NEW DELHI – In a recent decision, the Delhi High Court bench, comprising Justice Yashwant Varma and Justice Ravinder Dudeja, overturned a District Judge’s order regarding the application of Section 42 of the Arbitration and Conciliation (A&C) Act. The case involved a writ petition filed under Article 227, challenging the District Judge’s decision to return a Section 34 petition, which was initially filed to challenge an arbitral award.
The High Court found that the District Judge had misinterpreted Section 42 by incorrectly ruling that the Section 34 petition should be filed before the High Court instead of the District Commercial Court. The District Judge’s reasoning was based on the fact that a previous petition under Section 11(6) had been filed before the High Court, which he believed vested the High Court with exclusive jurisdiction for all subsequent applications, including the Section 34 petition.
However, the High Court, while exercising its supervisory jurisdiction under Article 227, set aside the District Judge’s order, stating that this interpretation of Section 42 was fundamentally flawed and would have caused irreparable harm to the petitioner. The High Court clarified that a Section 11 petition, filed before the Chief Justice or their delegate, does not qualify as a petition filed in a “court” as defined under Section 2(1)(e) of the A&C Act, and hence, does not attract the provisions of Section 42.
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The Court also considered the concerns raised about the maintainability of the writ petition under Article 227, given the existence of alternative remedies under Section 37 of the A&C Act. Nonetheless, based on the Supreme Court’s decisions in cases like BGS SGS Soma JV v. NHPC Ltd. (2020) and State of West Bengal v. Associated Contractors (2015), the High Court concluded that supervisory jurisdiction was appropriate in this instance, as the District Judge’s decision was based on a gross misinterpretation of the law.
The Court further noted that the role of Article 227 is not to correct every error by lower courts but to intervene in cases where an error results in grave injustice, as was the case here. Consequently, the High Court allowed the writ petition and quashed the District Judge’s erroneous order.