Arbitration objections and public policy broadened: Section 34 can consider non-arbitrability, and Indian law includes State law.

A jurisdictional or non-arbitrability objection may be examined in Section 34 proceedings even if not raised before the arbitral tribunal under Section 16, because the post-award challenge is not barred merely by omission at the tribunal stage. The expression "public policy of India" was held to extend to the law in force in India as a whole, including State law where contextually relevant, and not only to Central law. The earlier restrictive view was disapproved, leaving the Section 34 objections for consideration on that broader basis.

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Issues: (i) whether a jurisdictional objection not raised before the arbitral tribunal under Section 16 could still be raised in proceedings under Section 34; (ii) whether the expression "public policy of India" is confined to Central law or extends to law in force in India, including State law.

Issue (i): whether a jurisdictional objection not raised before the arbitral tribunal under Section 16 could still be raised in proceedings under Section 34.

Analysis: The statutory scheme recognises a distinction between objections going to the tribunal's jurisdiction and a contention that the subject matter itself is not arbitrable. A plea that the dispute is incapable of settlement by arbitration may be examined by the court under Section 34, and the absence of a prior objection under Section 16 does not, by itself, bar such a contention in the post-award challenge.

Conclusion: The jurisdictional plea was not barred merely because it had not been raised under Section 16 and could be considered in Section 34 proceedings.

Issue (ii): whether the expression "public policy of India" is confined to Central law or extends to law in force in India, including State law.

Analysis: The phrase "public policy of India" was held to refer to the law in force in India as a whole. It is not limited to Union law alone, and in an appropriate context may encompass both Central and State enactments. The contrary observations in the earlier decision were overruled.

Conclusion: "Public policy of India" includes both Central and State law in force in India.

Final Conclusion: The impugned order was set aside, the matter was left for consideration of the Section 34 objections by the trial court, and the earlier restrictive view on jurisdiction and public policy was disapproved.

Ratio Decidendi: A plea that the dispute is not arbitrable or is otherwise within the scope of Section 34 may be raised even if not taken under Section 16, and the expression "public policy of India" extends to the law in force in India, including State law where contextually relevant.

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