M/S. DIAMOND PUBLICITIES vs THE UNION OF INDIA

IN THE HIGH COURT OF KARNATAKA AT BENGALURU

TH
DATED THIS THE 30 DAY OF OCTOBER, 2026

PRESENT


THE HON'BLE MRS. JUSTICE ANU SIVARAMAN

AND

THE HON'BLE MR. JUSTICE T.P.VIVEKANANDA


MISCELLANEOUS FIRST APPEAL NO.4725 OF 2016 (AA)


BETWEEN:

1. M/S. DIAMOND PUBLICITIES
NO.27, PRIMROSE ROAD
BENGALURU-560 025
REPT. BY PROP: P.B.ABDUR RAHMAN

2. SHRI P. B. ABDUR RAHMAN
S/O LATE P.S.M.BUKHARI
AGED ABOUT 38 YEARS
PROPRIETOR
M/S. DIAMOND PUBLICITIES
NO.27, PRIMROSE ROAD
BENGALURU -560 025
…APPELLANTS








Digitally
signed by
PAVITHRA N
Location:
High Court
of Karnataka



(BY SRI. ASHOK HARANAHALLI, SR. COUNSEL A/W
SRI. YESHU BABA R. MISHRA, ADVOCATE)

AND:

1. THE UNION OF INDIA
SOUTH-WESTERN RAILWAYS
BENGALURU DIVISION
REP. BY ITS SENIOR DIVISIONAL
COMMISSIONER
BENGALURU -560 023

2

2. THE SENIOR DIVISIONAL
COMMERCIAL MANAGER
SOUTH-WESTERN RAILWAYS
BENGALURU -560 023

3. SHRI A. S. RAO
ARBITRATOR
CHIEF FREIGHT TRANSPORTATION MANAGER
SOUTH-WESTERN RAILWAY
ZONAL HEADQUARTERS OFFICE
TRANSPORTATION BRANCH
ND
2 FLOOR, EAST BLOCK
GADAG ROAD, HUBLI-580 020
(SOLE ARIBITRATOR)
…RESPONDENTS
(BY SRI. ABHINAY Y. T., ADVOCATE)

THIS MFA IS FILED UNDER SECTION 37(1)(b) OF THE
ARBITRATION AND CONCILIATION ACT, 1996, AGAINST THE
JUDGMENT AND AWARD DATED 13.04.2016 PASSED IN
TH
A.S.NO.12/13 ON THE FILE OF THE 6 ADDITIONAL CITY CIVIL &
SESSIONS JUDGE, BENGALURU CITY, DISMISSING THE SUIT
FILED UNDER SECTION 34 OF THE ARBITRATION AND
CONCILIATION ACT.

THIS MISCELLANEOUS FIRST APPEAL HAVING BEEN HEARD
AND RESERVED FOR JUDGMENT ON 15.09.2026 AND COMING
ON FOR PRONOUNCEMENT OF JUDGMENT THIS DAY, ANU
SIVARAMAN J., PRONOUNCED THE FOLLOWING:

CORAM: HON'BLE MRS. JUSTICE ANU SIVARAMAN
and
HON'BLE MR. JUSTICE T.P.VIVEKANANDA

3

CAV JUDGMENT

(PER: HON'BLE MRS. JUSTICE ANU SIVARAMAN)

This Miscellaneous First Appeal is filed challenging the
judgment and decree dated 13.04.2016 passed by the VI
Additional City Civil and Sessions Judge, Bengaluru City
(CCH-11) ('Civil Court' for short) in A.S.No.12/2013,
whereby the suit filed by the plaintiffs under Section 34 of
the Arbitration and Conciliation Act, 1996 was dismissed and
the arbitral award dated 19.01.2013 was upheld.


2. We have heard Shri. Ashok Haranahalli, learned
senior counsel as instructed by Shri. Yeshu Baba R Mishra,
learned counsel appearing for the appellants and Shri.
Abhinay Y.T, learned counsel appearing for the respondents.

3. It is submitted by the learned senior counsel
appearing for the appellants that the South Western
Railway, Bengaluru Division, invited tenders by notification
dated 30.04.2007 for allotment of spaces for display of
advertisement hoardings and glow signs for a period of five
years. Appellant No.1, a proprietary concern represented by

4

appellant No.2, submitted the highest bid, which was
accepted by letter dated 08.08.2007. The appellants
accepted the offer and furnished the security deposit of
Rs.69,19,453/- and performance guarantee of
Rs.69,19,453/-, apart from paying the licence fee for the
first year. An agreement was thereafter executed between
the parties on 10.01.2008. The contractual period was from
01.12.2007 to 30.11.2012.


4. During the subsistence of the contract, disputes
arose between the parties concerning the availability and
use of the allotted advertising spaces and the performance
of their respective contractual obligations. By letter dated
28.10.2009, the appellants invoked the termination clause
and brought the contract to an end with effect from
01.12.2009. The Railways asserted its entitlement to forfeit
the security deposit and encash the performance guarantee
on account of premature termination. The appellants
disputed such entitlement and sought refund of the security
deposit, release of the performance guarantee and payment
of compensation. The dispute was referred to the sole

5

Arbitrator appointed pursuant to the order of this Court
dated 22.06.2010. By award dated 19.01.2013, the
Arbitrator upheld the forfeiture of the security deposit and
the encashment of the performance guarantee and rejected
the claim for compensation. The appellants challenged the
award in A.S.No.12/2013 under Section 34 of the Arbitration
and Conciliation Act.


5. The Civil Court held that interference with an
arbitral award under Section 34 of the Arbitration and
Conciliation Act is confined to the grounds specified therein
and that the Court cannot reappreciate the evidence or
substitute its own interpretation of the contract merely
because another view is possible. The objections concerning
the venue and the Arbitrator’s expressed difficulty in
devoting sufficient time to the proceedings were rejected,
noticing that the venue had been shifted from Hubli to
Bengaluru at the appellants’ request and that neither
prejudice nor unwillingness to adjudicate was established.
The contention regarding denial of opportunity was also
rejected, since the parties had submitted affidavits, filed and

6

answered interrogatories and were afforded sufficient
opportunity to present their respective cases.

6. On the merits, the Civil Court held that the
Arbitrator’s interpretation of the expression “full period” as
referring to the entire five-year contractual term was a
plausible construction of the agreement. Since the
appellants had terminated the contract before expiry of that
period, the finding upholding forfeiture of the security
deposit and encashment of the performance guarantee was
sustained. As regards damages, it was held that, despite the
absence of a separate issue, the Arbitrator had considered
the reasons advanced for termination, held that those
reasons did not establish responsibility on the part of the
Railways and treated the allegation of fraud as an
afterthought. Relying also on Clause IX(1), which excluded
damages or compensation upon termination, the Civil Court
rejected the distinction urged between damages for breach
and compensation for termination. Finding no perversity,
irrationality or ground for interference under Section 34 of

7

the Arbitration and Conciliation Act, the suit was dismissed,
leaving the parties to bear their respective costs.
7. The learned senior counsel appearing for the
appellants contends that the award was rendered without
affording a reasonable opportunity to lead evidence and
address arguments. It is submitted that the Arbitrator failed
to conduct an effective hearing, frame appropriate issues or
consider the documents and interrogatories placed before
him and that the award rests on guesswork and surmises
without adequate reasons. Reliance is placed on the
Arbitrator’s written request to be relieved owing to difficulty
in devoting sufficient time to the proceedings. It is further
contended that the conduct of the proceedings in the
chambers of the respondent authorities affected the
independence and fairness of the adjudication. It is
submitted that the Civil Court rejected these objections
without properly examining the arbitral record and the
resulting prejudice.
8. It is further contended that the Arbitrator
erroneously confined the adjudication to the two questions

8

concerning refund of the security deposit and release of the
performance guarantee, as formulated by the Railways. The
appointment made by this Court required resolution of the
disputes between the parties and the scope of adjudication
could not be restricted by a unilateral reference issued by
the respondent authorities. The failure to frame and
determine the questions concerning the alleged breach by
the Railways and the consequential claim for damages is
therefore stated to vitiate the award.
9. It is contended that the Railways failed to make
available the advertising spaces contemplated under the
tender and the agreement and arbitrarily restricted the
erection of further hoardings. The appellants allege
suppression of material facts concerning the proposed
development of portions of the allotted area by the Railway
Land Development Authority and occupation of other
portions for Metro works. It is also submitted that space
covered by their contract was allotted to a competing
advertising agency and that the Railways failed to address
interference by third parties and the municipal authorities.

9

These acts and omissions are stated to have prevented
effective utilisation of the allotted spaces, caused substantial
financial loss and compelled premature termination.
10. It is further submitted that Clause IX(1)
permitted either party to terminate the agreement by giving
not less than thirty days’ notice and that exercise of this
contractual right could not, by itself, warrant forfeiture of
the security deposit and encashment of the performance
guarantee. The provisions governing those securities ought
to have been read harmoniously with the termination clause,
construing “satisfactory completion” as performance up to
the date of valid termination rather than invariably requiring
completion of the entire five-year term. It is contended that
the interpretation accepted by the Civil Court renders the
right of premature termination ineffective.
11. It is further submitted that the claim for damages
arose from the antecedent breaches allegedly committed by
the Railways and was distinct from compensation merely on
account of termination. The exclusion under Clause IX(1)
could not absolve the Railways of liability for its own

10

breaches or the alleged suppression and misrepresentation
that induced the appellants to submit a higher bid. The
failure to consider these contentions and the supporting
correspondence is stated to render the award perverse and
contrary to public policy. It is further submitted that the
bank guarantees were conditional and their invocation was
required to conform to the terms thereof. It is contended
that premature termination did not automatically entail
forfeiture of the security deposit and encashment of the
performance guarantee without establishing breach
attributable to the appellants and the loss occasioned
thereby. It is contended that forfeiture in the absence of
such loss would result in unjust enrichment of the Railways.
12. It is further contended that any ambiguity in the
expression “full period” ought to be construed against the
Railways, which drafted the agreement, by applying the rule
of contra proferentem . It is contended that construing that
expression invariably as five years would expose the
appellants to forfeiture even where the Railways itself
exercised the contractual right of premature termination. It

11

is also contended that the non-availability of the allotted
sites for Metro works, coupled with the restriction against
seeking additional advertising locations, frustrated the
performance of the contract. Reliance is placed on the
replies furnished by BMRCL under the Right to Information
Act to contend that the affected land could not be used for
display of advertisement hoardings, notwithstanding which
the Railways continued to demand licence fees.
13. The learned senior counsel appearing for the
appellants places reliance on the following decisions:-
• Bhadra International (India) Pvt. Ltd. & Ors.,
v. Airports Authority of India reported in 2026
SCC OnLine SC 7;
• Central Organisation for Railway
Electrification v. ECI-SPIC-SMO-MCML (JV)
reported in (2025) 4 SCC 641;
• Rahee-GPT (JV) & Ors., v. Union of India &
Ors., reported in 2026 SCC OnLine Cal 1699;
• Fateh Chand v. Balkishan Dass reported in AIR
1963 SC 1405;
• Union of India v. Rampur Distillery and
Chemical Co. Ltd reported in (1973) 1 SCC 649;

12

• Maula Bux v. Union of India reported in (1969)
2 SCC 554, and
• Kailash Nath Associates v. Delhi Development
Authority & Anr., reported in (2015) 4 SCC 136.
14. The learned senior counsel appearing for the
respondents contends that the appellants voluntarily
terminated the agreement before completion of the
stipulated five-year period and thereby attracted the
contractual consequences of forfeiture of the security
deposit and encashment of the performance guarantee. It is
contended that the right to terminate the agreement by
giving thirty days’ notice did not absolve the appellants of
the obligation to perform the contract for its full period or
the consequences stipulated for premature termination.
Having accepted the contractual terms, the appellants could
not question their operation on the ground of inequality. It
was further contended that the agreement expressly
excluded any claim for damages or compensation.
15. The allegations concerning non-availability of
advertising spaces and breach of the agreement is denied. It
is contended that permission to erect hoardings was subject

13

to approval by the Railway Administration and that the
restriction on additional hoardings was consistent with the
area covered by the tender. No communication had been
issued requiring removal of the appellants’ hoardings for
development by the Railway Land Development Authority.
The Metro soil-testing work was undertaken away from the
hoarding locations and no direction had been issued for
removal of any hoarding on that account. The allotment to
M/s. Adcom Advertising was stated to have been made after
obtaining the appellants’ no-objection. Compliance with the
applicable municipal bye-laws was stated to be the
appellants’ responsibility under the tender conditions.
16. With regard to the arbitral proceedings, it is
contended that adequate opportunity had been afforded to
both parties and that the appellants, having participated in
the proceedings, could not subsequently allege denial of a
fair hearing. The venue had not prejudiced their case and
the Arbitrator’s earlier request to be relieved did not
establish that the adjudication was unfair or undertaken
without application of mind. It is also contended that the

14

Arbitrator was bound by the terms of reference and that this
Court’s order leaving the parties’ contentions open did not
authorise adjudication beyond that reference.
17. We have considered the contentions advanced.
We have also perused the pleadings and the materials on
record. We notice that the contention of the appellants was
that respondents No.1 and 2 - South Western Railways, had
called for sealed tenders for allotment of space for displaying
of advertising holdings/glow signs for a period of five years
by a Notification dated 30.04.2007. The claimant's bid was
accepted by letter dated 08.08.2007. A security deposit of
Rs.69,19,453/- and performance guarantee from a
Nationalized Bank for Rs.69,19,453/- was also executed
along with license fee of Rs.2,27,77,779/-. It is stated that
an agreement was entered into on 10.01.2008 which
provided an arbitration clause. The appellants invoked the
arbitration clause. The claims raised are as follows:-
"28. The details of the damages sought by the
claimant are detailed hereunder:-
I) Initially a sum of Rs.11,33,400/- was paid as
security Deposit by Pay order no.090084 dated
22.10.2007. Later this amount was treated as part of

15

Security Deposit Bank Guarantee to be furnished for
Rs.69,19,453 and therefore, a Security Deposit Bank
Guarantee for the balance amount of Rs.57,86,053/- was
given on 27.3.2008.
II) Under the Agreement the two following Bank
Guarantees were given to the respondent-Railways
a) Security Deposit Bank Guarantee for
Rs.57,86,053/-bearing No.004GT01080870001
dated 27/03/2008.
b) Performance Bank Guarantee for
Rs.69,19,453/-bearing No.004GT02081710001
dated 19/06/2008.
III) The full Licencee fee was to be paid by
31.3.2009. A sum of Rs.1,08,71,285-00 was due in
respect thereof. Therefore, by consent, the Security
Deposit Bank Guarantee for Rs.57,86,053-00 and
Performance Bank Guarantee of Rs.69,19,453-00 were
encashed on 1.4.2009 and realized Rs.1,27,05,513-00
out of that and the excess/balance of Rs.18,34,228/-was
retained by respondent Railways as Security deposit.
Therefore Security Deposit (cash deposit) became
(11,33,400 + 18,34,228) = Rs.29,67,628 which was
lying in cash with the respondent Railways. It was
retained by the Railways as of part of Security Deposit
Bank Guarantee of Rs.69,19,453/- For the balance of
Rs.39,51,832/- a Security Deposit Bank Guarantee was
furnished on 19.5.2009.
The Performance Bank Guarantee was replaced by
new Bank Guarantee for Rs.69,19,453/- was furnished
on 19.5.2009.

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IV. Taking in to account the above facts which
indicate that the respondent Railways has enjoyed the
funds of the claimant, the interest is claimed for the
period during which it had the benefit of claimant's
funds.
Interest on
(a) Rs.11,33,400/- was lying with Railways from
22.10.2007 to 1.4.2009. Therefore, interest @ 18%
on Rs.11,33,400/- from 22.10.2007 to 1.4.2009 is
payable by the Railways, which works out to be
Rs.2,94,000/-
(b) Similarly, a sum of Rs.29,67,628 /- was lying
with Railways from 1.4.2009 to this day. Therefore,
interest @ 18% on Rs.29,67,628/- from 1.4.2009
to 31.8.2010 is payable by the Railways, which
works out to be Rs.7,56,623/-
(c) The Claimant has borrowed a sum of Rs
Rs.57,86,053/- for obtaining Bank Guarantee for
Rs.57,86,053/- from 27.3.2008 to 1.4.2009. An
interest of 13% was paid on it by claimant. The said
amount was kept in Fixed Deposit with the bank
which earned interest at 6% for claimant. The
difference of interest lost @7% by the Claimant
from 27.3.2008 to 1.4.2009 is liable to be paid by
the respondent Railways, which works out to be
Rs.4,08,353/-
(d) Similarly, on balance of Rs 39,51,832/- Security
Deposit Bank Guarantee from 19.5.2009 to
31.8.2010 interest @ 7% will be Rs.3,54,690/-

17

V) Similarly for the Other Performance Bank
Guarantee:
(i), interest @ 7% on Rs.69,19,453/- from
19.6.2008(date of furnishing the BG) till 1.4.2009
which will be Rs.3,76,873/-
(ii) Interest @ 7% as Rs.69,19,453/-from 19.5.2009
(date of furnishing the BG) to 31.8.2010 which will
be Rs.6,21,045/-

VI) Loss on account of materials being lost:-
Hoarding Material Cost of Hoarding Rs.2,00,000/-
Less: Scrap Value (15%) Rs. 30,000/-
Rs.1,70,000/-
Less for 2 years utilization Rs. 68,000/-
Loss on 1 unit for
the remaining 3 years Rs.1,02,000/-
Rs.1,02,000/- for. 57 Units is Rs.58,14,000/-
VII) Loss on account of not providing the sites:-
Loss on Krishna Flour Mill Junction 6 nos hoardings:-
Monthly display charges at Rs:2,85,000/-
Loss for 20 Months Rs.57,00,000/-
VIII) Other expenses incurred due to Railways
defaults:-
Legal Expenses for obtaining stay from Court
a) Group I locations against Corporation

18

b) Raman Case Rs.5,00,000/-
IX) Loss of profit @ 10% for 3rd 4th & 5th Year on
licence fee
Licence fee (Rs.)
3rd Year 2,74,28,012-
4th Year 3,01,17,813 -
5th Year 3,31,87,895
9,07,33,720
Rs.90,73,372/-
X) Loss due to delays by Railways in plan approval:-
Inside Bangalore City Railway Station plan approval should
have been given within 45 days of our application for plan
approval dated 29-01-2008. Thus our plan was approved
on 23-06-2008 and from their 45 days i.e., 07-08-2008.
Whereas the license fee is collected from 01-12-2007 to
07-08-2008. (251 days).
c) License fee for the 1st year is Rs.2,26,67,778/-for
58,054 sqft.

i) Inside 13,254 Sqft

ii) Outside 44,800 Sqft

Total 58,054 Sqft

d) Rate per Square feet is Rs. 390.46 /-x 13,254 Sqft is
Rs. 51,75,157/-för 1st year (365 days). Therefore for 251
days Rs.35,58,808/-
e) 18% interest per annum on Rs.35,58,808/- for the
period from 01-12-2007 to 31-08-2010 i.e., 1003 days is
Rs.17,60,265/- (Interest per day is Rs.1755/-)

19

f) Total amount including license fee and interest is
Rs.53,19,073/- . "
18. Statement of objections were placed on record by
the respondents specifically stating that the contract
specifically provided that the security deposit is in the nature
of security for satisfactory completion of the agreement and
that the contractor would be eligible for refund of the same
only on successful completion of the contract. The same is
the case with the performance guarantee as well. It was
contended that since the appellant admittedly did not
complete the contract and had terminated the contract at his
own instance, there was no merit in the contention for the
refund of the security deposit and the performance
guarantee or any claim for interest thereon. Further, it was
stated that there is absolutely no evidence on record for any
of the other claims raised by the appellants.
19. The learned Arbitrator considered the contentions
advanced and specifically found that the performance
guarantee as well as the security deposit were provided for
the satisfactory completion of the contract for the full period
and that there could be no claim unless the contract had

20

been completed, which was admittedly not so in the present
case. Further, the learned Arbitrator had also specifically
found that the reason quoted for the termination of contract
by the claimant are due to self-induced impossibility which
cannot be considered for repayment of the security deposit.
Further, it was found that with regard to the other claims
raised, there is no evidence on record and the claim is liable
to be dismissed.
20. Though, the learned senior counsel for the
appellants raised several contentions before us, no material
is placed on record either before the Section 34 Court or
even before this Court in support of the allegations made in
the appeal.
21. The scope of interference of this Court in an
appeal under Section 37 of the Arbitration Act has been
categorically laid down by the Apex Court MMTC Ltd. v.
Vedanta Ltd. reported in (2019) 4 SCC 163. The Apex
Court held as follows:-
"11. As far as Section 34 is concerned, the position
is well-settled by now that the Court does not sit in

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appeal over the arbitral award and may interfere on
merits on the limited ground provided under Section
34(2)(b)(ii) i.e. if the award is against the public
policy of India. As per the legal position clarified
through decisions of this Court prior to the
amendments to the 1996 Act in 2015, a violation of
Indian public policy, in turn, includes a violation of
the fundamental policy of Indian law, a violation of
the interest of India, conflict with justice or
morality, and the existence of patent illegality in the
arbitral award. Additionally, the concept of the
“fundamental policy of Indian law” would cover
compliance with statutes and judicial precedents,
adopting a judicial approach, compliance with the
principles of natural justice, and Wednesbury
reasonableness. Furthermore, “patent illegality”
itself has been held to mean contravention of the
substantive law of India, contravention of the 1996
Act, and contravention of the terms of the contract.

12. It is only if one of these conditions is met that
the Court may interfere with an arbitral award in
terms of Section 34(2)(b)(ii), but such interference
does not entail a review of the merits of the dispute,
and is limited to situations where the findings of the
arbitrator are arbitrary, capricious or perverse, or
when the conscience of the Court is shocked, or
when the illegality is not trivial but goes to the root
of the matter. An arbitral award may not be
interfered with if the view taken by the arbitrator is
a possible view based on facts.

22

14. As far as interference with an order made
under Section 34, as per Section 37, is concerned, it
cannot be disputed that such interference under
Section 37 cannot travel beyond the restrictions laid
down under Section 34. In other words, the court
cannot undertake an independent assessment of the
merits of the award, and must only ascertain that
the exercise of power by the court under Section 34
has not exceeded the scope of the provision. Thus,
it is evident that in case an arbitral award has been
confirmed by the court under Section 34 and by the
court in an appeal under Section 37, this Court must
be extremely cautious and slow to disturb such
concurrent findings."
22. These principles were reaffirmed in Konkan
Railway Corpn. Ltd. v. Chenab Bridge Project reported
in (2023) 9 SCC 85 , wherein the Apex Court held that the
jurisdiction of the court under Section 37 of the Arbitration
Act is akin to its jurisdiction under Section 34 of the
Arbitration Act, and that the scope of interference in an
appeal under Section 37 of the Arbitration Act, while
examining an order setting aside or refusing to set aside an
award, is restricted to and subject to the same grounds as a
challenge under Section 34 the Arbitration Act. It was also
held that the jurisdiction under Sections 34 and 37 the

23

Arbitration Act is not in the nature of normal appellate
jurisdiction.
23. The narrow jurisdiction under Section 37 of the
Arbitration Act was also laid down in UHL Power Company
Ltd. v. State of Himachal Pradesh reported in (2022) 4
SCC 116 . This line of reasoning was further affirmed in
Larsen Air Conditioning & Refrigeration Co. v. Union of
India reported in (2023) 15 SCC 472 , wherein the Apex
Court held that the jurisdiction of the court under Section 34
of the Arbitration Act is limited and extremely circumscribed,
permitting interference only on the ground of patent
illegality which goes to the root of the matter and is not of a
trivial nature.
24. The Apex Court in Punjab State Civil Suppliers
Corporation Limited and Another v. M/s Sanman Rice
Mills and Others reported in 2024 INSC 742, held that an
Arbitral Award is not liable to be interfered with only on the
ground that the award is illegal or is erroneous in law, that
too upon reappraisal of the evidence adduced before the
arbitral trial. Even an award which may not be reasonable or

24

is non-speaking to some extent cannot ordinarily be
interfered with by the Courts. It is also well settled that even
if two views are possible, there is no scope for the Court to
reappraise the evidence and to take the different view other
than what has been taken by the arbitrator.
25. Further, in Somdatt Builders-NCC-NEC(JV) v.
National Highways Authority of India and Ors. reported
in 2025 INSC 113 , the Apex Court after considering the
case law on the point, held as under:-
"42. As already discussed above, the Arbitral
Tribunal had interpreted Clause 51 in a reasonable
manner based on the evidence on record. This
interpretation was affirmed by the learned Single Judge
exercising jurisdiction under Section 34 of the 1996 Act.
Therefore, Division Bench of the High Court was not at all
justified in setting aside the arbitral award exercising
extremely limited jurisdiction under Section 37 of the
1996 Act by merely using expressions like ‘opposed to the
public policy of India’, ‘patent illegality’ and ‘shocking the
conscience of the court’. As reiterated by this Court in
Reliance Infrastructure Ltd. (supra), it is necessary to
remind the courts that a great deal of restraint is required
to be shown while examining the validity of an arbitral
award when such an award has been upheld, wholly or
substantially, under Section 34 of the 1996 Act. Frequent

25

interference with arbitral awards would defeat the very
purpose of the 1996 Act."

26. In the factual situation available in the instant
case, we find that no interference is warranted in the matter
since no grounds have been made for interference referable
to Section 37 of the Arbitration and Conciliation Act. The
appeal fails and the same is accordingly dismissed.
All pending interlocutory applications shall stand
disposed of.

Sd/-
(ANU SIVARAMAN)
JUDGE


Sd/-
(T.P.VIVEKANANDA)
JUDGE


PN