Court's Discretion - The Legal Chamber

This Supreme Court judgment clarifies the limited scope of judicial interference with arbitral awards under the Arbitration and Conciliation Act, 1996. The Supreme Court held that an arbitrator's discretion to award a contractual interest rate of 24% is not per se usurious or against public policy. It reaffirmed that courts cannot reappreciate evidence and may only set aside an award on the narrow, specified grounds under Section 34 of the Act, which were not met in this case. Facts Of The Case: The appellants, M/s Sri Lakshmi Hotels Pvt. Limited and its Managing Director, availed two loans totaling ₹1.57 Crore from the respondent Non-Banking Financial Company (NBFC) in 2006. The loan agreements stipulated an interest rate of 24% per annum. After making partial repayments until April 200...

The Supreme Court of India quashed criminal proceedings against the Appellant, finding that the alleged sexual assault and unnatural sex charges under Sections 376, 376(2)(n), 377, 504, and 506 of the IPC were not established. The Court held that the relationship was consensual, not based on a false promise to marry, and the complaint was likely motivated by a "disgruntled state of mind". The case fell under categories for quashing criminal proceedings to prevent abuse of process of law. Facts Of The Case: This appeal arises from the dismissal of Amol Bhagwan Nehul's petition to quash Criminal Case C.R. No. 490/2023, registered on July 31, 2023, for alleged offenses under Sections 376, 376(2)(n), 377, 504, and 506 IPC. The Complainant, Respondent No. 2, alleged that the Appellant forci...

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Arbitrator’s Power on Interest Rates: Supreme Court Explains Key Legal Limits