Key Observations

• High Court’s Role Limited: Interference under Articles 226/227 of the Constitution of India in arbitration matters is permissible only in cases of complete perversity that “must stare in the face.”
• Judicial Restraint in Arbitration: Excessive judicial interference can undermine the efficiency and integrity of the arbitral process. Courts must exercise jurisdiction in “exceptional rarity” or cases of bad faith.
• Perversity Not Established: The Supreme Court noted that the High Court had failed to identify any explicit perversity in the Arbitral Tribunal’s decision to deny further cross-examination of a witness.

Judgment Highlights

1. The Arbitral Tribunal had already provided adequate time for cross-examination, which spanned over multiple sessions totaling more than 12 hours.
2. The High Court’s reasoning—relying on general principles of cross-examination—did not justify overruling the Tribunal’s decision.
3. The Supreme Court reinstated the Arbitral Tribunal’s order, emphasizing the need for courts to respect the autonomy of arbitration.

Background

The case arose from a contractual dispute between Serosoft Solutions Pvt. Ltd. and Dexter Capital Advisors Pvt. Ltd. regarding unpaid advisory fees. After the Tribunal denied further cross-examination time for a witness (RW-1), the respondent approached the High Court, which reversed the Tribunal’s order. The Supreme Court overruled the High Court, upholding the Tribunal’s decision.

Supreme Court’s Directions

• The Arbitral Tribunal should resume proceedings promptly and conclude them expeditiously.

Read the Complete Judgment

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This judgment underscores the importance of judicial restraint in arbitration and reinforces the principle of minimal court interference in arbitral proceedings.