Supreme Court Ruling: New Grounds to Modify Arbitral Awards

In a crucial judgment, India's Supreme Court has granted courts the limited power to modify arbitral awards under the Arbitration and Conciliation Act, 1996. The decision allows modifications for clerical errors or post-award interest, impacting commercial dispute resolutions. A dissenting opinion argued courts shouldn't alter such awards.

In a landmark decision, the Supreme Court has empowered Indian courts to modify arbitral awards under certain circumstances. Delivered with a 4:1 majority, the ruling clarifies that changes can be made to correct clerical errors and post-award interest stipulations in arbitral decisions.

The decision invokes Article 142 of the Constitution, permitting the Supreme Court to act in pursuit of 'complete justice,' which in this case includes adjusting awards when errors are apparent. The adjudication has significant implications for arbitration in commercial disputes on both domestic and international fronts.

The judgement sparked debate, as Justice K V Viswanathan dissented, insisting courts lack the authority to alter arbitral awards. Defense was led by key legal voices including Solicitor General Tushar Mehta, and the outcome is expected to impact future cases following the detailed judgement awaited.

(With inputs from agencies.)