A) ABSTRACT / HEADNOTE

Serosoft Solutions Pvt. Ltd. v. Dexter Capital Advisors Pvt. Ltd., [2025] 1 S.C.R. 151 : 2025 INSC 26 examines the limits of High Court supervisory intervention under Article 227 in respect of interlocutory directions of an arbitral tribunal concerning opportunity for cross-examination. The dispute arose from a client services contract and focused on whether the claimant/respondent ought to be granted an additional chance to cross-examine the defendant/appellant’s witness RW-1 after the Arbitral Tribunal had refused further time on grounds of time-bound proceedings and lack of preparedness. The Supreme Court emphasized statutory restraint on judicial interference under Part I of the Arbitration and Conciliation Act, 1996 and reiterated that intervention under Articles 226/227 is permissible only in exceptional circumstances where an order of the tribunal is perverse or the denial of a fundamental, effective opportunity to present one’s case is plainly established. The Court found that the tribunal had repeatedly provided extensive cross-examination time (exceeding twelve hours across sessions), had extended mandate by consent under Section 29A, and had discharged RW-1 after substantive questioning. The High Court’s direction to reopen cross-examination was set aside for lack of any demonstrated perversity or denial of a fair opportunity. The Arbitral Tribunal was directed to resume and conclude proceedings expeditiously.

Keywords: Article 227, Section 29A, Arbitration and Conciliation Act, 1996, cross-examination, supervisory jurisdiction.

B) CASE DETAILS

C) INTRODUCTION AND BACKGROUND OF JUDGMENT

The dispute emanated from a Client Service Agreement under which the claimant (Dexter) provided capital advisory services to the appellant (Serosoft) and alleged non-payment of fees, leading to arbitration. After constitution of the tribunal, pleadings and framing of issues, witness-examination followed and procedural friction arose during cross-examination of RW-1 (the appellant’s witness). The record shows staggered cross-examinations across dates initial questions on 09.12.2023, an extended session on 10.02.2024 (11 a.m. to 7 p.m., c.104 questions), and further questioning after an extended mandate on 01.10.2024 (5.35 p.m. to 7.40 p.m., c.28 questions).

The tribunal, noting repeated ad-hoc requests, exhausted time and refused a further extension by order dated 09.10.2024 stressing the time-bound nature of proceedings and perceived lack of preparedness. The claimant approached the High Court under Article 227 which directed the tribunal to grant another opportunity to cross-examine RW-1. The Supreme Court, on appeal, analyzed whether such supervisory interference was justified given the twin statutory duties: the tribunal’s obligation of equal treatment and the judiciary’s concomitant duty to show restraint in interfering with arbitral process governed by Part I of the Arbitration Act.

The Court applied the threshold that interference under Articles 226/227 is warranted only where an order is completely perverse or otherwise shocks judicial conscience a stringent standard adopted from earlier authority (e.g., Kelvin Air Conditioning & Ventilation Sys. Pvt. Ltd. v. Triumph Reality Pvt. Ltd.). On reviewing the record and chronology, the Court concluded that the tribunal had afforded ample opportunity and that the High Court failed to identify perversity or a real denial of an effective cross-examination, thereby setting aside the High Court’s order.

D) FACTS OF THE CASE

1. Parties and contract: Serosoft Solutions Pvt. Ltd. (appellant) engaged Dexter Capital Advisors Pvt. Ltd. (respondent) under a Client Service Agreement for advisory services; dispute concerned unpaid fees and was referred to arbitration.
2. Constitution of tribunal and initial hearings: The Section 11 petition was allowed on 08.05.2023, tribunal constituted and first hearing on 19.05.2023. Issues were framed by the tribunal on 06.09.2023.
3. Witnesses and examination chronology: Respondent produced CW-1 and CW-2; cross-examination by appellant completed in November 2023. Cross-examination of appellant’s witness RW-1 began 09.12.2023 (9 questions), continued 10.02.2024 (11 a.m.–7 p.m.; ~104 questions) and resumed after mandate extension on 01.10.2024 (5.35 p.m.–7.40 p.m.; ~28 questions). The tribunal recorded that RW-1’s cross-examination stood concluded and the witness was discharged.
4. Interlocutory applications and mandate extension: Respondent sought additional time on 10.02.2024 and the tribunal granted a one-hour extension but later adjourned to 06.04.2024. Multiple discovery/interrogatory applications and consensual extensions under Section 29A led to exhaustion of the tribunal’s mandate; parties extended the mandate by six months. An IA by respondent dated 03.10.2024 again sought extension; tribunal refused on 09.10.2024 citing lack of preparedness and the time-bound nature of proceedings.
5. High Court intervention: The respondent petitioned under Article 227; the High Court (Delhi) directed the tribunal to grant further opportunity to cross-examine RW-1, considering cross-examination to be essential for truth-finding. The appellant challenged that order before the Supreme Court.

E) LEGAL ISSUES RAISED 

i. Whether the High Court correctly exercised supervisory jurisdiction under Article 227 in directing the Arbitral Tribunal to grant further cross-examination time after the tribunal had declined such relief?

ii. Whether the tribunal’s refusal to permit additional cross-examination amounted to denial of equal treatment or an effective opportunity to present the respondent’s case under Section 18?

iii. What is the scope and standard of judicial review under Articles 226/227 in interference with arbitral proceedings governed by Part I of the Arbitration Act?

F) PETITIONER / APPELLANT’S ARGUMENTS

i. The counsels for Petitioner / Appellant submitted that the Arbitral Tribunal had repeatedly afforded adequate time for cross-examination of RW-1 across multiple sessions (total exceeding twelve hours), had permissibly exercised case-management, and had validly rejected further extension as the mandate was time-bound under Section 29A. The High Court’s interference upset the autonomy and efficiency of the arbitral process and lacked any finding of perversity.

ii. The counsels argued that reopening cross-examination after the tribunal discharged the witness and fixed final arguments would prejudice case administration, promote dilatory tactics, and run afoul of the statutory philosophy of minimal judicial intervention in arbitration.

G) RESPONDENT’S ARGUMENTS

i. The counsels for Respondent submitted that cross-examination is a core mode of ascertaining truth and the respondent had a right to an effective opportunity to test the witness; exceptional circumstances warranted supplementation of time.

ii. They contended that multiple discovery applications and interruptions prevented adequate and contiguous cross-examination earlier; the High Court’s supervisory power under Article 227 could be exercised to secure fairness and remedy any procedural deficiency.

H) JUDGMENT 

The Supreme Court allowed the appeal, set aside the High Court order, and remitted the matter to the Arbitral Tribunal to resume and conclude proceedings expeditiously. The Court balanced the tribunal’s duty under Section 18 to provide equal treatment with the constitutional doctrine of judicial restraint in Part I arbitration matters. After examining the hearing chronology and transcript, the Court observed that the tribunal had repeatedly granted and scheduled extended sessions, accommodated adjournments, and ultimately discharged RW-1 after substantial questioning.

The tribunal’s refusal to grant yet another extension on 09.10.2024 was a reasoned exercise of case-management in view of time constraints and the extended mandate under Section 29A. The High Court failed to demonstrate perversity in the tribunal’s order the threshold required for interference under Articles 226/227 and relied on normative appreciation of cross-examination rather than on any palpable miscarriage of justice.

Accordingly, the High Court’s direction was interferential and contrary to the statutory scheme favouring minimal judicial intrusion into arbitral conduct. The Court therefore allowed the appeals, set aside the impugned order dated 25.10.2024, and directed the tribunal to proceed expeditiously.

a. RATIO DECIDENDI

The controlling ratio is twofold: first, a tribunal’s case-management decisions about allotment of time for examination are within its domain and, unless shown to be completely perverse, are not to be lightly disturbed by writ jurisdiction; second, judicial interference under Articles 226/227 in arbitration governed by Part I of the Arbitration Act must be exercised with restraint and only in exceptional cases where there is an evident denial of a fundamental opportunity or perverse decision.

The Court applied these principles to the facts, holding that repeated long sessions (including an 8-hour session and additional sessions after mandate extension) demonstrated that RW-1 had been thoroughly tested and that the tribunal’s refusal to grant more time did not amount to a denial of a fair hearing. The High Court’s order lacked any finding of perversity and therefore was set aside.

b. OBITER DICTA 

The Court reiterated (obiter) the normative value of cross-examination as a truth seeking tool but stressed that policy-level appreciation of its importance cannot substitute for the statutory constraint on writ jurisdiction. The judgment observed that writ courts must avoid becoming a forum for tactical re-litigation of procedural choices made in arbitration. The Court also referred to guidance from earlier decisions (including Kelvin Air Conditioning & Ventilation Sys. Pvt. Ltd.) that counsel against routine interference and underline the need for exceptional demonstration of bad faith or outright perversity to invoke Articles 226/227. These observations underline the judiciary’s supervisory but restrained role in protecting arbitral autonomy.

c. GUIDELINES 

i. Where an Arbitral Tribunal has recorded reasons for denying further cross-examination, High Courts should require demonstrable proof of perversity or clear denial of an effective opportunity before exercising Article 227 jurisdiction.

ii. Courts must weigh the chronology of proceedings — sessions, durations, adjournments, and consensual mandate extensions under Section 29A — before concluding a party was denied adequate opportunity.

iii. Judicial interference is inappropriate to correct tactical delay or to permit further fishing expeditions; only bona fide incapacity to test evidence due to circumstances outside a party’s control would justify relief.

iv. High Courts should refrain from substituting their own view of what constitutes ideal cross-examination for the tribunal’s discretionary case-management, unless the tribunal’s order is perverse on its face.

v. Parties and counsel should be prepared; repeated requests for time without adequate justification may be held against the requesting party when the tribunal manages proceedings time-boundly.

I) CONCLUSION & COMMENTS

The decision reinforces arbitration autonomy. The Court’s analysis emphasises that supervisory writ jurisdiction is a limited safety valve, not a routine channel to re-open procedural rulings by tribunals. This promotes finality, efficiency and party autonomy core objectives of the Arbitration Act. The judgment also underscores practical lessons for practitioners: meticulously plan cross-examination, avoid piecemeal adjournments, and ensure that any request for additional time is supported by cogent reasons demonstrating actual prejudice if denied.

From a doctrinal perspective, the Court clarified the threshold of perversity and the interplay between Section 18 (equal treatment) and judicial restraint under Part I, providing helpful guidance for future disputes where parties seek High Court intervention in ongoing arbitrations. The directive to the tribunal to conclude proceedings expeditiously balances both fairness and finality.

J) REFERENCES

a. Important Cases Referred

i. Serosoft Solutions Pvt. Ltd. v. Dexter Capital Advisors Pvt. Ltd., [2025] 1 S.C.R. 151 : 2025 INSC 26.
ii. Kelvin Air Conditioning and Ventilation System Pvt. Ltd. v. Triumph Reality Pvt. Ltd., 2024 SCC Online Del 7137 (as relied in judgment).

b. Important Statutes Referred

i. Constitution of India, Article 227.
ii. Arbitration and Conciliation Act, 1996, Sections 18 & 29A.