Courts can modify arbitral awards, Supreme Court holds in majority verdict

By a 4:1 majority verdict, the Supreme Court on Wednesday held courts could modify arbitral awards under the 1996 law on arbitration and conciliation.

A five-judge Constitution bench headed by Chief Justice Sanjiv Khanna and three judges -- Justices B R Gavai, Sanjay Kumar and and Augustine George Masih -- concurred on the contentious issue and held that courts are empowered to modify the awards with "caution".

"The question of law is answered to say that the court has limited power to modify arbitral awards under Sections 34 & 37 of the Arbitration and Conciliation Act, 1996," the CJI Khanna, who wrote for himself and three other judges, said.


Justice K V Viswanathan, however, dissented and held courts couldn't alter the arbitral awards.

The court had on February 19 reserved its judgement on the contentions issue.