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        2022 (1) TMI 154 - SC - Indian Laws

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        Section 34(4) remittal is limited to curing reasoning gaps, not absent findings or patent illegality in an arbitral award. Section 34(4) of the Arbitration and Conciliation Act, 1996 permits remittal only to cure inadequate reasons or reasoning gaps where the award already ...
                      Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
                        Provisions expressly mentioned in the judgment/order text.

                            Section 34(4) remittal is limited to curing reasoning gaps, not absent findings or patent illegality in an arbitral award.

                            Section 34(4) of the Arbitration and Conciliation Act, 1996 permits remittal only to cure inadequate reasons or reasoning gaps where the award already contains a finding on the issue. A finding is a decision on a contentious issue; reasons are the support for that decision. Where the award omits any finding on a contentious issue, or where material evidence has been ignored so as to give rise to patent illegality, the defect cannot be cured by remittal under Section 34(4). The provision is discretionary and cannot be used to rewrite the award or allow the tribunal to take a fresh view on the merits after making the award. Remittal was therefore held impermissible on the facts.




                            Issues: Whether, in a challenge to an arbitral award, the Court could remit the matter under Section 34(4) of the Arbitration and Conciliation Act, 1996 for additional reasons when the award was alleged to suffer from absence of a finding on a contentious issue and patent illegality.

                            Analysis: Section 34(4) is available to enable the arbitral tribunal to resume proceedings or take curative action only where there is already a finding in the award and the defect lies in inadequate reasons or gaps in the reasoning. A finding is a decision on an issue, whereas reasons are the links supporting that decision. If the award contains no finding on a contentious issue, or if material evidence has been ignored so as to attract patent illegality, the defect is not one that can be cured by remittal under Section 34(4). The power under Section 34(4) is discretionary and cannot be used to rewrite the award or to permit the tribunal to take a contrary view on the merits after the award has already been made.

                            Conclusion: Remittal under Section 34(4) was not permissible on the facts, and the refusal to remit the award was upheld. The appeal was against the appellant and in favour of the respondent.


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                            ActsIncome Tax
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