Court Affirms that Claims and Counter-claims from Singular Arbitral Reference Can Be Challenged Collectively
In a significant ruling, the Delhi High Court on April 1, 2026, declared that arbitral awards concerning claims and counter-claims arising from a singular arbitral reference can be challenged collectively under Section 34 of the Arbitration and Conciliation Act, 1996. The decision, passed by Justice Harish Vaidyanathan Shankar, reinforces the procedural framework of the Arbitration and Conciliation Act over the procedural norms of the Code of Civil Procedure (CPC) for challenges to arbitral awards.
The case involved M/s Splendor Landbase Limited (Petitioner) and M/s NTT Data Global Delivery Services Private Limited (Respondent), with the former challenging several arbitral awards dated July 5, 2025. The Respondent contended that the awards pertaining to claims and counter-claims should be challenged separately, citing that they assume the status of decrees and thus require separate petitions, which would affect the pecuniary jurisdiction.
However, the court held that arbitral awards do not automatically become decrees upon pronouncement. They only assume the enforceability of a decree once they attain finality as per the Arbitration and Conciliation Act. The judgment further clarified that the procedural framework of the CPC, which necessitates separate appeals for decrees, does not apply to arbitral awards at the pre-enforcement stage.
Justice Shankar noted that the statutory objectives and procedural schemes of the Arbitration and Conciliation Act are fundamentally distinct from those of the CPC, aiming to facilitate efficient and final dispute resolution with minimal court intervention. The court emphasized that the legal fiction created by Section 36 of the Arbitration and Conciliation Act, which treats awards as decrees for enforcement, is limited to execution purposes and does not extend to the challenge process under Section 34.
The decision came after considering various precedents and arguments from both parties, with the court ultimately rejecting the preliminary objection regarding the need for separate petitions. The petitions are maintainable in their current form, thereby allowing the Petitioner to challenge the awards collectively.
The case will be listed for further proceedings on August 12, 2026, as the court directed the registry to take on record the Respondent's reply, which was delayed, and allowed the Petitioner three weeks to file a rejoinder.
Bottom Line:
Under the Arbitration and Conciliation Act, 1996, arbitral awards concerning claims and counter-claims arising from a singular reference can be challenged collectively under Section 34, and do not require separate petitions.
Statutory provision(s): Arbitration and Conciliation Act, 1996 Sections 34, 36, Commercial Courts Act, 2015 Section 12(2)
