Arbitral award interference limited to perversity or clear error, with contract termination findings left undisturbed.

An arbitral award based on appreciation of evidence and a plausible interpretation of the contract is not liable to interference under Sections 34 and 37 of the Arbitration and Conciliation Act, 1996 unless it is perverse, contrary to the evidence, or otherwise attracts a recognised ground of challenge. The SC noted that the tribunal's finding of illegal termination was accepted below, that the award dealt with each claim on its merits, and that the counterclaim was rejected as a consequence of the termination finding. On that basis, the challenge to the award and the rejection of the counterclaim failed.

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Issues: Whether the arbitral award, as affirmed in proceedings under Sections 34 and 37 of the Arbitration and Conciliation Act, 1996, called for interference on the ground that the termination of the contract was illegal and the claim amounts were wrongly awarded and the counterclaim was wrongly rejected.

Analysis: The findings that the termination was illegal were returned by the arbitral tribunal on appreciation of evidence and interpretation of the contractual terms. Those findings were accepted by the court below in proceedings under Sections 34 and 37. The limited supervisory jurisdiction under the Arbitration and Conciliation Act, 1996 does not permit reappreciation of evidence as an appellate court. Interference is warranted only where the award is perverse, contrary to the evidence, or otherwise suffers from a recognized ground of interference. The award also showed application of mind to each claim, allowing some in full, some partly, and disallowing others, while the counterclaim was rejected as a consequence of the finding on illegal termination.

Conclusion: The award did not suffer from any ground warranting interference, and the challenge to the award and the rejection of the counterclaim failed.

Final Conclusion: The contract termination finding and the resultant award were left undisturbed, and the special leave petition was dismissed.

Ratio Decidendi: An arbitral award based on appreciation of evidence and a plausible interpretation of the contract cannot be interfered with under Sections 34 and 37 of the Arbitration and Conciliation Act, 1996 unless it is perverse or contrary to the evidence or public policy.

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