A Much Needed Clarification

It is widely assumed across India that courts have the powers to amend arbitration awards passed by arbitration tribunals.

- Dr P. Madhava Rao

These arguments and speculations arose in response to the decision of a five-member bench of India's Supreme Court on 30 April 2025. However, courts at the state level and apex level have been unequivocally stating that the arbitration and conciliation act envisages non-intervention of courts either into arbitration processes or into the arbitration award. Numerous judgments of the apex court have clarified that the court should not substantially modify the arbitrator's award. Despite this established norm, the Supreme Court had to constitute a five-judges bench under the leadership of the Chief Justice of India to put an end to the argument of the courts' inherent powers to modify an arbitration award.

A plain reading of opinions, arguments, and speculations reveals that the speculators have either unread or misread the judgment of the Supreme Court of India. A closer and clearer reading of the judgment reveals, without giving any scope to read between the lines, that they are addressing the question – Are Indian courts jurisdictionally empowered to modify an arbitral award? If so, to what extent due to the controversy which arises because the Arbitration and Conciliation Act, 1996, does not expressly empower courts to modify or vary an arbitral award? Section 34 of the 1996 Act only confers upon courts the power to set aside an award.