Order Not So Perverse To Shock The Conscious Of Court: Delhi HC Dismisses Petition Under Article 227 Of Constitution Against Arbitrator’s Order
|The Delhi High Court declined to interfere with an arbitrator’s order in the exercise of its jurisdiction under Article 227 of the Constitution holding that the said order was not “so perverse so as to shock the conscious” of the Court.
The petitioner, Oriel Financial Solutions Private Limited, had approached the Court challenging an order passed by an arbitrator. The order rejected an application under Section 16 of the Arbitration and Conciliation Act, 1996, stating that the dispute between the parties was not arbitrable because their contract was void ab initio.
A Single Bench of Justice Subramonium Prasad observed, “A perusal of the abovementioned Order shows that the Arbitrator has yet not fully closed the issue and has decided to adjudicate on the issue after evidence is led on the same issue…The scope of interference while exercising jurisdiction under Article 227 of the Constitution of India under the Arbitration and Conciliation Act is well settled.”
Advocate Kamal Sehgal represented the petitioner, while Advocate Raghavendra Mohan Bajaj appeared for the respondent.
The Court relied on the Supreme Court’s decision in Estralla Rubber v. Dass Estate Private Limited, 2001 (8) SCC 97 to reiterate the scope of interference while exercising jurisdiction under Article 227 of the Constitution for arbitration matters. The Supreme Court in the said decision had held that the High Court's intervention was limited to cases of serious dereliction of duty or flagrant violation of fundamental principles of law or justice. The High Court cannot act as an appellate court or substitute its judgment unless the lower court's decision was so perverse that no reasonable person could come to such a conclusion.
Accordingly, the High Court dismissed the writ petition.
Cause Title: Oriel Financial Solutions Private Limited v. Bestech Advisors Private Limited (Neutral Citation: )
Appearance:
Petitioner: Advocates Kamal Sehgal, Satinder Singh Gulati and Charanjit Lal
Respondent: Advocates Raghavendra Mohan Bajaj and Shagun Agarwal