Calcutta High Court Curtails Article 227 Intervention in Section 37 Arbitration Appeals

The Calcutta High Court has reinforced the principle of judicial non-interference in commercial arbitrations, ruling that Article 227 cannot be invoked to bypass the discretionary powers of Commercial Courts unless a patent jurisdictional error is demonstrated. The decision effectively shields interlocutory orders in arbitration appeals from routine constitutional challenges, ensuring that the specialized mechanism of the Arbitration Act remains the primary theatre for dispute resolution.

A single-judge bench comprising Justice Hiranmay Bhattacharyya adjudicated upon a revisional application challenging an order of the Alipore Commercial Court. The petitioner sought an ex-parte ad interim injunction in an appeal filed under Section 37 of the Arbitration & Conciliation Act, 1996, following the Arbitral Tribunal's refusal to extend joint measurement mandates for unexecuted works.

Key Takeaways

Narrow Gate for Constitutional Revision

High Courts will not exercise supervisory jurisdiction under Constitution of India against interim orders in commercial matters unless the order is patently without jurisdiction.

Arbitral Autonomy in Evidence

Determining the quantity and value of balance/unexecuted works is a matter of evidence for the Arbitral Tribunal, not a mandatory subject for Joint Special Officers.

Section 37 Finality

Parties cannot use revisional applications to stall the opening of price bids or tender processes if the fundamental evidentiary measurement of their completed work is already documented.

Court Observations and Directions

The Court observed that the Arbitral Tribunal had already completed the exercise of measuring all finished and unfinished works done by the petitioner through Joint Special Officers. It held that the petitioner’s demand to measure 'balance work' was essentially a matter of future adjudication based on evidence rather than a prerequisite for the tendering of new contracts.

The Court, in its reasoning, observed: "This Court is of the prima facie view that ascertainment of the quantity and value of the unexecuted balance work of the project is the matter of adjudication by the Tribunal on the basis of evidence that may be led by the parties. When the Joint Special Officers have been discharged by the Arbitral Tribunal by an order dated 09.09.2026, there was no scope to pass an ex parte ad interim order without hearing the other side."

The Court has following directions:
"CO No. 3192 of 2026 stands dismissed. There shall be, however, no order as to costs. Urgent photostat certified copies, if applied for, be supplied to the parties upon compliance of all formalities."

Ratio

The High Court’s supervisory jurisdiction under Article 227 of the Constitution of India is extremely circumspect and narrow in matters arising from the Arbitration & Conciliation Act, 1996. Interference is warranted only when an order is passed patently without jurisdiction; it cannot be invoked to correct perceived errors in discretionary interim orders passed by a Commercial Court in an appeal under Section 37 of the Act.

Background

The dispute originated from a construction contract between M/s. Tribeni Construction Ltd. and Damodar Valley Corporation (DVC). Following termination, an Arbitrator was appointed under Section 11 of the Arbitration & Conciliation Act, 1996. The petitioner filed multiple applications under Section 17, seeking joint measurements of works. While measurements of 'works done' were conducted by Joint Special Officers, the petitioner sought further measurements of the 'incomplete/balance work' to prevent DVC from floating a new tender.

The Arbitral Tribunal dismissed the third Section 17 application, holding that 'incomplete work' refers to what the claimant started but could not finish, which had already been measured. The petitioner challenged this before the Commercial Court under Section 37, but the court refused an ex-parte stay on DVC's price bid opening. The High Court, relying on Durgapur Freight Terminal Pvt. Ltd. vs. Titagarh Logistics Infrastructure Pvt. Ltd. & other and Ashok Kumar Puri and another vs. S. Suncon Realtors Pvt. Ltd. & Anr., upheld the Commercial Court's refusal, noting that no jurisdictional error existed to justify interference under Constitution of India.

Case Details:
Case No.: C.O. 3192 of 2026
Neutral Citation: 2026:CHC-AS:1683
Case Title: M/s. Tribeni Construction Ltd. Vs. Damodar Valley Corporation
Appearances:
For the Petitioner(s): Mr. Shuvasish Sengupta, Mr. Sourajit Dasgupta, Mr. Soumyajit Mishra, Ms. Utsa Podder, Advocates
For the Respondent(s): Mr. Sabyasachi Chowdhury, Sr. Adv., Mr. Deepan Sarkar, Mr. Prasun Mukherjee, Mr. Deepak Agarwal, Advocates

Source: 2026 CaseBase(CAL) 2922