Appellate Court cannot re-appreciate evidence or substitute findings of Arbitral Tribunal in Section 37 proceedings.

The dispute arose from a 2008 work order for the construction of a Guest House for Academic Staff

Due to a lack of funds, the University failed to clear bills, leading the respondent to stop work and submit final bills

A dispute emerged over a balance sum of ₹2,26,617/- after the respondent accepted a part-payment under protest

Following a Section 11(6) application, a sole arbitrator was appointed on 15.05.2019, who passed an award in favor of the respondent on 31.12.2021

The University challenged the award under Section 34 of the Arbitration and Conciliation Act, 1996 ("the Act"), which the Commercial Court, Jodhpur, dismissed on 06.11.2024

The University then filed this appeal under Section 37 of the Act.

1. Whether the claims raised by the respondent were barred by the law of limitation.

2. Whether the Arbitral Tribunal exceeded its jurisdiction by misinterpreting Clause 6 of the agreement regarding re-measurements.

3. Whether the High Court, in an appeal under Section 37, can re-appreciate evidence or substitute its view for that of the Arbitrator.

The Court applied the restrictive scope of judicial interference under Section 34 and Section 37 of the Arbitration and Conciliation Act, 1996, emphasizing that an award can only be set aside if it is vitiated by patent illegality, conflict with public policy, or a fundamental error of jurisdiction

It relied on the principle that the Arbitrator is the sole judge of the quality and quantity of evidence and that contractual interpretation falls within the Arbitrator's domain

Regarding limitation, the Court followed the principle that for running accounts, limitation starts from the date of the final rejection of a claim or the last payment

The Court distinguished BSNL v. Nortel Networks India Pvt. Ltd., noting it applies only where claims are "ex facie" or "hopelessly" time-barred

The Court observed that its jurisdiction under Section 37 is even narrower than the limited scope under Section 34

It rejected the appellant's argument on limitation, agreeing with the Arbitrator’s finding that because the account was a "running account" and final rejection occurred in late 2012, the 2015 invocation was within time

On the interpretation of Clause 6, the Court held that even if an alternative interpretation were possible, the Arbitrator’s view was a "plausible" one and did not constitute patent illegality

The Court found that the Commercial Court had not "mechanically" dismissed the Section 34 petition but had properly applied the standards of minimal judicial interference

The Court concluded that the appellants were essentially asking for a re-appreciation of evidence regarding "idle machinery" and "project abandonment," which is impermissible under Section 37

The Court held that the findings on limitation and contractual interpretation were well-reasoned and based on material evidence

It reaffirmed that a Section 37 court cannot sit as a court of appeal to reassess factual findings unless there is manifest perversity, which was not established in this case

All pending applications were disposed of accordingly