppresses or delays or misleads the Court, then discretion is not to be exercised in Respondent/ defendant's favour by refusing Specific Performance to the Claimant. Reference is invited to judgment of Supreme Court in Zarina Siddiqui vs A. Ramalingam@ R. Amarnathan reported at 2015 (1) SCC 705 while dealing on issue of specific performance observed:

33. "The equitable discretion to grant or not to grant a relief for specific performance also depends upon the conduct of the parties. The necessary ingredient has to be proved and established by the plaintiff so that discretion would be exercised judiciously in favour of the plaintiff At the same time. if the defendant does not come with clean hands and suppresses material facts and evidence and misled the Court then such discretion should not be exercised by refusing to grant specific performance.

34. In the instant case, as noticed above, although Defendant 2 held a registered power of attorney on behalf of Defendant 1 to Sell and dispose of the property, but the defendants not only made a false statement on affidavit that the power of.attorney had authorized the second defendant only to look after.and manage the property but also. withheld the said power of attorney from the court in order to misguide the court from the truth of the facts. Further, by registered agreement the defendants agreed to Sell the suit premises after receiving advance consideration but they denied the existence of the agreement in their pleadings. Such conduct of the defendants in our opinion. disentitles them to ask the court for exercising discretion in their favour by refusing to grant a decree for specific performance. Further, If a party to a lis does not disclose all material facts truly and fairly but states them in distorted manner and misleads the court, the court has inherent power to exercise its discretionary jurisdiction in order to prevent abuse of process of law ". Applying the ratio of the above case, it would be seen that in the instant case, Respondent has falsely chosen to deny the factum of execution of Agreement to Sell itself and rather taken a defence of the payment of substantial consideration of Rs.40,00,000/- being a loan with other cross-loans, which defence has been found to be moonshine and wholly unsustainable. It would follow from the above that the Respondent who was denying transaction of Agreement to Sell, had no intention to perform her part of obligation. Neither did Respondent handover possession nor did Respondent take any other steps, towards initiating the process of obtaining the permission u/s 4 of The Delhi Land (Restrictions on Transfer) Act, 1972. Therefore, in terms of the aforesaid judgments the Respondent, who is guilty of abuse of legal process and taking false pleas cannot seek the discretion of the Tribunal in her favour by refusing to grant a decree of Specific performance. Reference may also be made in this regard to the case of Silvey and Ors. vs. Arun Varghese and Ors. reported at (2008) 11 SCC 45, to support the proposition that discretion should not be exercised in favour of the defendant by refusing grant of specific performance to plaintiff, where defendant took a false plea and was not ready to perform his part of the obligation. xxi. Claimant's conduct prior and subsequent to filing of claim are taken into consideration. Readiness of Claimant can be seen from his financial capacity whereas willingness would be derived from his conduct. Therefore, to prove readiness Claimant must prove his financial capacity to pay the balance amount ofRs.20,00,000/- since the day of execution of Agreement to Sell till the date of award and the same is examined in light of evidence led by Claimant. To determine readiness, Claimant's income for the assessment year of 2016-17 is Rs.12,32,767/- as per his Bank Statement/Balance Sheet. Income Tax Returns for "assessment year of 2018-19 is Rs. 20,86,217/-. Additionally, Claimant produced Bank Statement of Claimant's proprietorship M/S GRV Polymers w.e.f 01.01.2016 to 31.03.2017 with sanctioned loan facility of Rs. Rs.94,00,000/- (Ninety Four Lakhs) and additional Rs.20,00,000/- extended to Claimant's proprietorship by Bank of Baroda against collateral Securities. In view of the above evidence, it would be seen that loan facility extended to Claimant against securities of Claimant was at his disposal with liberty to put money to his use. As on 25:04.2016, it had drawing option/window of Rs.93,79,548/-. Subsequently profit ofRs.16,25,085/- is reflected for the year ending on 31.03.2018. Moreover, Claimant's own income for the year ?O 16-1 7 was shown to be of about 12 lakhs and for the year 2018-19, it was Rs.20 lakhs. Moreover, Claimant also discharged the burden of paying the entire arbitral fee with Respondent unwilling to pay due to alleged financial duress and hardship. Claimant had enough liquidity to pay the balance sale consideration of only Rs.20,00,000/- while substantial consideration of Rs.40,00,000/- stood already paid. Therefore, Claimant has proved his readiness and capacity to pay the remaining sum ofRs.20,00,000/ throughout. In view of the aforesaid authoritative pronouncement of the Supreme court directly applicable to the case, I have not considered it necessary to advert to other judgments cited by the Claimant and Respondent. It is therefore held that the Claimant is not disentitled to the relief of decree of Specific Performance merely on the ground of absence of communication for the period of 11 months during which time he was following up and making efforts with the Respondent for completing the sale and not resort to litigation. Further, I am of the view that, Claimant having proved his readiness and willingness with financial capacity to pay the remaining balance sale consideration of Rs.20,00,000/-, is entitled to the decree of Specific Performance of the Agreement to Sell dated 26.10.2015. An award is accordingly passed in favour of the Claimant and against the Respondent granting specific performance of the Agreement to Sell dated 26.10.2015 in respect of Agriculture land admeasuring 2 bighas 8 biswas, bearing Mustatil No. 3, Killa Nos. 2111 (1-

4) and 2112 Min 1112 (1-4), situated in village Jonapur, Tehsil, Mehrauli, New Delhi. subject to the Claimant depositing the balance sale consideration of Rs. 20,00,000/before the Registrar General of High Court of Delhi within 2 weeks of the Respondent applying for and obtaining NOC/ Permission for transfer of the suit land under the (Delhi Land Restriction on Transfer) Act. Claimant shall join the Respondent in any such application for obtaining NOC. In case, the Respondent fails to apply for such permission, the Claimant may apply to the Registrar of the High Court for obtaining such permission.‖

72. It is apparent that the learned Arbitrator considered the aspect of readiness and willingness to perform an Agreement while deciding the question of specific performance while applying the principles to the facts of the instant case. Referring to the judgments of the Hon’ble Supreme Court as well as the issue of extended time period raised by the petitioner herein, the learned Arbitrator found that there was a degree of readiness and willingness on the part of the respondent to fulfil his obligations and perform the Agreement. The learned Arbitrator has thoroughly considered the evidence, contentions of the parties as well as the law laid down by the judicial precedents before reaching the conclusion that the respondent is entitled for specific performance of the Agreement.

73. Therefore, this Court on the Issue No. II is of the opinion that the learned Arbitrator thoroughly and elaborately considered the objections raised on behalf of the petitioner regarding execution of the Agreement to Sell and only thereafter considered the question of specific performance of the Agreement after due appreciation of evidence and material on record.

ISSUE NO. III

74. Since, it has been settled that the scope of interference under Section 34 of the Arbitration Act is limited, it is now pertinent to see the considerations that are to be considered while adjudicating upon a challenge and in what circumstances may an Award may be set aside.

75. On a bare reading of the invoked provision Section 34 of the Arbitration Act as quoted above, it has become evident the words used therein are that “An arbitral award may be set aside by the Court only if”, which signifies the intent of limiting the scope of interference by Courts in an Arbitral Award, passed after thorough procedure, involvement of parties, and appreciation of facts, evidence and law, “only” in the event of the circumstances delineated in the provision being met. The limited grounds which may invite the intervention and action thereupon by the Courts are explicitly laid down under the provision. What is to be seen by a Court exercising jurisdiction under Section 34 of the Arbitration Act is that an Award passed by an Arbitral Tribunal may only be set aside if it is patently illegal, against the public policy of India, based on no evidence and delineates no reason for passing the Award.

76. The petitioner has raised the ground of patent illegality as well as contravention to public policy while impugning the Award dated 30th September 2019.

77. The Hon’ble Supreme Court in BCCI vs. Cricket Association & Ors. (2015) 3 SCC 251, on the question of public policy, held as under:- ―90. The validity of Rule 6.2.[4] as amended can be examined also from the standpoint of its being opposed to "public policy". But for doing so we need to first examine what is meant by "public policy" as it is understood in legal parlance. The expression has been used in Section 23 of the Contract Act, 1872 and in Section 34 of the Arbitration and Conciliation Act, 1996 and host of other statutes but has not been given any precise definition primarily because the expression represents a dynamic concept and is, therefore, incapable of any straitjacket definition, meaning or explanation. That has not, however, deterred jurists and courts from explaining the expression from very early times.

91. Mathew, J. speaking for the Court in Murlidhar Aggarwal v. State of U.P. 27 referred to Winfield's definition in Public Policy in English Common Law 42 Harvard Law Review 76 to declare that: (SCC p. 482, para 31) ―31. Public policy does not remain static in any given community. It may vary from generation to generation and even in the same generation. Public policy would be almost useless if it were to remain in fixed moulds for all time.‖

92. The Court then grappled with the problem of ascertaining public policy if the same is variable and depends on the welfare of the community and observed: (Murlidhar Aggarwal case27, SCC pp. 482-83, para 32) ―3 2. If it is variable, if it depends on the welfare of the community at any given time, how are the courts to ascertain it? The Judges are more to be trusted as interpreters of the law than as expounders of public policy. However, there is no alternative under our system but to vest this power with Judges. The difficulty of discovering what public policy is at any given moment certainly does not absolve the Judges from the duty of doing so. In conducting an enquiry, as already stated, Judges are not hidebound by precedent. The Judges must look beyond the narrow field of past precedents, though this still leaves open the question, in which direction they must cast their gaze. The Judges are to base their decisions on the opinions of men of the world, as distinguished from opinions based on legal learning. In other words, the Judges will have to look beyond the jurisprudence and that in so doing, they must consult not their own personal standards or predilections but those of the dominant opinion at a given moment, or what has been termed customary morality. The Judges must consider the social consequences of the rule propounded, especially in the light of the factual evidence available as to its probable results. Of course, it is not to be expected that men of the world are to be subpoenaed as expert witnesses in the trial of every action raising a question of public policy. It is not open to the Judges to make a sort of referendum or hear evidence or conduct an inquiry as to the prevailing moral concept. Such an extended extra-judicial enquiry is wholly outside the tradition of courts where the tendency is to 'trust the Judge to be a typical representative of his day and generation'. Our law relies, on the implied insight of the Judge on such matters. It is the Judges themselves, assisted by the Bar, who here represent the highest common factor of public sentiment and intelligence. No doubt, there is no assurance that Judges will interpret the mores* of their day more wisely and truly than other men. But this is beside the point. The point is rather that this power must be lodged somewhere and under our Constitution and laws, it has been lodged in the Judges and if they have to fulfil their function as Judges, it could hardly be lodged elsewhere.‖

93. In Central Inland Water Transport Corpn. this Court was also considering the import of the expression "public policy" in the context of the service conditions of an employee empowering the employer to terminate his service at his sweet will upon service of three months' notice or payment of salary in lieu thereof. Explaining the dynamic nature of the concept of public policy this Court observed: (SCC pp. 217- 18, para 92) ―92.... Public policy, however, is not the policy of a particular Government. It connotes some matter which concerns the public good and the public interest. The concept of what is for the public good or in the public interest or what would be injurious or harmful to the public good or the public interest has varied from time to time. As new concepts take the place of old, transactions which were once considered against public policy are now being upheld by the courts and similarly where there has been a well recognised head of public policy, the courts have not shirked from extending it to new transactions and changed circumstances and have at times not even flinched from inventing a new head of public policy.... It is thus clear that the principles governing public policy must be and are capable, on proper occasion, of expansion or modification. Practices which were considered perfectly normal at one time have today become obnoxious and oppressive to public conscience. If there is no head of public policy which covers a case, then the court must in consonance with public conscience and in keeping with public good and public interest declare such practice to be opposed to public policy. Above all, in deciding any case which may not be covered by authority our courts have before them the beacon light of the Preamble to the Constitution. Lacking precedent, the court can always be guided by that light and the principles underlying the fundamental rights and the directive principles enshrined in our Constitution.‖

94. We may also refer to the decision of this Court in ONGC Ltd. v. Saw Pipes Ltd., wherein this Court was considering the meaning and import of the expression "public policy of India" as a ground for setting aside an arbitral award. Speaking for the Court M.B. Shah, J. held that the expression "public policy of India" appearing in the Act aforementioned must be given a liberal meaning for otherwise resolution of disputes by resort to arbitration proceedings will get frustrated because patently illegal awards would remain immune to court's interference. This Court declared that what was against public good and public interest cannot be held to be consistent with public policy. The following passage aptly summed up the approach to be adopted in the matter: (Saw Pipes Ltd. case, SCC pp. 727-28, para 31) ―31. Therefore, in our view, the phrase 'public policy of India' used in Section 34 in context is required to be given a wider meaning. It can be stated that the concept of public policy connotes some matter which concerns public good and the public interest. What is for public good or in public interest or what would be injurious or harmful to the public good or public interest has varied from time to time. However, the award which is, on the face of it, patently in violation of statutory provisions cannot be said to be in public interest. Such award/judgment/decision is likely to adversely affect the administration of justice. Hence, in our view in addition to narrower meaning given to the term 'public policy' in Renusagar case it is required to be held that the award could be set aside if it is patently illegal. The result would be-award could be set aside if it is contrary to: (a) fundamental policy of Indian law; or (b) the interest of India; or

(c) justice or morality, or

(d) in addition, if it is patently illegal.

Illegality must go to the root of the matter and if the illegality is of trivial nature it cannot be held that award is against the public policy. Award could also be set aside if it is so unfair and unreasonable that it shocks the conscience of the court. Such award is opposed to public policy and is required to be adjudged void.‖

95. In ONGC Ltd. v. Western GECO International Ltd., this Court was examining the meaning of "fundamental policy of Indian law", an expression used by this Court in Saw Pipes case. Extending the frontiers of what will constitute "public policy of India" this Court observed: (Western GECO International Ltd. case, SCC pp. 278-80, paras 35 & 38-39) ―35. What then would constitute the 'fundamental policy of Indian law' is the question. The decision in ONGC does not elaborate that aspect. Even so, the expression must, in our opinion, include all such fundamental principles as providing a basis for administration of justice a and enforcement of law in this country. Without meaning to exhaustively enumerate the purport of the expression 'fundamental policy of Indian law', we may refer to three distinct and fundamental juristic principles that must necessarily be understood as a part and parcel of the fundamental policy of Indian law. The first and foremost is the principle that in every determination whether by a court or other authority that affects the rights of a citizen or leads to any civil consequences, the court or authority concerned is bound to adopt what is in legal parlance called a 'judicial approach' in the matter. The duty to adopt a judicial approach arises from the very nature of the power exercised by the court or the authority does not have to be separately or additionally enjoined upon the fora concerned. What must be remembered is that the importance of a judicial approach in judicial and quasi-judicial determination lies in the fact that so long as the court, tribunal or the authority exercising powers that affect the rights or obligations of the parties before them shows fidelity to judicial approach, they cannot act in an arbitrary, capricious or whimsical manner. Judicial approach ensures that the authority acts bona fide and deals with the subject in a fair, reasonable and objective manner and that its decision is not actuated by any extraneous consideration. Judicial approach in that sense acts as a check against flaws and faults that can render the decision of a court, tribunal or authority vulnerable to challenge.

38. Equally important and indeed fundamental to the policy of Indian law is the principle that a court and so also a quasi-judicial authority must, while determining the rights and obligations of parties before it, do so in accordance with the principles of natural justice. Besides the celebrated audi alteram partem rule one of the facets of the principles of natural justice is that the court/authority deciding the matter must apply its mind to the attendant facts and circumstances while taking a view one way or the other. Non-application of mind is a defect that is fatal to any adjudication. Application of mind is best demonstrated by disclosure of the mind and disclosure of mind is best done by recording reasons in support of the decision which the court or authority is taking. The requirement that an adjudicatory authority must apply its mind is, in that view, so deeply embedded in our jurisprudence that it can be described as a fundamental policy of Indian law.

39. No less important is the principle now recognised as a salutary juristic fundamental in administrative law that a decision which is perverse or so irrational that no reasonable person would have arrived at the same will not be sustained in a court of law. Perversity or irrationality of decisions is tested on the touchstone of Wednesbury Principle of reasonableness. Decisions that fall short of the standards of reasonableness are open to challenge in a court of law often in writ jurisdiction of the superior courts but no less in statutory processes wherever the same are available.‖

96. To sum up: public policy is not a static concept. It varies with times and from generation to generation. But what is in public good and public interest cannot be opposed to public policy and vice versa. Fundamental Policy of Law would also constitute a facet of public policy. This would imply that all those principles of law that ensure justice, fair play and bring transparency and objectivity and promote probity in the discharge of public functions would also constitute public policy. Conversely, any deviation, abrogation, frustration or negation of the salutary principles of justice, fairness, good conscience, equity and objectivity will be opposed to public policy. It follows that any rule, contract or arrangement that actually defeats or tends to defeat the high ideals of fairness and objectivity in the discharge of public functions no matter by a private non-governmental body will be opposed to public policy. ….‖

78. While discussing the fundamentals of patent illegality, the Hon’ble Supreme Court in State of Chhattisgarh vs. Sal Udyog (P) Ltd., (2022) 2 SCC 275 held as under:- ―14. The law on interference in matters of awards under the 1996 Act has been circumscribed with the object of minimising interference by courts in arbitration matters. One of the grounds on which an award may be set aside is "patent illegality". What would constitute "patent illegality" has been elaborated in Associate Builders v. DDA, where "patent illegality" that broadly falls under the head of "Public Policy", has been divided into three sub-heads in the following words: (SCC p. 81, para 42) ―42. In the 1996 Act, this principle is substituted by the "patent illegality" principle which, in turn, contains three sub-heads:

42.1. (a) A contravention of the substantive law of India would result in the death knell of an arbitral award. This must be understood in the sense that such illegality must go to the root of the matter and cannot be of a trivial nature. This again is really a contravention of Section 28(1 )(a) of the Act, which reads as under: '28. Rules applicable to substance of dispute.-(]) Where the place of arbitration is situated in lndia,- (a) in an arbitration other than an international commercial arbitration, the Arbitral Tribunal shall decide the dispute submitted to arbitration in accordance with the substantive law for the time being in force in India;'

42.2. (b) A contravention of the Arbitration Act itself would be regarded as a patent illegality - for example if an arbitrator gives no reasons for an award in contravention of Section 31 (3) of the Act, such award will be liable to be set aside.

42.3. (c) Equally, the third sub-head of patent illegality is really a contravention of Section 28( 3) of the Arbitration Act, which reads as under: '28. Rules applicable to substance of dispute.- (1)-(2) * * * (3) In all cases, the Arbitral Tribunal shall decide in accordance with the terms of the contract and shall take into account the usages of the trade applicable to the transaction.'

15. In Ssangyong Engg. & Construction Co. Ltd. v. NHAJ[9], speaking for the Bench, R.F. Nariman, J. has spelt out the contours of the limited scope of judicial interference in reviewing the arbitral awards under the 1996 Act and observed thus: (SCC pp. 169-71, paras 34-41) "34. What is clear, therefore, is that the expression "public policy of India", whether contained in Section 34 or in Section 48, would now mean the "fundamental policy of Indian law" as explained in paras 18 and 27 of Associate Builders[8] i.e. the fundamental policy of Indian law would be relegated to "Renusagar" understanding of this expression. This would necessarily mean that Western Geco 10 expansion has been done away with. In short, Western Geco10, as explained in paras 28 and 29 of Associate Builders[8], would no longer obtain, as under the guise of interfering with an award on the ground that the arbitrator has not adopted a judicial approach, the Court's intervention would be on the merits of the award, which cannot be permitted post amendment. However, insofar as principles of natural justice are concerned, as contained in Sections 18 and 34(2)(a)(iii) of the 1996 Act, these continue to be grounds of challenge of an award, as is contained in para 30 of Associate Builders[8]. 3 5. It is important to notice that the ground for interference insofar as it concerns "interest of India" has since been deleted, and therefore, no longer obtains. Equally, the ground for interference on the basis that the award is in conflict with justice or morality is now to be understood as a conflict with the "most basic notions of morality or justice". This again would be in line with paras 36 to 39 of Associate Builders[8], as it is only such arbitral awards that shock the conscience of the court that can be set aside on this ground.

36. Thus, it is clear that public policy of India is now constricted to mean firstly, that a domestic award is contrary to the fundamental policy f Indian law, as understood in paras 18 and 27 of Associate Builders[8], or secondly, that such award is against basic notions of justice or morality as understood in paras 36 to 39 of Associate Builders[8]. Explanation 2 to Section 34(2)(b )(ii) and Explanation 2 to Section 48(2)(b )(ii) was added by the Amendment Act only so that Western Geco10, as understood in Associate Builders[8], and paras 28 and 29 in particular, is now done away with.

37. Insofar as domestic awards made in India are concerned, an additional ground is now available under sub-section (2-A), added by the Amendment Act, 2015, to Section 34. Here, there must be patent illegality appearing on the face of the award, which refers to such illegality as goes to the root of the matter but which does not amount to mere erroneous application of the law. In short, what is not subsumed within "the fundamental policy of Indian law", namely, the contravention of a statute not linked to public policy or public interest, cannot be brought in by the backdoor when it comes to setting aside an award on the ground of patent illegality.

38. Secondly, it is also made clear that reappreciation of evidence, which is what an appellate court is permitted to do, cannot be permitted under the ground of patent illegality appearing on the face of the award.

39. To elucidate, para 42.[1] of Associate Builders[8], namely, a mere contravention of the substantive law oflndia, by itself, is no longer a ground available to set aside an arbitral award. Para 42.[2] of Associate Builders[8], however, would remain, for if an arbitrator gives no reasons for an award and contravenes Section 31(3) of the 1996 Act, that would certainly amount to a patent illegality on the face of the award.

40. The change made in Section 28( 3) by the Amendment Act really follows what is stated in paras 42.[3] to 45 in Associate Builders[8], namely, that the construction of the terms of a contract is primarily for an arbitrator to decide, unless the arbitrator construes the contract in a manner that no fair-minded or reasonable person would; in short, that the arbitrator's view is not even a possible view to take. Also, if the arbitrator wanders outside the contract and deals with matters not allotted to him, he commits an error of jurisdiction. This ground of challenge will now fall within the new ground added under Section 34(2-A).

41. What is important to note is that a decision which is perverse, as understood in paras 31 and 32 of Associate Builders, while no longer being a ground for challenge under "public policy of India", would certainly amount to a patent illegality appearing on the face of the award. Thus, a finding based on no evidence at all or an award which ignores vital evidence in arriving at its decision would be perverse and liable to be set aside on the ground of patent illegality. Additionally, a finding based on documents taken behind the back of the parties by the arbitrator would also qualify as a decision based on no evidence inasmuch as such decision is not based on evidence led by the parties, and therefore, would also have to be characterised as perverse."

16. In Delhi Airport Metro Express (P) Ltd. referring to the facets of patent illegality, this Court has held as under: (SCC p. 150, para 29)

permissible grounds for interference with a domestic award under Section 34(2-A) on the ground of patent illegality is when the arbitrator takes a view which is not even a possible one, or interprets a clause in the contract in such a manner which no fair-minded or reasonable person would, or if the arbitrator commits an error of jurisdiction by wandering outside the contract and dealing with matters not allotted to them. An arbitral award stating no reasons for its:findings would make itself susceptible to challenge on this account. The conclusions of the arbitrator which are based on no evidence or have been arrived at by ignoring vital evidence are perverse and can be set aside on the ground of patent illegality. Also, consideration of documents which are not supplied to the other party is a facet of perversity falling within the expression ―patent illegality‖.‖

79. The abovementioned precedents have settled the position of a challenge to an Arbitral Award. The facets under Section 34 of the Arbitration Act, specifically under Sub-section 2, provide the limited purview of such a challenge.

80. In order to set aside an Award under Section 34 the petitioner must show that illegality which has been alleged goes to the root of the matter and is not an illegality of trivial nature. In failure of the same the impugned Award cannot be held to be against the public policy. Award could also be set aside if it is so unfair and unreasonable that it shocks the conscience of the court. Such award is opposed to public policy and is required to be adjudged void.

81. To argue that the impugned Award before this Court is liable to set aside in the instant petition it has been argued that the findings of the learned Arbitrator are patently illegal and against the fundamental policy of India. As stipulated by the aforementioned precedents, the words are not to be construed in their plain meaning, but the essence to be appreciated while adjudicating a challenge under Section 34 of the Arbitration Act is that the illegalities or deficiencies are such that they are apparent on the face of record and/or shock the conscience of the Court and can in no manner be sustained. In the case at hand, the petitioner has not been able to show that the impugned Award suffers from such illegality that is apparent on the face of record and upholding the same would be against the law.

82. Therefore, as regards to Issue No. III, this Court is of the considered view that the petitioner has not been able to show that the grounds laid under Section 34 of the Arbitration Act for setting aside the impugned Award are made out on behalf of the petitioner. None of the finding of the learned Arbitrator is such that it shows that the impugned Award is patently illegal to shock the conscience of the Court, against public policy or fundamental policy of India or falls under the grounds laid down in Section 34 of the Arbitration Act.

CONCLUSION

83. The law settled by the Hon’ble Supreme Court with respect to Section 34 of the Arbitration Act leaves no scope for doubt that the enactment of the Arbitration Act and the amendments thereto have been carried out with the aim to promote resolution by way of alternative mechanisms and to limit interference of the Courts in the process of promoting this alternative mechanism of dispute resolution.

84. In the instant matter, the petitioner has failed to show that the impugned Award suffers from any patent illegality on the face of the record or that the grounds set out under Section 34 of the Arbitration Act are satisfied.

85. Therefore, after consideration of the material on record, including the impugned Arbitral Award, submissions on behalf of the parties this Court is of the view that there is no finding or conclusion reached by the learned Arbitrator which warrants interference of this Court. The petitioner has not been able to substantiate her case for setting aside of the impugned Award.

86. Accordingly, the instant petition is dismissed since there is no cogent reason to set aside the impugned Award.

87. Pending applications, if any, also stand dismissed.

88. The judgment be uploaded on the website forthwith.

JUDGE APRIL 26, 2023 gs/ms