Tag: Section 34

Illegal Memo Struck Down: Supreme Court Says Registration Certificate is Enough, No Need for Registrar’s Recommendation
3Mar By The Legal ChamberNo Comments
Supreme Court

Illegal Memo Struck Down: Supreme Court Says Registration Certificate is Enough, No Need for Registrar’s Recommendation

In this judgment, the Supreme Court held that executive mandates imposing superfluous requirements beyond statutory provisions constitute illegality in administrative law. It ruled that requiring a Cooperative Registrar's recommendation for stamp duty exemption under Section 9A of the Stamp Act is irrelevant and unnecessary, as a society's registration certificate is conclusive proof of its existence under Section 5(7) of the Cooperative Societies Act. Facts Of The Case: The appellant, Adarsh Sahkari Grih Nirman Swawalambi Society Ltd., a cooperative society registered under the Jharkhand Self-Supporting Cooperative Societies Act, 1996, challenged an executive memorandum issued by the Principal Secretary of the Registration Department, Jharkhand. The impugned Memo No. 494, dated Fe...
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Commercial Contracts & Interest Rates: Supreme Court Reaffirms ‘Party Autonomy’ Over ‘Public Policy’
3Mar By The Legal ChamberNo Comments
Supreme Court

Commercial Contracts & Interest Rates: Supreme Court Reaffirms ‘Party Autonomy’ Over ‘Public Policy’

The Supreme Court held that under Section 31(7)(a) of the Arbitration and Conciliation Act, 1996, party autonomy prevails; where a commercial contract specifies an interest rate, the arbitral tribunal has no discretion to deviate. A stipulated interest rate of 36% with monthly rests in a bill discounting agreement between equal bargaining parties is not unconscionable or against public policy. The rule of contra proferentem does not apply to mutually negotiated commercial contracts. Facts Of The Case: The dispute originated from a bill discounting facility extended by the respondent, Morgan Securities and Credits Private Limited, to M/s BPL Display Device Ltd (BDDL) and the appellant, BPL Limited, through sanction letters dated 27.12.2002 and 11.06.2003. The facility allowed BDDL to ...
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Supreme Court: Arbitrator Cannot Rewrite Contracts, Upholds IRCTC’s Catering Policy
28Jan By The Legal ChamberNo Comments
Supreme Court

Supreme Court: Arbitrator Cannot Rewrite Contracts, Upholds IRCTC’s Catering Policy

The Supreme Court held that an arbitral award which contravenes binding government policy circulars—incorporated into the parties' contracts—is patently illegal and in conflict with the public policy of India under Section 34(2A) of the Arbitration and Conciliation Act, 1996. An arbitrator cannot rewrite contractual terms that reflect such policy. Facts Of The Case: The case arose from contracts for catering services on premium Indian Railways trains (Rajdhani, Shatabdi, Duronto). The Railway Board initially increased meal tariffs in 2013 but simultaneously introduced a cheaper "combo meal" to replace the second regular meal on long journeys. This combo meal was swiftly discontinued days later, and caterers were directed to serve a second regular meal instead, but were to be reimbu...
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Supreme Court Sets Guidelines: What Constitutes an “Accidental Fire” for Insurance?
16Jan By The Legal ChamberNo Comments
Supreme Court

Supreme Court Sets Guidelines: What Constitutes an “Accidental Fire” for Insurance?

The Supreme Court held that in fire insurance claims, the precise cause of fire is immaterial unless fraud or instigation by the insured is proven. The insured is not required to prove the exact origin if the loss is due to fire. Exclusion clauses must be interpreted narrowly, and coverage provisions broadly, with ambiguities resolved in favor of the insured. Facts Of The Case: The case involves cross-appeals arising from a fire insurance claim dispute. Orion Commerx Pvt. Ltd. (the Insured) suffered a fire at its premises on September 25, 2010. The National Insurance Co. Ltd. repudiated the claim, primarily relying on the report of its final Surveyor, which concluded the fire was not accidental and originated from multiple sources, thus excluding it from policy coverage...
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Merely Buying Property Doesn’t Make You an Accused: Supreme Court Reiterates Legal Principle
27Dec By The Legal ChamberNo Comments
Supreme Court

Merely Buying Property Doesn’t Make You an Accused: Supreme Court Reiterates Legal Principle

The Supreme Court quashed criminal proceedings against the accused appellant, holding that no prima facie case was established under Sections 420, 406, and 34 of the IPC. The Court ruled that mere subsequent purchase of property from a co-accused, without allegation of inducement or involvement in the initial fraudulent transaction, does not attract criminal liability for cheating or criminal breach of trust. Facts Of The Case: The case originates from an FIR filed by Ms. Amutha in October 2022 against Gunasekaran (Accused No. 1) for offences under Section 420 of the IPC. She alleged that in 2015, Gunasekaran fraudulently represented himself as the owner of a vacant plot, inducing her into an unregistered sale agreement for ₹1.64 crore. She paid substantial sums totaling ₹92 lakhs ...
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No Waiver Without Clear Intent: Supreme Court Sets Aside Arbitral Award for Violating ‘No Oral Modification’ Clause
27Nov By The Legal ChamberNo Comments
Supreme Court

No Waiver Without Clear Intent: Supreme Court Sets Aside Arbitral Award for Violating ‘No Oral Modification’ Clause

This Supreme Court judgment underscores the narrow scope of judicial intervention under Sections 34 and 37 of the Arbitration and Conciliation Act, 1996. It affirms that an arbitral award can be set aside if it violates the fundamental policy of Indian law, principles of natural justice, or the terms of the contract, or if it exhibits patent illegality or perversity that shocks the conscience of the court. The Tribunal must adjudicate within the contractual framework and cannot rewrite the agreement. Facts Of The Case: The dispute arose between SEPCO Electric Power Construction Corporation, an EPC contractor, and GMR Kamalanga Energy Ltd., the project owner, concerning the construction of thermal power plants in Odisha. Following delays and disagreements, SEPCO demobilized from the site ...
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Supreme Court Landmark Ruling: Limitation Issues in Arbitration Must Get a Full Hearing
5Nov By The Legal ChamberNo Comments
Supreme Court

Supreme Court Landmark Ruling: Limitation Issues in Arbitration Must Get a Full Hearing

In a significant ruling, the Supreme Court held that a preliminary issue of limitation, being a mixed question of law and fact, cannot be permanently foreclosed by an arbitrator based on a demurrer. The Court clarified that such a decision on demurrer is not a final adjudication on merits and does not preclude a subsequent examination based on evidence, as it would violate the fundamental mandate of Section 3 of the Limitation Act, 1963. Facts Of The Case: The dispute arose from a Share Subscription Agreement (SSA) dated 23.07.2008 between Urban Infrastructure Real Estate Fund (Petitioner) and Neelkanth Realty Pvt. Ltd. (Respondent). The Petitioner invested Rs. 25 Crore, with a clause stipulating a refund if certain "Conditions Precedent" were not fulfilled within 90 days. The Respondent...
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Supreme Court Overrules Precedent on Power of Attorney Validity in Property Sales
11Aug By The Legal ChamberNo Comments
Supreme Court

Supreme Court Overrules Precedent on Power of Attorney Validity in Property Sales

The Supreme Court examined the validity of documents executed by a Power of Attorney (PoA) holder under the Registration Act, 1908. It held that a PoA holder remains an agent, not an "executant" under Section 32(a), and must comply with Sections 32(c), 33, 34, and 35 for authentication. The court disagreed with the earlier Rajni Tandon ruling, emphasizing that a PoA holder cannot bypass statutory scrutiny while executing or presenting documents for registration. The issue was referred to a larger bench for clarity. Facts Of The Case: The case revolves around the validity of an Irrevocable General Power of Attorney (GPA) dated 15.10.1990, allegedly executed by Ranveer Singh and his wife, Gyanu Bai, in favor of their tenant, G. Rajender Kumar. Using this GPA, Rajender Kumar executed three ...
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Supreme Court Clarifies: When Can an Arbitral Award Be Challenged for Lack of Jurisdiction?
22May By The Legal ChamberNo Comments
Supreme Court

Supreme Court Clarifies: When Can an Arbitral Award Be Challenged for Lack of Jurisdiction?

The Supreme Court ruled that an arbitral award under the Arbitration and Conciliation Act 1996, cannot be annulled solely for lack of jurisdiction if no plea was raised before the tribunal under Section 16(2). It harmonized conflicting precedents, holding that objections under Section 34 must show strong grounds, and upheld the finality of awards where jurisdictional challenges were untimely. The judgment clarifies that the Madhya Pradesh Arbitration Act 1983, does not automatically override arbitration agreements unless jurisdictional objections are raised at the appropriate stage. Facts Of The Case: The case involved a contractual dispute between M/s Gayatri Projects Limited and Madhya Pradesh Road Development Corporation regarding road construction works in Madhya Pradesh. The parties...
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