Application for setting aside arbitral awards
Section 34 of the Arbitration and Conciliation Act, 1996 deals with application for setting aside arbitral awards. Recourse to a Court against an arbitral award may be made only by an application for setting aside such award in accordance with sub-section (2) and sub-section (3). The Act came into force on 22 Aug 1996.
(1) Recourse to a Court against an arbitral award may be made only by an application for setting aside such award in accordance with sub-section (2) and sub-section (3).
(2) An arbitral award may be set aside by the Court only if--
(a) the party making the application 1[establishes on the basis of the record of the arbitral tribunal that]--
(i) a party was under some incapacity, or
(ii) the arbitration agreement is not valid under the law to which the parties have subjected it or, failing any indication thereon, under the law for the time being in force; or
(iii) the party making the application was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present his case; or
(iv) the arbitral award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration:
Provided that, if the decisions on matters submitted to arbitration can be separated from those not so submitted, only that part of the arbitral award which contains decisions on matters not submitted to arbitration may be set aside; or
(v) the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties, unless such agreement was in conflict with a provision of this Part from which the parties cannot derogate, or, failing such agreement, was not in accordance with this Part; or
(b) the Court finds that--
(i) the subject-matter of the dispute is not capable of settlement by arbitration under the law for the time being in force, or
(ii) the arbitral award is in conflict with the public policy of India.
1[Explanation 1.--For the avoidance of any doubt, it is clarified that an award is in conflict with the public policy of India, only if,--
(i) the making of the award was induced or affected by fraud or corruption or was in violation of section 75 or section 81; or
(ii) it is in contravention with the fundamental policy of Indian law; or
(iii) it is in conflict with the most basic notions of morality or justice.
Explanation 2.--For the avoidance of doubt, the test as to whether there is a contravention with the fundamental policy of Indian law shall not entail a review on the merits of the dispute.]
2[(2A) An arbitral award arising out of arbitrations other than international commercial arbitrations, may also be set aside by the Court, if the Court finds that the award is vitiated by patent illegality appearing on the face of the award:
Provided that an award shall not be set aside merely on the ground of an erroneous application of the law or by reappreciation of evidence.]
(3) An application for setting aside may not be made after three months have elapsed from the date on which the party making that application had received the arbitral award or, if a request had been made under section 33, from the date on which that request had been disposed of by the arbitral tribunal:
Provided that if the Court is satisfied that the applicant was prevented by sufficient cause from making the application within the said period of three months it may entertain the application within a further period of thirty days, but not thereafter.
(4) On receipt of an application under sub-section (1), the Court may, where it is appropriate and it is so requested by a party, adjourn the proceedings for a period of time determined by it in order to give the arbitral tribunal an opportunity to resume the arbitral proceedings or to take such other action as in the opinion of arbitral tribunal will eliminate the grounds for setting aside the arbitral award.
3[(5) An application under this section shall be filed by a party only after issuing a prior notice to the other party and such application shall be accompanied by an affidavit by the applicant endorsing compliance with the said requirement.
(6) An application under this section shall be disposed of expeditiously, and in any event, within a period of one year from the date on which the notice referred to in sub-section (5) is served upon the other party.]
STATE AMENDMENTS
Jammu and Kashmir and Ladakh (UTs).--
Amendment of section 34.--
(i) after sub-section (2), insert the following sub-section, namely:--
"(2A) An arbitral award may also be set aside by the Court, if the Court finds that the award is vitiated by patent illegality appearing on the face of the award:
Provided that an award shall not be set aside merely on the ground of an erroneous application of the law or by re-appreciation of evidence.";
(ii) in sub-section (3),--
(i) for "three months" substitute, "six months";
(ii) in proviso thereto, for, "three months" and "thirty days" substitute respectively "six months" and "sixty days".
[Vide the Jammu and Kashmir Reorganization (Adaptation of Central Laws) Order, 2020, notification No. S.O. 1123(E) dated (18-3-2020) and Vide Union Territory of Ladakh Reorganisation (Adaptation of Central Laws) Order, 2020, notification No. S.O. 3774(E), dated (23-10-2020).]
Section 34, The Arbitration and Conciliation Act, 1996 (Act 26 of 1996).
Cross-references
Extracted from the operative text of the enactments themselves. Every destination below exists in our corpus.
This section refers to
Referred to by 8
- Andhra Pradesh Court-fees and Suits Valuation Act s. 79 Repeal and saving
- s. 8 Power to refer parties to arbitration where there is an arbitration agreement
- s. 13 Challenge procedure
- s. 16 Competence of arbitral tribunal to rule on its jurisdiction
- s. 32 Termination of proceedings
- s. 36 Enforcement
- s. 37 Appealable orders
- Telangana Court-fees and Suits Valuation Act s. 79
Related judgements & precedents
These are some judgments that construed this section, and hold precedence value. They hold authority on how to read, interpret and use this section.
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Gayatri Balasamy v. ISG Novasoft Technologies Ltd.
Court's Decision & Legal Precedent
Courts have a limited power to modify arbitral awards under section 34; they may sever, correct clerical errors, and modify post-award interest. Constitution Bench 4:1.
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Lindsay International Pvt. LTD vs Ifgl Refractories Limited
Court's Decision & Legal Precedent
When a party raises a prima facie objection to the existence or validity of an arbitration agreement, the court must apply a narrow examination limited to: (1) whether the agreement is in writing or contained in exchange of letters/telecommunication; (2) whether the core contractual ingredients of the arbitration agreement are fulfilled; and (3) only in rare cases, whether the subject matter is arbitrable. If the court cannot determine on a prima facie basis that no valid arbitration agreement exists, it must refer the matter to arbitration, applying the principle 'when in doubt, refer to arbitration.' The arbitral tribunal itself is empowered to decide questions of its own jurisdiction and arbitrability, subject to parties' right to challenge such decisions under Section 34.
On this section: Remedy available to parties to challenge arbitration award; parties' liberty to pursue remedies under this section if dissatisfied with tribunal's jurisdiction decision
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Bhandari Udyog LTD vs Industrial Facilitation Council
Court's Decision & Legal Precedent
An application under Section 34 of the Arbitration and Conciliation Act, 1996 for setting aside an arbitral award must be filed before the court subordinate to the same High Court that referred the matter to arbitration under Section 11. Where the arbitration was conducted within the jurisdiction of a court subordinate to one High Court, an application under Section 34 cannot be entertained by a court subordinate to a different High Court, as this would violate Section 42 of the Act and the principle of exclusive jurisdiction established through the arbitration agreement and the place of conduct of arbitration. General jurisdictional provisions of the Code of Civil Procedure (Sections 15-20) do not override this principle where an exclusive jurisdiction agreement is established.
On this section: Provision allowing applications to set aside or challenge an arbitral award; the court entertaining the Section 11 application has jurisdiction over Section 34 applications
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State of Chhattisgarh vs Sal Udyog(p) LTD through Managing Director
Court's Decision & Legal Precedent
When an arbitrator fails to decide in accordance with the express terms of a contract governing the parties, such failure amounts to patent illegality appearing on the face of the award which goes to the root of the matter and warrants judicial interference. Specifically, when clear contractual provisions stipulating recovery of supervision charges are completely ignored by an arbitrator without addressing the contractual terms or relevant governmental circulars implementing those terms, such ignoring constitutes gross contravention of Section 28(3) of the Arbitration and Conciliation Act, 1996, which mandates the Arbitral Tribunal to decide in accordance with the terms of the contract. Additionally, grounds constituting patent illegality can be invoked by courts suo moto under Section 34(2-A) in an appeal under Section 37, even if such grounds were not explicitly specified in the original Section 34 petition, provided the issue was raised before the Arbitrator and noted in the High Court order.
On this section: Grounds for setting aside arbitral award. Court examined scope of Section 34 petition and patent illegality provision.
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Kinnari Mullick vs Ghanshyam Das Damani
Court's Decision & Legal Precedent
The power vested in courts under Section 34(4) of the Arbitration and Conciliation Act, 1996 is limited to adjourning proceedings before setting aside an arbitral award upon written request by a party to the arbitration, to allow the arbitral tribunal an opportunity to resume proceedings or take curative action. Courts possess no power to remand or relegate matters to the arbitral tribunal after the award has been set aside, and any such remand cannot be ordered suo moto.
On this section: Central provision analyzed to determine whether court has power to remit matters to arbitral tribunal after award is set aside. Court held that power is limited to adjourning proceedings (not remitting post-award) and can only be exercised upon written request by a party.
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Bharat Aluminium Co. LTD vs Kaiser Aluminium Technical Services INC
Court's Decision & Legal Precedent
Where parties to an international commercial arbitration expressly choose a foreign law (other than Indian Law) to govern their arbitration agreement through clear and unambiguous contract terms, Part I of the Arbitration and Conciliation Act, 1996 stands excluded by necessary implication. Consequently, applications under Section 34 of the Indian Arbitration Act cannot be maintained to challenge arbitral awards made in proceedings governed by such foreign law, particularly when the seat of arbitration is outside India. The principle of party autonomy permits parties to agree on different governing laws for the contract itself, the arbitration agreement, and the conduct of arbitration, and such agreements are enforceable and binding on the parties.
On this section: The Court held that Part I of the Act does not apply to arbitrations held outside India where the arbitration agreement is governed by foreign law. Section 34 applications are therefore not maintainable against foreign awards when the proper law of the arbitration agreement is English Law.
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P. Radha Bai vs P. Ashok Kumar
Court's Decision & Legal Precedent
Section 17 of the Limitation Act, 1963 is expressly excluded from application to Section 34(3) of the Arbitration and Conciliation Act, 1996. The express exclusion is inferred from the language of Section 34(3), particularly the phrase 'but not thereafter' which creates an absolute outer boundary of 120 days for challenging arbitral awards. This exclusion is also necessarily implied from the scheme and object of the Arbitration Act, which is to provide speedy dispute resolution with finality and certainty of awards. Once a party receives an arbitral award, the three-month limitation period commences, and subsequent fraud or mistake by the other party cannot defer the commencement of this period or extend the outer 120-day boundary. The principle of 'unbreakability' of the limitation period, enshrined in the UNCITRAL Model Law, precludes any extension beyond the prescribed period.
On this section: Application for setting aside arbitral award; central provision; Section 34(3) prescribes three-month limitation with 30-day extension for sufficient cause, but not thereafter
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Narayan Prasad Lohia vs Nikunj Kumar Lohia
Court's Decision & Legal Precedent
The prohibition on even number of arbitrators under Section 10 of the Arbitration and Conciliation Act 1996 is a derogable provision. When read conjointly with Section 16, which permits parties to challenge tribunal composition before the arbitral tribunal itself (not later than submission of statement of defence), the requirement of odd number of arbitrators becomes derogable. A party who knowingly agrees to an even number of arbitrators and participates in the arbitration proceedings without raising an objection to the tribunal composition within the prescribed timeline under Section 16(2) is deemed to have waived the right to object under Section 4. Consequently, an arbitral award made by two arbitrators cannot be set aside merely on the ground that it violates Section 10 if the composition was in accordance with the agreement of the parties and no objection was raised before the arbitral tribunal. Section 34(2)(a)(v) permits setting aside an award on grounds of improper composition only if the composition was not in accordance with the agreement of the parties.
On this section: Analyzed to establish the limited grounds for setting aside awards. The Court held that Section 34(2)(a)(v) only permits challenge if composition is not in accordance with party agreement, not merely because it violates the Act.
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Raman Prakash Mangla vs Anuj Jain
Court's Decision & Legal Precedent
The Adjudicating Authority has limited jurisdiction in approving a resolution plan, circumscribed by Sections 30(2) and 31 of the Insolvency and Bankruptcy Code, 2016. The Authority cannot interfere with the commercial aspects of the decision taken by the Committee of Creditors. If the Adjudicating Authority finds shortcomings in the resolution plan vis-à-vis the specified parameters of keeping the corporate debtor as a going concern, maximizing the value of its assets, and taking care of interests of all stakeholders, it must send the plan back to the Committee of Creditors for reconsideration, not modify the plan itself. Payment to dissenting financial creditors must be in monetary terms, not in kind or through transfer of equity or land. Once homebuyers as a class vote in favor of a resolution plan through their authorized representative, individual homebuyers cannot challenge the plan as dissenting creditors or aggrieved persons. The INR 750 crores deposited by the holding company pursuant to Supreme Court orders in Chitra Sharma is the property of the holding company, not the corporate debtor, and cannot be appropriated by the corporate debtor or the resolution applicant.
On this section: Challenge to arbitral award
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Madhav Saran Agarwal vs Msx Mall Pvt. LTD
Court's Decision & Legal Precedent
Section 138/141 proceedings under the Negotiable Instruments Act against a corporate debtor are covered by the moratorium provision in Section 14(1)(a) of the Insolvency and Bankruptcy Code, 2016, as such proceedings relate to transactions evidencing debt of the corporate debtor and result in depletion of its assets through compensation orders, thereby directly impacting the object of the moratorium which is to preserve the corporate debtor's assets during the insolvency resolution process so it can continue as a going concern and be rehabilitated. However, the moratorium applies only to the corporate debtor and not to natural persons (Directors/officers) in charge of and responsible for the conduct of the business of the corporate debtor, who remain liable to prosecution under Section 138/141 as the corporate debtor is a necessary party to such proceedings.
On this section: Cited to show that Section 34 proceedings are covered by Section 14 moratorium
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Naresh Kumar Gupta vs Sood Resins and Polymers
Court's Decision & Legal Precedent
Section 138/141 proceedings under the Negotiable Instruments Act against a corporate debtor are covered by the moratorium provision in Section 14(1)(a) of the Insolvency and Bankruptcy Code, 2016, as such proceedings are 'proceedings' within the meaning of that section. The moratorium applies only to the corporate debtor and not to natural persons (Directors and officers) who can continue to be prosecuted under Section 141 of the Negotiable Instruments Act. The rules of statutory construction (noscitur a sociis and ejusdem generis) cannot be applied to restrict the meaning of 'proceedings' in Section 14(1)(a) when the expression is designedly wide and the object of the statute is clear - which is to preserve the corporate debtor's assets during the insolvency resolution process.
On this section: Cited in context of whether Section 14 applies to arbitration proceedings
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Sare Shelters Project Private Limited vs Union of India
Court's Decision & Legal Precedent
Real estate allottees are financial creditors within the meaning of Section 5(8)(f) of the Insolvency and Bankruptcy Code, 2016 because amounts advanced by allottees are disbursed against consideration for time value of money and have the commercial effect of a borrowing. The amendments to the Code effected through the Insolvency and Bankruptcy Code (Second Amendment) Act, 2018, which explicitly clarify that allottees are financial creditors through an explanation to Section 5(8)(f) and provide representation mechanisms through Sections 21(6A) and 25A, do not violate Articles 14, 19(1)(g) read with 19(6), or 300-A of the Constitution of India. These amendments are constitutional as they satisfy the test of reasonable classification, are based on intelligible differentia having rational nexus with legislative object, do not constitute manifest arbitrariness, and represent a legitimate economic experiment to which legislature must be given play in the joints.
On this section: Referenced regarding interpretation of directory versus mandatory procedural provisions
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Landmark Apartments Pvt. LTD vs Union of India
Court's Decision & Legal Precedent
Allottees of real estate projects are financial creditors under Section 5(8)(f) of the Insolvency and Bankruptcy Code, 2016, as they finance projects through advance payments having the commercial effect of borrowing. The amendments to the Code treating allottees as financial creditors do not violate Articles 14, 19(1)(g), or 300-A of the Constitution. The explanation to Section 5(8)(f) is clarificatory in nature and does not enlarge the scope of the original provision. Allottees have the right to trigger insolvency proceedings under Section 7 and to be represented on the Committee of Creditors through authorized representatives. The Code and RERA operate in complementary spheres with concurrent remedies available to allottees.
On this section: Referenced for principle that procedural provisions without consequences are directory, not mandatory.
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International Seaport Dredging Pvt. LTD vs Kamarajar Port Limited
Court's Decision & Legal Precedent
Statutory bodies and government corporations are not entitled to differential treatment in arbitration proceedings compared to private entities. The Arbitration Act is a self-contained code that mandates equal treatment of all parties under Section 18. When considering applications for stay of arbitration awards for payment of money, courts must apply principles of Order XLI Rule 5 of CPC as guidance, but the Arbitration Act provisions take precedence. The status of a party as a statutory undertaking or its perceived reliability cannot be basis for modifying conditions of stay. Instead, courts must require deposit of a substantial portion of the decretal amount (here, 75%) as condition for stay, regardless of the party's nature or status.
On this section: Challenge to arbitral award - respondent challenged award under this section and moved for stay of execution
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Dani Wooltex Corporation vs Sheil Properties Private Limited
Court's Decision & Legal Precedent
The power under clause (c) of subsection (2) of Section 32 of the Arbitration and Conciliation Act, 1996, can be exercised only when the Arbitral Tribunal records its satisfaction based on material on record that the continuation of proceedings has become unnecessary or impossible. Abandonment of a claim can be a ground to invoke this power, but abandonment cannot be readily inferred. Abandonment can be express or implied, but implied abandonment requires admitted or proved facts that are so clinching and convincing that the only inference which can be drawn is of abandonment. Mere failure of a claimant to request the Arbitral Tribunal to fix a date for hearing, per se, is no ground to conclude that the proceedings have become unnecessary or that the claim has been abandoned. It is the Arbitral Tribunal's duty to fix meetings and hearing dates, and it cannot abdicate this duty by requiring parties to request such dates. The Arbitral Tribunal cannot exercise its power under Section 32(2)(c) casually or without proper factual foundation, as doing so would defeat the very object of the Arbitration Act.
On this section: Tribunal's power to set aside awards; referenced in context of mandate termination
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Srei Infrastructure Finance Limited vs Tuff Drilling Private Limited
Court's Decision & Legal Precedent
An arbitral tribunal which has terminated proceedings under Section 25(a) of the Arbitration and Conciliation Act, 1996 due to non-filing of claim by the claimant retains jurisdiction to consider an application for recall of the order terminating the proceedings if the claimant shows sufficient cause. The tribunal does not become functus officio after passing an order under Section 25(a). The phrase 'where without showing sufficient cause' in Section 25(a) contemplates that sufficient cause can be shown either before or after the termination order is passed. If sufficient cause is shown, the arbitral tribunal can accept the statement of claim and permit the claimant to file the claim even after the time fixed under Section 23(1) has expired. The principles underlying Order 9 Rule 13 of the Civil Procedure Code, 1908 can be invoked by the arbitral tribunal to recall orders passed under Section 25(a) on sufficient cause being shown. The non-use of the phrase 'the mandate of the arbitral tribunal shall terminate' in Section 25(a), as opposed to its use in Section 32(3), indicates that the legislature intended that if the claimant shows sufficient cause, the proceedings can be re-commenced.
On this section: Application for setting aside arbitral award; Court held that remedy under Section 34 may not be available against Section 25(a) orders unless treated as awards
The holding above is the ratio decidendi as extracted from the judgment by eCourts India, reproduced unaltered — it is a rendering of the court's reasoning, not a substitute for its words. Read the order itself before relying on it.
Judgments citing this section
These may be obiter dicta or a precedent, for you to study. These are the judgments where this section is quoted.
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… Construction of a contract is a matter strictly within the jurisdiction of the arbitrator, and so long as the arbitrator construes it on a reasonable interpretation and his construction denotes a possible view, there is nothing for the challenge court to interfere with under Section 34 of the Arbitration and Conciliation Act, 1996 ("Act"). 6. There is no denial of the proposition of law laid down by the Supreme Court or our court in the cases cited by learned Counsel for the Petitioner. Prem Nath Motors Limited's case (supra) basically considers the effect of Section 230 of the Contract Act. …
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… After adding 100% solatium and interest, an additional amount of Rs. 2,21,11,562/- was found to be payable. - Against the Commissioner's award, the appellant, Madhya Pradesh Road Development Corporation, preferred objections before the District Court under Section 34(3) of the Arbitration and Conciliation Act, 1996<sup>5</sup> [.]( page-6-0) One of the contentions raised was that the compensation should not have been awarded by solely relying upon the Collector's Guidelines, as the land was undeveloped. - The objections were dismissed by the District Judge. It was observed that …
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… After adding 100% solatium and interest, an additional amount of Rs. 2,21,11,562/- was found to be payable. - Against the Commissioner's award, the appellant, Madhya Pradesh Road Development Corporation, preferred objections before the District Court under Section 34(3) of the Arbitration and Conciliation Act, 1996<sup>5</sup> [.]( page-6-0) One of the contentions raised was that the compensation should not have been awarded by solely relying upon the Collector's Guidelines, as the land was undeveloped. - The objections were dismissed by the District Judge. It was observed that …
Questions about Section 34
What have the courts held on Section 34 of the Arbitration and Conciliation Act?
Gayatri Balasamy v. ISG Novasoft Technologies Ltd. (30 Apr 2025) is the leading judgment on this section among those set out below: Courts have a limited power to modify arbitral awards under section 34; Another 15 judgments on this section are set out below, all of them from the Supreme Court. They run from 2002 to 2025.
How do I find court cases under Section 34 of the Arbitration and Conciliation Act?
In judgments and charge sheets this section is written several ways, and each form finds a different set of orders. These search the full text of every order eCourtsIndia holds, best matches first: Arbitration Act 34, section 34 Arbitration Act, section 34 of the Arbitration and Conciliation Act. People searching for it also type arbitration act 34 3 and arbitration act 34 5. Each opens the full list of orders on eCourtsIndia, where it can be narrowed by court, year and outcome. 16 reported judgments on this section are set out on this page, beginning with Gayatri Balasamy v. ISG Novasoft Technologies Ltd. (30 Apr 2025).
What should I read with Section 34 of the Arbitration and Conciliation Act, and has it changed?
Its own text turns on section 33 (Correction and interpretation of award; additional award), section 75 (Confidentiality), section 81 (Admissibility of evidence in other proceedings), so none of them can safely be read on its own. 8 other provisions in this corpus refer back to it.
When did Section 34 of the Arbitration and Conciliation Act come into force?
Section 34 of the Arbitration and Conciliation Act, commonly called setting aside arbitral award, and cited as Arbitration Act 34, came into force on 22 Aug 1996, having been enacted on 16 Aug 1996. It is in force as at the date shown on this page.
Other sections of this Act
- 8. Power to refer parties to arbitration where there is an arbitration agreement1029 words
- 11. Appointment of arbitrators1027 words
- 2. Definitions732 words
- 29A. Time limit for arbitral award635 words
- 57. Conditions for enforcement of foreign awards519 words
- 48. Conditions for enforcement of foreign awards493 words
Source and method. Compiled from the enactments of Parliament and of the State legislatures as published on India Code, and republished together with commentary and other original matter under section 52(1)(q)(ii) of the Copyright Act, 1957. Structured, cross-referenced and maintained by eCourtsIndia. Text as in force on 15 Oct 2026. This page is not a substitute for legal advice.