TN-11

BEFORE

THE HON'BLE HIGH COURT OF KISHANGANJ

COMPLAINT FILED UNDER SECTION 6 OF THE CIVIL

PROCEDURE CODE OF INDIA, 1908

HYDEL MAESTRO CORP LIMITED

12 B.L. Sahana Road. Kishanganj, Mahanrashtra (Claimant)

AND

DEL AGRO SOLUTIONS PRIVATE LIMITED

221 Elvis Road, Patparganj, Mahanrashtra (Respondent)

WRITTEN SUBMISSION ON BEHALF OF THE RESPONDENT

 TABLE OF CONTENTS: -

SR NO TOPIC PG NO
I LIST OF ABBREVIATIONS 3

II INDEX OF AUTHORITIES 4

III STATEMENT OF JURISDICTION 7

IV STATEMENT OF FACTS 8

V STATEMENT OF ISSUES 10

VI SUMMARY OF ARGUMENTS 11

VII ARGUMENTS ADVANCED 13

VIII PRAYER 23

2
 I. LIST OF ABBREVIATIONS: -

ABBREVIATIONS MEANING

Sec. Section
Par. Paragraph
& And
A.I.R. All India Reporter
Anr. Another
Art. Article
H.C. High Court
Id. Ibid
Ltd. Limited
No. Number
Ors Others
Pg. Page
r/w Read with
Pvt. Private
S.C. Section
U.O.I. Union of India
V./ Vs Versus
Vol. Volume
SCC Supreme Court Cases
AC Appeal Cases
All er All India Reporter
Ld. Learned

3
 II. INDEX OF AUTHORITIES: -

LIST OF CASES

Sr. No. NAME OF THE CASES RELEVANT CITATION

1 Nanak Builders and Investors Pvt. Ltd. vs. Vinod AIR 1991 Delhi 315
Kumar Alag
2 Alka Bose vs Parmatma Devi & Ors AIR 2009 SC 1527 : 2009
AIR(SCW) 1030 : 2009 (3)
All.M.R. 447 : 2009 (4)
Mh.L.J. 1 : 2009 (3) MPLJ
128 : 2008 (16) Scale 281 :
2009 (2) SCC 582 : 2008 (17)
SCR 822
3 Sheela Gehlot vs. Sonu Kochar & Ors 2006(92) DRJ 498
4 M/S.Asrani Tubes Private Limited vs Tamil Nadu 5 April, 2017; S.A.No.931 of
Water Supply And Drainage board 2011
5 Nalamathu Venkaiya (Deceased By L.R) & Anr. v. 1-10- 1999 in O.S. No. 1046
B.S Neelkanta of 1994

6 Vimal Shah v. Dinesh Shah (2016) 8 SCC 788

7 Adarsh Kumar Khera vs Kewal Kishan Khera And 16 January, 2019; O.M.P.
Ors.
643/2007, CRL.M.As.
13622/2015, 2073/2017, I.A.
10911/2016, 12188/2016,
15856/2016, 1557/2017,
1562/2017 & 559/2019
8 India Yamaha Motor Pvt. Ltd. vs Divya Ashish 30 January, 2019; O.M.P.
Jamwal
1107/2012

9 Chintels India Ltd. vs Bhayana Builders Pvt. Ltd. 11 February, 2021; CIVIL
APPEAL NO. 4028 OF 2020

4
10 The Project Director, National Highways Authority Civil appeal number 2797;
SLP (CIVIL) NO. 13020 OF
of India v. M. Hakeem & Anr.
2022

5
 LIST OF BOOKS

Sr. No. Name of the Book Author

1 Law of Contracts (A study of the contract act, Avtar Singh

1872) and specific relief act
2 Law of Contracts Bare act with short comments Professional Book
Publishers
3 Avtar Singh’s Arbitration and Conciliation and Sourav Bindal
Alternative Dispute Resolution Systems
4 The Arbitration and Conciliation act, 1996. LexisNexis
Bare act; universals LexisNexis

LIST OF INTERNET SOURCES

Sr. No Name of the Site

1 www.wexisnexusindia.com

2 www.heinonline.com

3 www.scconline.com

4 www.ipleaders.in

6
 III. STATEMENT OF JURISDICTION: -

The Respondent has filed a petition with the Honourable High Court of Kishanganj,
Mahanrashtra, in accordance with Section 6 of the Civil Procedure Code, which establishes the
court's jurisdiction over pecuniary matters, and Section 16 of the Civil Procedure Code, which
establishes the court's jurisdiction over territorial matters.

7
 IV. STATEMENT OF FACTS: -

1. Hydel Maestro Corp is a newly formed private player in the agrarian economy of
Mahanrashtra. It intends to usher in a pivot to cash crops from the usual subsistence
farming most citizens are used to.

2. In its pursuit of quick expansion, the corporation has adopted unorthodox procedures
and practices that appear to be achieving remarkable success. Invigorated by their
pioneering track record with traditional cash crops such as cotton and jute, they've
decided to try their hand at establishing a sustainable winery.

3. Hydel Maestro Corp has been able to develop a variety of grape, resistant to the climatic
extremes of Mahanrashtra for which they credit their Chief Engineer Xavier
Sreenivasan. Such grapes however do not produce viable tannins for wine production
without adequate water, which the seasonal monsoons are unable to guarantee.

4. Del Agro Solutions is a Mahanrashtra based purveyor of quality irrigation solutions and
has more recently been at the forefront of global innovation hydroponics i.e., the
growing of plants without traditional soil. They have found great success in developing
massive olive groves for the extraction of olive oil at a commercially viable scale. Mr
Kulik Karnavati, their Chief Operations Officer, is credited for this success.

5. Hydel Maestro Corp and Del Agro Solutions struck a deal for the development of the
1st commercially viable vineyard in Mahanrashtra at the 2020 Dubai Expo, after
incidentally being situated in adjacent exhibition booths. The fine tuning and details of
this compact were transformed into a contract in February 2022 and work developing
the vineyard commenced. This contract was not executed at this time, with Del Agro
Solutions and Hydel Maestro Corp under the belief that it would be finalised and signed
after a site visit or similar undertaking.

6. The value of the EPC Contract was USD 700,000,000 ("Contract Price") in exchange
for which the Contractor was required to implement the Project in the following phases

8
 within six months (i) Design Phase and (ii) Procurement Phase. A portion of the
Contract Price was due upon completion of each of these two EPC Contract phases.

7. Everything was on track for the Design Phase to be finished by May 2022. This was
made possible by Hydel Maestro Corp's fast purchase of land.

8. Suddenly, Del Agro decided to terminate investment in the Hydel Maestro Corp project
due to non – fulfilment of the terms of contract. No delivery of the drip irrigation system
was to be expected. Repeated emails from Mr Xavier seeking clarification regarding
this turn of events received no response.

9. Hydel Maestro Corp invoked arbitration proceedings against Del Agro. A petition
under Section 11 of the Arbitration & Conciliation Act was filed before the High Court
of Kishanganj on 11th October 2022.
10. Del Agro objected to the petition's maintainability because there is no genuine
arbitration agreement. The judge referred the parties to arbitration, assigning a lone
arbitrator.

11. Throughout the arbitration proceedings, Del Agro contested Ld. Tribunal. The Tribunal
acknowledged and ruled that Section 16 Applications be heard during closing
arguments. Twenty-five arbitration hearings were held to resolve this dispute, with both
parties' CEOs cross-examined.

12. The Ld. Sole Arbitrator passed a detailed 'Final Award' running into 130 pages which
dealt with all arguments presented by the parties in detail and reasoning for the same
was also provided. During the final arguments neither party argued the Section 16
Application. The Tribunal concluded that it may not have jurisdiction in the instant
matter and referred the matter to the Court of Appeal for reconsideration.

13. Del Agro, thus challenged the observations made against it in the Final Award under
Section 34 on the grounds that there was no contract subsisting between the parties, that
the invocation of arbitration was premature and that the Section 16 petition ought to
have been decided as a preliminary issue.

9
14. The Claimant in response to the same has noted that an Application under Section 34
is not maintainable as the matter of contention is merely an Order under Section 16,
further that observations made against the Respondent are to be relied upon
subsequently by the Claimant and cannot be disregarded.

15. The Claimant has filed an application under Section 37 of the Arbitration and
Conciliation Act alleging that the Tribunal erred in stating that it has no jurisdiction.
The Respondent has objected to the maintainability of the petition. Both petitions have
been listed for final arguments before a bench of the High Court of Kishanganj,
Mahanrashtra.

10
 V. STATEMENT OF ISSUES: -

I. WHETHER THERE EXISTS A VALID CONTRACT BETWEEN THE TWO

PARTIES AND IF IT DOES, HAS IT BEEN BREACHED BY THE
RESPONDENT?

II. IS THE PETITION MAINTAINABLE UNDER SECTION 11 OF THE

ARBITRATION & CONCILIATION ACT BEFORE THE HIGH COURT OF
KISHANGANJ AND DOES THE Ld. ARBITRATOR HAVE VALID
JURISDICTION UNDER SECTION 16 OF THE ACT?

III. CAN THE ARBITRAL AWARD BE SET ASIDE UNDER SECTION 34 OF THE
ARBITRATION & CONCILIATION ACT AND CAN THE SAME BE
MODIFIED UNDER SECTION 37 OF THE ACT?

11
 VI. SUMMARY OF ARGUMENTS: -

I. WHETHER THERE EXISTS A VALID CONTRACT BETWEEN THE TWO

PARTIES AND IF IT DOES, HAS IT BEEN BREACHED BY THE
RESPONDENT?
The arguments presented regarding this matter make an attempt to demonstrate that the
Oral Agreement that was addressed at the Dubai Expo 2020 is Valid. There is no
difference in terms of the legality of an oral or written agreement. If an oral agreement
fulfils all of the standards outlined in Section 10 of the Indian Contract Act of 1872, its
legality cannot be questioned. In the most literal sense, it is not necessary for a contract
to be written, unless the parties voluntarily foresee the reduction of conditions of
agreement to writing. The agreement that was decided upon during the Dubai expo is
fully valid and enforceable by law. It fulfils all the essential requirements of a contract
as specified in the Indian Contracts Act of 1872. Nothing herein contained shall affect
any law in force in India, and not hereby expressly repealed, by which any contract is
required to be made in writing.
At the same time, it attempts to demonstrate that an agreement that has not been signed
is invalid. The Honourable High Court of Delhi outlined the criteria that must be met
before an unsigned contract may be considered legally binding. When all the following
indicators can be witnessed, the prepared contract that has not been signed can be
considered legally valid. In the case at hand, one of these indicators is missing. Breach
of contract has also been discussed and applied against the Claimant. Section 51 of the
Indian Contract act states that the Promisor is not bound to perform, unless reciprocal
promisee is ready and willing to perform. In the case of M/S.Asrani Tubes Private
Limited vs. Tamil Nadu Water Supply and Drainage board, the Hon'ble High Court of
Madras ruled that the respondents were not liable for breach of contract and
compensation. Claimants' refusal to offer arable land for the growing of grapes
compelled respondents to halt the transfer of necessary apparatus. The failure of the
claimants to do so constitutes a breach of their reciprocal obligation. In accordance with
Section 51 of the Indian Contract Act of 1872, the respondent cannot be held
accountable for non-performance.

12
 II. IS THE PETITION MAINTAINABLE UNDER SECTION 11 OF THE
ARBITRATION & CONCILIATION ACT BEFORE THE HIGH COURT OF
KISHANGANJ AND DOES THE Ld. ARBITRATOR HAVE VALID
JURISDICTION UNDER SECTION 16 OF THE ACT?
Under this issue, the non-maintainability of the petition filed by the Claimant under
Section 11 is discussed. Both Hydel Maestro Corp. and Del Agro Solutions have
verbally agreed to work together to purchase at least 50 acres of arable land, with the
potential for this number to increase to 120 acres during the next five years. In the
verbal agreement, there is no clause addressing the resolution of disputes or the
arbitration of disagreements. Because there is no legally binding agreement to arbitrate,
the petition cannot be submitted in accordance with Section 11, as required by the
statute. It also discusses the Jurisdiction of the Ld. Arbitrator under Section 16 of the
act.

III. CAN THE ARBITRAL AWARD BE SET ASIDE UNDER SECTION 34 OF

THE ARBITRATION & CONCILIATION ACT AND CAN THE SAME BE
MODIFIED UNDER SECTION 37 OF THE ACT?
Section 34 of Arbitration and Conciliation Act provides several grounds for challenging
an arbitral award. If a contract is void, the arbitration agreement will be declared void
as well. The arbitrator may set aside only that portion of the award, including decisions
on subjects not submitted to arbitration.
An appeal preferred under Section 37(1)(c) of the Arbitration and Conciliation Act,
1996 is maintainable and permissible against an order of a Civil Court. The petition is
not maintainable as an Award can be only challenged under Section 34 and not Section
37.

13
 VII. ARGUMENTS ADVANCED: -

I. WHETHER THERE EXISTS A VALID CONTRACT BETWEEN THE TWO

PARTIES AND IF IT DOES, HAS IT BEEN BREACHED BY THE
RESPONDENT?

1. Proving that the Oral Agreement is a Valid Contract

 There is no difference in terms of the legality of an oral or written agreement. If an
oral agreement fulfils all of the standards outlined in Section 10 of the Indian Contract
Act of 1872, its legality cannot be called into question.

 This means that an oral agreement cannot be held to be invalid.

 This was demonstrated by the Delhi High Court in the case of Nanak Builders and
Investors Pvt. Ltd. vs. Vinod Kumar Alag AIR 1991 Delhi 3151, in which the Court
ruled that even an oral agreement has the potential to be a legally binding and
enforceable contract.

 This finding was supported by the fact that the Delhi High Court. Therefore, in the
most literal sense, it is not absolutely necessary for a contract to be written, unless the
requirement is stipulated by law or the parties voluntarily foresee the reduction of
conditions of agreement to writing.

 In the case of Alka Bose vs. Parmatma Devi & Ors [CIVIL APPEAL NO(s) 6197
OF 2000]2, in which the Supreme Court declared that even a sale agreement might be
oral and have the same binding value and enforceability as a written agreement, the
same point was restated by the Supreme Court.

1
Nanak Builders and Investors Pvt. Ltd. vs. Vinod Kumar Alag AIR 1991 Delhi 315
2
Alka Bose vs Parmatma Devi & Ors 17 December, 2008; AIR 2009 SC 1527 : 2009 AIR(SCW) 1030 : 2009
(3) All.M.R. 447 : 2009 (4) Mh.L.J. 1 : 2009 (3) MPLJ 128 : 2008 (16) Scale 281 : 2009 (2) SCC 582 : 2008
(17) SCR 822

14
  In order for the oral agreement to have the same weight and evidentiary value as a
written one, it must conform to the requirements outlined in Section 10 of the Indian
Contract Act of 1872.

 Section 10 of the Indian Contract Act states that: “All agreements are contracts if they
are made by the free consent of parties competent to contract, for a lawful
consideration and with a lawful object, and are not hereby expressly declared to be
void. —All agreements are contracts if they are made by the free consent of parties
competent to contract, for a lawful consideration and with a lawful object, and are not
hereby expressly declared to be void." Nothing herein contained shall affect any law
in force in [India], and not hereby expressly repealed, by which any contract is
required to be made in writing or in the presence of witnesses, or any law relating to
the registration of documents3.

 Therefore, taking references from the cases that have been stated above and section
10 of the Indian Contract Act, 1872, which explicitly states that “Nothing herein
contained shall affect any law in force in, and not hereby expressly repealed, by which
any contract is required to be made in writing”4, it is clearly established that the
agreement that was decided upon during the Dubai expo is fully valid and enforceable
by law as it fulfils all of the essential requirements of a contract as specified in the
aforementioned section [Section 10 of the Indian Contracts Act of 1872].

2. Unsigned Contract is Void

 In the case of Sheela Ghelot vs. Sonu Kochar and Others5, which discusses the
legality of unsigned contracts, the Honourable High Court of Delhi outlined the
criteria that must be met before an unsigned contract may be considered legally
binding.

 When all of the following indicators can be witnessed, the prepared contract that has
not been signed can be considered legally binding.

3
Essentials of Contracts; Chapter II; Section 10, Indian Contracts Act, 1872
4
Ibid refer note 3
5
Sheela Gehlot vs. Sonu Kochar & Ors 2006(92) DRJ 498

15
 1. Each and every significant aspect of the contract has been thoroughly analysed
and debated upon in the past.
2. There is absolutely no room for negotiation.
3. The parties behaved as though they meant for the agreement to have legal
enforceability by acting upon it.

 In the case at hand, the second indicator or essential i.e. “There should not be any
room for negotiation” to consider the unsigned contract as valid has been breached
as the respondent demands 50 acres of "Arable6" land. “Arable” land is defined as a
land used for or right for growing crops.

 At the convention, when both parties agreed to the compact7, it was explicitly
specified that "Arable" land is required to cultivate a vineyard. But the unsigned
Contract8 remains silent regarding the type of Land. Therefore, there exists a room
for negotiation as the terms of the compact that were agreed by both the parties,
which has been proven Valid, are not explicitly replicated in the unsigned contract9.

3. Breach of Contract

 Section 5110 of the Indian Contract act states that the Promisor is not bound to
perform, unless reciprocal promisee is ready and willing to perform. This means that
when a contract consists of reciprocal promises to be simultaneously performed, the
promisor need not perform his promise unless the promisee is ready and willing to
perform his reciprocal promise11.

 A reading of Section 51 of the Indian Contract Act, 1872 would make it very clear
that a promisor need not be bound to perform his part of the contract, unless the
reciprocal promisee was ready and willing to perform their part.

6
Cambridge university official dictionary; https://dictionary.cambridge.org/dictionary/english/arable
7
Moot Proposition; Statement of Undisputed Facts; Para-7; (4th line "arable land").
8
Moot Proposition; Annex A (Excerpts of the Contracts) Clause 2; 2.1; (2.1(i)
9
Ibid refer note 7
10
Performance of reciprocal promises; CHAPTER IV; Promisor not bound to perform, unless reciprocal
promisee ready and willing to perform.; section 51; THE INDIAN CONTRACT ACT, 1872
11
Liability of party preventing event on which the contract is to take effect; Chapter IV (Performance of
reciprocal promises); section 51, Indian Contracts Act, 1872

16
  Even in the case of M/S.Asrani Tubes Private Limited vs. Tamil Nadu Water
Supply and Drainage board12, the Hon’ble High Court of Madras stated that
according to section 51 of the Indian contracts act, the Promisor is not bound to
perform, unless reciprocal promisee is ready and willing to perform. This is because
section 51 states that the Promisor is not bound to perform unless reciprocal
promisee is ready and willing to perform. As a result, the respondents were not found
responsible for breaching the contracts and failing to pay the required compensation.

 Similarly, in Nalamathu Venkaiya (Deceased By L.R) & Anr. v. B.S Neelkanta13,

Hon’ble High Court of Andhra Pradesh adjudged that the respondent will not be held
liable for any breach of contract and Compensation.

 The convention-made compact's legitimacy demonstrates the contract's "Arable"

land clause's validity as well. Therefore, the failure of the claimants to do the same
constitutes a breach of their reciprocal obligation, compelling the defendant to
discontinue all procurement-related activity. In accordance with Section 51 of the
Indian Contract Act of 1872, the respondent cannot be held accountable for non-
performance.

 Also, Claimant's refusal to offer arable land for the growing of grapes compelled
respondents to halt the transfer of necessary apparatus.

 Therefore, the promise’s action prevented the promisor from fulfilling his/her
obligation. The same is stated in Section 5314 of the Indian Contract Act of 187215
as it states the Liability of a party preventing event on which the contract is

12
M/S.Asrani Tubes Private Limited vs Tamil Nadu Water Supply And Drainage board 5 April, 2017;
S.A.No.931 of 2011
13
Nalamathu Venkaiya (Deceased By L.R) & Anr. v. B.S Neelkanta; 1-10- 1999 in O.S. No. 1046 of 1994
14
Performance of reciprocal promises; CHAPTER IV; Liability of party preventing event on which the contract
is to take effect; section 53; THE INDIAN CONTRACT ACT, 1872
15
Liability of party preventing event on which the contract is to take effect.; Chapter IV (Performance of
reciprocal promises); section 53, Indian Contracts Act, 1872

17
 to take effect. It means that when a contract contains reciprocal promises, and one
party to the contract prevents the other from performing his promise, the contract
becomes voidable at the option of the party so prevented; and he is entitled to
compensation from the other party for any loss which he may sustain in consequence
of the non-performance of the contract.

 Therefore, under section 53 as well, the respondent should not be held liable for any
breach of contract because they have the legal right to halt activities, i.e. not fulfil
their portion of the reciprocal promise.

II. WHETHER THE SECTION 11 PETITION IS MAINTAINABLE BEFORE THE

HIGH COURT OF KISHANGANJ AND DOES THE LD. ARBITRATOR
APPOINTED HAVE VALID JURISDICTION UNDER SECTION 16?

1) Whether the Section 11 Petition is maintainable before the high court of

Kishanganj?

 The contract mentioned in Annexure A16 is void in nature and hence cannot be legally
enforced.

 During the convention, both parties verbally agreed that Hydel Maestro Corp would
be responsible for the acquisition of at least 50 acres of arable land, expandable to 120
acres or more within five years, and that Del Agro Solutions would transfer
technology for its patented drip irrigation and temperature monitoring system for
vines17.
 There is no clause covering dispute resolution or arbitration in the verbal agreement.
The petition cannot be filed pursuant to Section 11 since there is no legitimate
agreement to arbitrate.

16
Moot Proposition; Annex A (Excerpts of the Contracts)
17
Ibid Refer note 7

18
  In accordance with Section 7 of the Arbitration Act, the court must determine whether
or not the purported arbitration agreement is legal and enforceable.

 In Vimal Shah v. Dinesh Shah (2016) 8 SCC 78818, it was held that not only are
disputes relating to a trust non-arbitrable by nature, but the so-called arbitration clause
in the Trust Deed, even though it exists, is not a valid and enforceable agreement in
terms of Section 7 of the Arbitration Act because there is no element of agreement,
offer and acceptance, meeting of the minds, or signature by both parties.

 Therefore, the petition is not maintainable under Section 11 since there is no valid
arbitration agreement.

 In arguendo, even if the parties were to adopt the contract referenced in Annexure –
A, Clause 25.1, it is obvious that 'In the event of a disagreement arising out of or
relating to this contract, the parties may first refer the matter to conciliation
(commonly known as mediation) with IAMC. If the disagreement cannot be resolved
amicably through IAMC, only then will it be referred to arbitration.

 Here, it is evident that the opposing side made no effort to send the disagreement to
IAMC for mediation. Instead directly choosing to file the section 11 petition in front
of the court, directly contravening the very grounds that they’re presenting.

2) Whether the Ld. Arbitrator appointed have valid Jurisdiction in the matter?

 Under Section 1619 of the Arbitration and Conciliation Act of 1996, the arbitral
tribunal has the right to choose its own jurisdiction in accordance with the notion of
kompetenz-kompetenz.

 According to Section 16, the arbitral tribunal has the authority to determine whether
it has jurisdiction to adjudicate the dispute. In addition, the arbitral tribunal has the

18
Vimal Shah v. Dinesh Shah (2016) 8 SCC 788
19
Competence of arbitral tribunal to rule on its jurisdiction.; Chapter IV (Jurisdiction of arbitral tribunals);
section 16, THE ARBITRATION AND CONCILIATION ACT, 1996.

19
 authority to rule on any challenge to the existence or validity of the arbitration
agreement.

 The argument that the arbitral tribunal lacks jurisdiction cannot be advanced after the
submission of the defence statement. The arbitral tribunal must rule on the above-
mentioned plea, and if it rejects the plea, it must continue the arbitral procedures and
issue an award.

 During the arbitration proceedings, the respondents, Del Agro filed a Section 16
application challenging the jurisdiction of Ld. Tribunal. The Tribunal took note of the
same and passed an Order stating that Section 16 Application would be taken up
during the final arguments stage.

 And at the end of the award the Ld. Sole Arbitrator took note of the Section 16
application and held that the Tribunal may not have jurisdiction in the instant matter.

 In accordance with the provisions of section 3420 of the Act, which is titled
"Application for setting aside arbitral award," a party who feels that they have been
wronged by an arbitral award can submit a request to have the award overturned by
filing an application with the court.

 It is in this light the Respondent proceeded to challenge the observations made against
itself in the Final Award under Section 34 on the grounds that there was no contract
subsisting between the parties, that the invocation of arbitration was premature and
that the Section 16 petition ought to have been decided as a preliminary issue.

III. CAN THE ARBITRAL AWARD BE SET ASIDE UNDER SECTION 34 OF

ACT AND CAN IT BE MODIFIED UNDER SECTION 37 OF THE ACT?

20
Application for setting aside arbitral award; Chapter VII (Recourse against arbitral award); Section 34, THE
ARBITRATION AND CONCILIATION ACT, 1996.

20
 1) Can the arbitral award be set aside under Section 34 of Arbitration and
Conciliation Act of 1996?

 Section 3421 of the Arbitration and Conciliation Act of 1996 specifies grounds for
challenging an arbitral award rendered under Section 31. Section 34(2)(a) and Section
34(2)(b) of the Arbitration and Conciliation Act, 1996 provide several grounds on
account of which the Court can set aside the arbitral award.

 The Respondent Del Agro contests the Section 34 observations made against it in the
Final Award on the grounds that there was no active contract between the parties, that
the invocation of arbitration was premature, and that the Section 16 petition should
have been decided as a preliminary matter.

 According to section 34(2)(a)(ii), In order for a contract to be enforceable, all of its

essential elements must be met. If the contract is void, the arbitration agreement will
be declared void as well, and the arbitral award can be revoked.

 In Adarsh Kumar Khera v. Kewal Kishan Khera, 200722, the arbitral award was set
aside since it was made without giving the parties a chance to be heard, it was deemed
void, and both parties wanted it overturned.

 The arbitral award will be challenged if it deals with an issue that is not addressed by
the arbitration agreement or contains decisions on subjects that are outside the scope
of the arbitration agreement. Also, if the judgments on items submitted to arbitration
can be differentiated from those not so submitted, only that portion of the arbitral
award, including decisions on subjects not submitted to arbitration, may be set aside.

 In India Yamaha Motor Pvt. Ltd. v. Divya Ashish Jamwal 201923, the arbitral award
was set aside because it was issued in violation of the contract’s provisions, without

21
Ibid refer note 18

22
Adarsh Kumar Khera vs Kewal Kishan Khera And Ors. 16 January, 2019; O.M.P. 643/2007, CRL.M.As.
13622/2015, 2073/2017, I.A. 10911/2016, 12188/2016, 15856/2016, 1557/2017, 1562/2017 & 559/2019

23
India Yamaha Motor Pvt. Ltd. vs Divya Ashish Jamwal; 30 January, 2019; O.M.P. 1107/2012

21
 taking into account relevant evidence on file, and based on assumptions. Further, in
Rulia Mal Amarchand v. Hindustan Petroleum Corporation Ltd. 2019, it was held that
the arbitrator should have limited himself to the problems and agreement that had been
presented for arbitration.

2) Can the arbitral award be modified under Section 37 of Arbitration and

Conciliation Act of 1996?

 The Arbitration and Conciliation Act, 1996 Section 3724 provides for filing of appeals
against orders of the Court or for that matter an Arbitrator.
 In Chintels India Limited v Bhayana Builders Private Limited, 202125 that an appeal
prefered under Section 37(1)(c) of the Arbitration and Conciliation Act, 1996 is
maintainable and permissible against an order of the Civil Court.

 The petition is not maintainable as an Award can be only challenged under Section 34
and not Section 37. Further, that the court under Section 37 does not have the power
to modify the award passed by the Arbitrator and relegate it to the same Tribunal.

 A party aggrieved by such an arbitral award may make an application for setting aside
such an arbitral award in accordance with section 34 of the Act which deals with
‘Application for setting aside arbitral award’.

 The Supreme Court laid down a significant judgment on 20th of July, 2021, in The
Project Director, National Highways Authority of India v. M. Hakeem & Anr.26, on
the scope of power of a court hearing a challenge to an arbitral award under Section

24
Appeals; CHAPTER IX; Appealable orders; section 37; THE ARBITRATION AND CONCILIATION ACT,
1996

25
Chintels India Ltd. vs Bhayana Builders Pvt. Ltd. 11 February, 2021; CIVIL APPEAL NO. 4028 OF 2020

26
The Project Director, National Highways Authority of India v. M. Hakeem & Anr.; Civil appeal number
2797; SLP (CIVIL) NO. 13020 OF 2022

22
 34 of the Arbitration and Conciliation Act, 1996. The Supreme Court reiterated that
there is no power under Section 34 to modify or vary an arbitral award.

 Although, Numerous appeals brought under Section 37 of the aforementioned Act

were resolved by a Division Bench of the Madras High Court, which established as a
matter of law that, at least with respect to arbitral awards made under the National
Highways Act of 1956, Section 34 of the Arbitration Act must be interpreted to allow
modification of an arbitral award made under the National Highways Act in order to
increase compensation awarded by an arbitrator27. It is very important to note that only
in this particular case modification of the Arbitral Award was allowed, that too under
Section 34 and not Section 37 of the Arbitration and Conciliation Act, 1996.

 But the Supreme Court noted that a Court cannot amend the arbitrator's award under
Sections 34 or 37 of the Arbitration and Conciliation Act28.

 Therefore, no modification can be done in the arbitral award under Section 34 or 37.

27
Sharma, D., 2022. Can Courts modify Arbitral Awards under S. 34 of Arbitration Act or is power limited? SC
decides | SCC Blog. [online] SCC Blog. Available at:
<https://www.scconline.com/blog/post/2021/07/22/arbitral-award-3/> [Accessed 17 September 2022].
28
NETWORK, L., 2022. Court Under Section 34,37 Arbitration Act Cannot Modify An Award ; It Can Only
Remand : Supreme Court. [online] Livelaw.in.
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 VIII. PRAYER: -

Therefore, in the light of the issues raised, arguments advanced, reasons given, and
authorities cited, it is humbly prayed before the Tribunal to adjudge and declare:

 To consider the unsigned contract between the respondent and claimant as Void and
the oral agreement as Valid.

 To relieve the respondent from any payable damages as demanded by the claimant.

 To dismiss the maintainability of claimant’s petition filed under sec 11.

 To set aside the Arbitral Award provided to the Claimant.

The Hon'ble High Court may also be pleased to pass any other order, which it may deem fit
in light of justice, equity, and good conscience.

And for this the Defendant, as is duty bound shall forever humbly pray.

All of which is respectfully submitted.

Sd/-

(Counsels for the Defendant)

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