Limited judicial review of arbitral awards bars reappreciation of evidence and substitution of contractual interpretation.

Under the Arbitration and Conciliation Act, 1996, judicial review of an arbitral award remains confined to the limited grounds under Sections 34 and 37, and a court cannot reappreciate evidence or replace a possible contractual interpretation adopted by the tribunal. Applying that standard, the tribunal's findings on the validity of the termination notice, defects in the civil structure, computation of Termination Payment and Adjusted Equity, and the rulings on waiver and interest were held to be within permissible interpretation and evidence-based findings. The arbitral award was therefore restored in substance, and the Division Bench judgment was set aside for exceeding the narrow supervisory limits.

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Issues: (i) whether the High Court could interfere with the arbitral award under Section 37 of the Arbitration and Conciliation Act, 1996 on the validity of the termination notice and the alleged defects in the civil structure; (ii) whether the High Court was right in setting aside the Tribunal's computation of Termination Payment by rejecting the amount treated as Equity for calculating Adjusted Equity; (iii) whether the Tribunal's findings on waiver, interest, and related reliefs called for interference.

Issue (i): Whether the High Court could interfere with the arbitral award under Section 37 of the Arbitration and Conciliation Act, 1996 on the validity of the termination notice and the alleged defects in the civil structure.

Analysis: The governing standard under Sections 34 and 37 is confined to the limited grounds recognised by the Arbitration and Conciliation Act, 1996. The court cannot reassess evidence or substitute its own view merely because another interpretation of the contract is possible. The Tribunal had returned findings of fact on the existence of defects, the failure to cure them within the contractual period, and the effect of the CMRS certificate. Those findings were based on evidence and a permissible construction of the concession terms. The High Court's approach amounted to reappreciation of evidence and an impermissible appellate review.

Conclusion: The High Court was not justified in setting aside the Tribunal's finding that the termination notice was valid.

Issue (ii): Whether the High Court was right in setting aside the Tribunal's computation of Termination Payment by rejecting the amount treated as Equity for calculating Adjusted Equity.

Analysis: The Tribunal construed the contractual definition of Equity and held that the promoter-funded amount used for the project could be included for computing Adjusted Equity. That interpretation was a possible and reasonable one on the contract language. The High Court's contrary view was based on a different reading of the evidence and the board resolution converting share application money into subordinated debt. Such substitution of view is barred where the Tribunal has adopted one of the possible contractual constructions. No patent illegality or perversity was shown.

Conclusion: The High Court was not right in disturbing the Tribunal's computation of Adjusted Equity and Termination Payment.

Issue (iii): Whether the Tribunal's findings on waiver, interest, and related reliefs called for interference.

Analysis: The Tribunal rejected waiver on the footing that the concessionaire's participation in meetings and continued operations were without prejudice. The interest award was in accordance with the contractual terms. No legal error warranting interference was shown in those findings, and the question of specific performance did not survive for adjudication before the Court.

Conclusion: No interference was warranted with the Tribunal's findings on waiver or interest.

Final Conclusion: The award of the arbitral tribunal was restored in substance, and the judgment of the Division Bench was set aside for having exceeded the narrow supervisory limits governing judicial review of arbitral awards.

Ratio Decidendi: Under the Arbitration and Conciliation Act, 1996, an arbitral award can be set aside only on the statutorily limited grounds, and a court cannot interfere by reappreciating evidence or replacing a possible contractual interpretation adopted by the tribunal with its own view.

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