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Introduction
The arbitration landscape in India has often been critiqued for the extent of judicial intervention in the arbitral process. Despite reforms such as the 2015 amendments to the Arbitration and Conciliation Act, 1996 (“Arbitration Act”) designed to limit challenges to arbitral awards, instances of judicial intervention persist. These include the Supreme Court’s exercise of curative jurisdiction to set aside awards[1] and certain anti-arbitration injunctions granted by High Courts[2], which raise questions regarding India’s progress towards becoming a truly arbitration-friendly jurisdiction.
However, recent decisions from the Supreme Court and High Courts signal a shift towards greater judicial restraint at key stages including referral to arbitration, conduct of proceedings, and post-award scrutiny. This article examines cases from the past year in which courts have, first, directed disputes to arbitration rather than retaining jurisdiction; secondly, recognised arbitral tribunals’ authority to decide procedural/jurisdictional issues; and finally, limited post-award judicial review to preserve the finality of arbitral awards.
The Referral Stage
An arbitration-friendly jurisdiction is characterised by judicial deference to parties’ agreements to arbitrate. Recent judicial trends in India reflect a growing recognition of this principle, supporting party autonomy.
In K. Mangayarkarasi v. N.J. Sundaresan[3], the Supreme Court clarified that Section 8[4] of the Arbitration Act requires disputes be referred to arbitration where a prima facie valid arbitration agreement exists. In this case, trademark disputes arising from assignment deeds were held to be arbitrable where the rights asserted were contractual and in personam. The Court also reiterated that allegations of fraud cannot be routinely invoked to bypass arbitration unless they are serious and have public law implications.
Similarly, Bombay High Court’s decision in Bholashankar Ramsuresh Dubey v. Dinesh Narayan[5], set aside a district court’s judgement wrongly withholding a partnership dispute from arbitration on allegations of fraud. It was held that disputes relating to the internal affairs of a partnership remain arbitrable and that legal representatives are bound by arbitration agreements by virtue of Section 40 of the Arbitration Act.[6] The Court ruled that as long as the fraud revolves around civil aspects of the dispute, it is arbitrable.
In Offshore Infrastructure Ltd. v. Bhopal Petroleum Corp. Ltd.,[7] the Supreme Court further strengthened the pro-arbitration stance by holding that the ineligibility of a named arbitrator does not invalidate the arbitration agreement itself and that a defective appointment mechanism does not override the parties’ fundamental agreement to arbitrate.
During Arbitral Proceedings
Judicial support and deference for arbitral autonomy have also been reflected in the approach adopted by Indian courts during the pendency of arbitral proceedings.
In ASF Buildtech Pvt. Ltd. v. Shapoorji Pallonji & Co.[8], the Supreme Court affirmed the power of arbitral tribunals to implead non-signatories under the Group of Companies doctrine. The Court rejected the contention that such determinations must be made at the referral stage by courts, holding instead that the question of a non-signatory being bound by an arbitration agreement involves complex, fact-intensive inquiries best left to an arbitral tribunal in terms of Section 16 of the Arbitration Act[9], supporting the principle of Kompetenz–Kompetenz.
A similar reluctance to interfere in arbitral proceedings was seen in National Highway Infra Development Corp. Ltd. v. NSPR VKJ[10], where the Delhi High Court declined to terminate the mandate of an arbitrator based on unsubstantiated allegations of corruption and bias. The Court cautioned against the misuse of termination petitions as a tactical device to stall arbitral proceedings.
These decisions help underscore that, once the arbitral tribunal is constituted, it should be the primary forum for procedural and jurisdictional control of the dispute.
Post-Award Review
Recent precedent also demonstrates judicial restraint at the post-award stage and an acknowledgement of the importance of finality of arbitral awards.
The Supreme Court in Somdatt Builders v. National Highways Authority of India[11] set aside a judgment of the Delhi High Court that had re-interpreted contractual clauses in an appeal under Section 37 of the Arbitration Act.[12] The Court reiterated that if an arbitral tribunal takes a plausible view of a contract, courts should refrain from interfering with it under Section 34 of the Arbitration Act, as this would defeat the purpose of the Act.[13]
Similarly, in Ramesh Kumar Jain v. Bharat Aluminium Company (BALCO)[14], the Supreme Court emphasised the limited scope of judicial intervention under Section 37 of the Arbitration Act, holding that the Chhattisgarh High Court had exceeded its jurisdiction by reassessing evidence and substituting its own factual conclusions for those reached by the arbitral tribunal. It was clarified that interference with an award under grounds of “patent illegality” must go beyond allegations of erroneous application of law or misappreciation of evidence. It was further recognised that where a contract is silent on compensation for additional work, an arbitrator may award reasonable compensation on the principle of quantum meruit to prevent unjust enrichment. The Supreme Court restored the arbitral award, holding that the High Court had applied a stricter standard of scrutiny than is contemplated under the Arbitration Act.
In Gayatri Balaswamy v. ISG Novasoft Technologies Ltd.[15], a Constitution Bench of the Supreme Court conclusively settled the controversy surrounding the power of courts to modify arbitral awards. The Court held that the power to set aside an award under Section 34 of the Arbitration Act includes a power to modify the award. However, it was also observed that such power to modify the award is limited to granting post-award interest, correction of any clerical or typographical errors, and severing those parts of the award that contravene Section 34 of the Arbitration Act. Further, the power to modify an award should not be exercised so as to result in rewriting the award or modifying it on merits.
In Popular Caterers v. Ameet Mehta & Ors.[16], the Supreme Court set aside a Bombay High Court order granting an unconditional stay on the execution of a money award, reiterating that such relief is exceptional under Section 36(3) of the Arbitration Act. Referring to its earlier judgment in Lifestyle Equities C.V. v. Amazon Technologies Inc.[17], the Court held that unconditional stays are justified only where awards are egregiously perverse, patently illegal, or tainted by fraud or corruption. Otherwise, requiring security for a stay was held to be consistent with the statutory scheme and arbitral finality.
Divergent Judicial Approaches
While the aforementioned judgments indicate positive trends towards judicial restraint, this does not mean that instances of judicial intervention are non-existent.
In Engineering Projects (India) Ltd v. MSA Global LLC[18], The Delhi High Court granted an anti-arbitration injunction restraining a Singapore-seated ICC arbitration on the grounds that it was “vexatious” and “oppressive”, thereby reasserting a supervisory role over a foreign-seated arbitration that was already subject to challenge before the arbitral tribunal, the ICC Court, and the supervisory court at the seat. Similarly, in Union of India v. V.K. Sood Engineer & Contractors[19], the Court undertook an extensive re-appreciation of contractual and evidentiary material, expanding the contours of “patent illegality” and public policy beyond the restrained intervention envisaged under the 2015 amendments. In the same vein, Bharat Heavy Electrical Limited v. Koneru Constructions[20] saw the Delhi High Court set aside an award after closely scrutinising the effect of a No Dues Certificate and reassessing the evidentiary foundation of the arbitrator’s conclusions. These approaches can be viewed as merits-oriented review undertaken under the guise of public policy and patent illegality.
Although Gayatri Balaswamy limits the power of courts to modify the award to limited circumstances, it has raised concerns that post-award proceedings may, in practice, assume a quasi-appellate character, thereby diluting the principle of finality.
Such instances underscore the need for arbitration jurisprudence reorient towards restraint, before greater changes in the Indian arbitration landscape may occur.
Conclusion
The recent precedents discussed above reflect a coherent and deliberate reorientation towards judicial restraint in arbitration matters. Indian courts appear increasingly aligned with well-established global principles of limiting referral courts to a threshold examination of the existence of an arbitration agreement, entrusting arbitral tribunals with jurisdictional and procedural autonomy, and confining post-award scrutiny to limited and exceptional parameters.
At the same time, recent jurisprudence also reflects some divergence in judicial approaches. Certain decisions have adopted a more expansive view of judicial oversight, particularly at the post-award stage, prompting debate on the appropriate limits of court intervention and the preservation of arbitral finality. These decisions indicate that while the broader pro-arbitration shift is evident, its application has not been entirely uniform.
If a restrained judicial approach continues to be consistently applied, it is likely to enhance both certainty and confidence in India’s arbitration framework. That said, change cannot be expected from courts alone, the sustained credibility of arbitration in India will also depend on the parallel evolution of arbitral institutions and the conduct of arbitral proceedings. Robust institutional practices, effective case management, and adherence by arbitrators to international best practices are also essential to ensuring that arbitration delivers efficient, fair, and commercially viable outcomes.
[1] Delhi Metro Rail Corporation Ltd. v. Delhi Airport Metro Express Pvt. Ltd [(2024) 6 SCC 357]
[2] Bina Modi v. Lalit Modi [(2021) 277 DLT 501 (DB)]; Balasore Alloys v. Medima LLC [2020 SCC OnLine Cal 1699]
[3] (2025) 8 SCC 299
[4] Section 8 states that if a dispute brought before a court is covered by a valid arbitration agreement, the court must refer the parties to arbitration when a party asks for it before submitting its first statement on the substance of the dispute.
[5] 2025 SCC OnLine Bom 1478
[6] As per Section 40, an arbitration agreement continues to be valid even after death of the party and can be enforced by or against the legal representatives of the deceased.
[7] 2025 SCC OnLine SC 2147
[8] (2025) 9 SCC 76
[9] Section 16 gives power to the arbitral tribunal to rule on its own jurisdiction, including ruling on any objections with respect to the existence or validity of the arbitration agreement.
[10] 2025 SCC OnLine 9022
[11] (2025) 6 SCC 757
[12] Section 37 limits appeal to only certain specific orders of courts pertaining to refusing to refer parties to arbitration, granting or refusing interim measures, or setting aside an arbitral award.
[13] Section 34 lays down the limited grounds under which an award can be set aside by courts such as incapacity of a party, arbitration agreement not being valid under law, subject-matter of dispute was not arbitrable, arbitral award is in conflict with the public policy of India, award is vitiated by patent illegality, etc.
[14] 2025 SCC OnLine SC 2857
[15] (2025) 7 SCC 1
[16] C.A. No. 14260-14262/2025
[17] 2025 SCC OnLine SC 2153
[18] 2025 SCC OnLine Del 5072
[19] 2025 SCC OnLine Del 4399
[20] O.M.P (COMM) 255/2020
