Remedy Available Under Article 227 Of Constitution Does Not Stand Knocked Off By Non-Obstante Clause In Section 5 A&C Act: Delhi HC

The Court was hearing a challenge to the decision of the sole Arbitrator after it allowed the separate applications moved by the claimant under Order XI Rule 1 CPC and Order XI Rules 12 and 14 CPC.

The bench of Justice Manoj Jain observed, “…the remedy available under Article 227 of the Constitution of India does not stand knocked off by the non-obstante clause of Section 5 of Arbitration & Conciliation Act, 1996 which provides that no judicial authority shall intervene except where so provided…”

Advocate Divyakant Lahoti appeared for the Appellant and Advocate Amit George appeared for the Respondent.

Brief Facts-

In the present case, despite the agreements, the buyer alleged that the seller showed indifference from the beginning and never handed over possession of the plots, even after payments were made. The seller neither provided an update on the delay nor offered alternative plots or refunds. As a result, the buyer invoked arbitration, seeking either the execution of the transfer deed for the plots, possession of alternate plots, or compensation equivalent to the current market value, along with damages and litigation costs.

The Court referring to various judgments observed, “the scope of judicial interference under Article 227 of the Constitution of India, in context of orders passed in arbitral proceedings, is very compressed and restricted. The court should not interject unless, there is palpable element of “exceptional rarity” or “exceptional circumstance” or “extreme perversity” or if there is hint of any “bad faith”.

Accordingly, the Court dismissed both the Petitions.