Summary
The Court reversed Article 227 interference with an appellate order sustaining an arbitrator’s interim stay of ONGC’s two-year ban. Constitutional supervision survived the Arbitration Act, but required exceptional restraint consistent with limited appeals and minimal intervention. A dispute about arbitral jurisdiction or a possible error in granting injunction was not patent inherent lack of jurisdiction. The High Court had also improperly revisited a rejected Section 16 objection before the award stage.
Issues
- When Article 227 intervention is permissible after a Section 37 arbitration appeal.
- Whether the disputed ban order and alleged injunction error established inherent lack of arbitral jurisdiction.
Provisions considered
- Sections 5 and 37, Arbitration and Conciliation Act, 1996Minimal intervention, specified first appeals and the bar on second appeals required extreme restraint in constitutional supervision. (¶¶ 10, 11, 12, 13, 14, 15, 17, 18)
Held
- Article 227 remained constitutionally available despite Section 5, but interference with a Section 37 appellate order was to be extremely circumspect and restricted to patent lack of inherent jurisdiction. It could not function as a further merits appeal. (¶¶ 10, 11, 12, 13, 14, 15, 17, 18)
- Rejection of a Section 16 jurisdiction objection ordinarily awaited challenge to the final award under Section 34. The High Court inverted that scheme by revisiting the same notice-of-arbitration issue while examining the interim-measure appeal. (¶¶ 5, 16)
- The ban emanated from the contractual relationship, and the tribunal acted within jurisdiction in considering it and granting interim relief. Serious disputes about jurisdiction did not themselves establish inherent incompetence; an assumed injunction-law error would remain an error of law. (¶¶ 3, 4, 5, 6, 16)
- The statutory policy required the arbitration to proceed expeditiously after removal of the improper supervisory interference. (¶¶ 17, 18, 19)
Result
Appeal allowed without costs. High Court judgment set aside, leaving the order sustaining arbitral interim protection in place. Arbitration directed to be disposed of as expeditiously as possible in accordance with the Act.