A) ABSTRACT / HEADNOTE

The case Bombay Slum Redevelopment Corporation Private Limited v. Samir Narain Bhojwani addresses the scope of appellate jurisdiction under Section 37(1)(c) of the Arbitration and Conciliation Act, 1996. The Supreme Court examined whether the Division Bench of the Bombay High Court was correct in remanding a matter decided under Section 34 to the Single Judge for reconsideration. The Single Judge had extensively considered and set aside an arbitral award for reasons including patent illegality and lack of jurisdiction by the Arbitral Tribunal. The Division Bench, however, held that several issues were not addressed by the Single Judge, leading to a remand. The Supreme Court, interpreting the narrow jurisdiction under Sections 34 and 37, found the remand order unnecessary. The case reinforces the principle that remands should only occur in exceptional circumstances and highlights the restrictive supervisory role of courts in arbitration.

Keywords:
Section 34 of Arbitration and Conciliation Act, 1996; Section 37 of Arbitration Act; Remand Powers; Patent Illegality in Arbitration; Appellate Jurisdiction.

B) CASE DETAILS

i) Judgment Cause Title:
Bombay Slum Redevelopment Corporation Private Limited v. Samir Narain Bhojwani

ii) Case Number:
Civil Appeal No. 7247 of 2024

iii) Judgment Date:
8 July 2024

iv) Court:
Supreme Court of India

v) Quorum:
Abhay S. Oka and Pankaj Mithal, JJ.

vi) Author:
Justice Abhay S. Oka

vii) Citation:
[2024] 7 S.C.R. 136 : 2024 INSC 478

viii) Legal Provisions Involved:

• Arbitration and Conciliation Act, 1996 – Sections 34, 37, 19
• Code of Civil Procedure, 1908 (Referenced for analogy)
• Specific Relief Act, 1963 – Section 14

ix) Judgments Overruled by the Case:
None explicitly mentioned.

x) Case is Related to which Law Subjects:
Arbitration Law, Civil Procedure.

C) INTRODUCTION AND BACKGROUND OF JUDGMENT

The dispute arose from the development of a slum rehabilitation project in Mumbai under a tripartite agreement involving slum dwellers, developers, and financial entities. Conflicting claims emerged over compliance with contractual obligations, leading to arbitration proceedings. The Arbitral Tribunal rendered an award favoring the claimant (Samir Narain Bhojwani), which was challenged under Section 34. The Single Judge invalidated the award, citing jurisdictional overreach and perversity in the Tribunal’s findings. However, the Division Bench, on appeal under Section 37, remanded the matter, asserting that the Single Judge failed to address key issues.

D) FACTS OF THE CASE

1. Background Agreements:
   The Maharashtra Housing and Area Development Authority (MHADA) leased property to a cooperative housing society of slum dwellers in 1993, which appointed Aurora Properties and Investments as the developer. Due to non-performance, rights were transferred to Bombay Slum Redevelopment Corporation Pvt. Ltd. in 1999.

2. Tripartite Agreement:
   The developer subcontracted construction rights to Samir Narain Bhojwani, retaining 45% of the Floor Space Index (FSI) while granting 55% to Bhojwani. Subsequent agreements formalized roles and financial obligations.

3. Arbitral Award:
   Bhojwani alleged breaches of contract by the developer, leading to arbitration proceedings. The Tribunal awarded substantial damages and reliefs to Bhojwani, while rejecting counterclaims by the developer.

4. Challenge Under Section 34:
   The Single Judge set aside the award, citing patent illegality, exceeding jurisdiction, and enforcement challenges.

5. Remand by Division Bench:
   On appeal, the High Court Division Bench remanded the matter for fresh consideration, claiming non-addressal of several issues.

E) LEGAL ISSUES RAISED

1. Does Section 37 allow appellate courts to remand a matter decided under Section 34?
2. Did the Single Judge address all relevant issues before setting aside the arbitral award?
3. What is the scope of interference under Sections 34 and 37 of the Arbitration Act?

F) PETITIONER’S ARGUMENTS

The counsel for Bombay Slum Redevelopment Corporation submitted:

1. Section 37 Jurisdiction: Remands are permissible only in exceptional cases. The Single Judge had already dealt with all issues in detail.
2. Detailed Analysis by Single Judge: The judgment spans over 101 pages, comprehensively addressing jurisdiction, illegality, and evidence.
3. Efficient Arbitration: Routine remands undermine the cost-effectiveness and efficiency of arbitration, contrary to its objectives under the Arbitration Act.
4. Misinterpretation by Division Bench: Criticism of the Single Judge’s findings is misplaced, and the appellate court should have decided the matter on merits.

G) RESPONDENT’S ARGUMENTS

The counsel for Samir Narain Bhojwani countered:

1. Fair Reconsideration Needed: The Single Judge overlooked critical issues, such as the validity of contractual provisions and factual aspects affecting the arbitral award.
2. Exceptional Cases Warrant Remand: When significant gaps in reasoning exist, appellate courts must intervene for justice.
3. Support from Precedents: The remand aligns with judicial principles emphasizing comprehensive adjudication of arbitration disputes.

H) RELATED LEGAL PROVISIONS

i) Arbitration and Conciliation Act, 1996:

• Section 34: Limited grounds for challenging an arbitral award.
• Section 37: Appellate jurisdiction over orders under Section 34.
• Section 19: Non-applicability of the CPC.

ii) Specific Relief Act, 1963:

• Section 14: Restriction on specific performance requiring continuous court supervision.

I) JUDGMENT

a. Ratio Decidendi:

1. The jurisdiction of appellate courts under Section 37 is narrower than that of Section 34 courts.
2. Remand is permissible only in exceptional circumstances, such as summary disposal or procedural irregularities.
3. The Single Judge had adequately addressed all issues, making the Division Bench’s remand order unwarranted.

b. Obiter Dicta:

1. Courts must discourage extensive, irrelevant pleadings in arbitration disputes to maintain efficiency.
2. Legal representatives and counsels should exercise restraint in raising redundant grounds.

c. Guidelines:

1. Appellate courts under Section 37 should decide cases on merits unless exceptional grounds for remand exist.
2. Arbitral procedures must adhere to cost-effectiveness and limited judicial supervision.

J) REFERENCES

a. Important Cases Referred:

1. MMTC Limited v. Vedanta Limited [(2019) 4 SCC 163]
2. UHL Power Company Limited v. State of Himachal Pradesh [(2022) 4 SCC 116]
3. Konkan Railway Corporation Limited v. Chenab Bridge Project Undertaking [(2023) 9 SCC 85]

b. Important Statutes Referred:

1. Arbitration and Conciliation Act, 1996
2. Specific Relief Act, 1963
3. Code of Civil Procedure, 1908 (analogous reference).