Section 37 of the Arbitration and Conciliation Act of 1996 encompasses provisions for appealing against specified orders issued by the court or the arbitral tribunal itself under various sections of the same act. These sections include 8, 9, 16, 17, and 34. However, unlike Section 34, Section 37 does not specify a limitation period for filing an appeal. This lack of clarity has led to conflicting judgments by the Indian Supreme Court and various High Courts.
Factors Governing Appeals under Section 37 of the Arbitration and Conciliation Act, 1996
An essential criterion for permitting an appeal under Section 37 of the Arbitration and Conciliation Act is that the appeal should emanate from an order of a court. According to Section 37, an appeal can be lodged from orders to a court authorized by law to hear appeals from the original decrees of the court that issued the order.
This appeal can extend to orders from either the court authorized to hear appeals from the original decrees of the issuing court or to a court based on an order from the arbitral tribunal under sections such as 8, 9, 16, 17, 18, and 34.
It's important to note that the Arbitration and Conciliation Act does not permit a second appeal from an order arising from an appeal under Section 37. Nonetheless, the parties involved in arbitration possess the right to appeal to the Supreme Court of India.
Time Limitation for Filing Appeals under Section 37 of the Arbitration and Conciliation Act, 1996
Section 37 of the Arbitration and Conciliation Act, 1996 facilitates appeals against specific designated orders from the court or arbitral tribunal as outlined in sections 9, 34, 16, and 17 of the Act.
The Limitation Act of 1963
Article 116 of Schedule 1 within the Limitation Act of 1963 prescribes a 90-day timeframe for initiating an appeal in any court. Section 5 of the Limitation Act establishes that an appeal submitted beyond the prescribed 90-day period by providing satisfactory reasoning.
In the Consolidated Engineering Enterprises and Ors. vs. Principal Secretary Irrigation Department and Ors. (2008), a three-judge bench of the Indian Supreme Court affirmed that the provisions of the Limitation Act of 1963 are applicable to proceedings under the Arbitration and Conciliation Act, unless explicitly excluded by the Act. This precedent was followed by the division bench of the High Court of Bombay in ONGC Limited vs. M/s Dinamic Corporation (2008). The ONGC case elucidated that the limitation period for appealing under Section 37 of the Arbitration and Conciliation Act is as follows:
The Commercial Courts Act of 2015
In 2015, the government enacted the Commercial Courts Act of 2015, which led to the transfer of pending arbitration cases related to commercial disputes meeting specified value criteria to commercial courts. Section 13 of the Commercial Courts Act stipulates that a person aggrieved by a judgment or order from a Commercial Court below the level of a District Judge can appeal to the Commercial Appellate Court within 60 days from the date of the judgment or order. This indicates a 60-day limitation period for filing appeals in the commercial court appellate division.
Standard of Review Pursuant to Section 37 of the Arbitration and Conciliation Act, 1996
In accordance with Section 34(2A) of the Arbitration and Conciliation Act, concerning cases involving domestic arbitrations, the breach of the public policy of the Indian government encompasses instances of patent illegality evident on the award's surface. When addressing appeals under Section 37 of the Arbitration and Conciliation Act, the tribunal hearing the appeal does not function as an appellate court for the award issued by the arbitral tribunal. It refrains from reevaluating evidence, re-adjudicating matters, or reappraising the subject, as the provisions explicitly state that an award cannot be invalidated solely due to erroneous application of the law or reevaluation of evidence.
Upon analyzing legal precedents, it is evident that a court exercising appellate jurisdiction under Section 37 of the Act is not empowered to independently assess the merits of an award. Instead, its role is to ensure that, while exercising its authority under Section 34 of the Arbitration and Conciliation Act, it remains within the scope of the provision. Consequently, courts operating under Section 37 of the Arbitration and Conciliation Act exercise caution and reluctance in overturning tribunal decisions. Several justifications underpin this limited judicial intervention.
One prominent rationale for the court's restricted involvement is a well-established principle: the arbitrator holds ultimate authority over the relevance and weight of evidence when delivering the award. As long as the arbitrator's approach is devoid of arbitrariness or capriciousness, their determination is conclusive on factual matters. This principle was affirmed in the case of Anglo American Metallurgical vs MMTC Ltd (2020). Preserving the fundamental purpose of alternative dispute resolution processes would be undermined if appellate courts interfered with award merits as a procedural matter.
