High Court cannot remit appeal Section 37 of Arbitration Act to Arbitral Tribunal: SC

Establishing that arbitral tribunals do not possess statutory supervisory or appellate jurisdiction over judicial orders, a two-judge bench comprising Justice Aravind Kumar and Justice Prasanna B. Varale curtailed the procedural shortcut of delegating judicial appeal functions to private tribunals. The Bench emphasized that an appellate court exercising statutory powers on appeal under Section 37 of the Arbitration and Conciliation Act, 1996 cannot, even with party consent, remit its appellate proceedings to an Arbitral Tribunal to be treated as an interim application under Section 17.

Courts Observation and Ratio

The Supreme Court partially set aside the order of the High Court, holding that an arbitral tribunal cannot exercise appellate review over court decisions. The Bench explained that  “The appellate jurisdiction under Section 37 is vested exclusively in the 'Court' as contemplated under Section 2(1)(e) of the Act. An Arbitral Tribunal exercising powers under Section 17 does not exercise appellate jurisdiction over an order passed by a competent Court under Section 9. Consequently, the effect of the impugned direction would be to require the Arbitral Tribunal to examine the subject matter of a statutory appeal under Section 37 by treating the appellate proceedings as an application under Section 17. The nature and source of the powers exercised by an appellate Court under Section 37 are distinct from the powers conferred upon an Arbitral Tribunal under Section 17 and same cannot be interchanged merely by transmitting or remitting the appellate proceedings to the Tribunal.”

Background

The dispute originated from a contract awarded to Hariom Projects Pvt. Ltd. by the Union of India for infrastructure construction at NDA Khadakwasla. Following disagreement over payments and adjustments, the respondent invoked arbitration and sought interim protection under Section 9 of the Arbitration and Conciliation Act, 1996 before the District Judge, Pune. The District Judge rejected the application for interim relief.

Aggrieved, the respondent filed a statutory appeal under Section 37 along with a petition under Section 11 seeking the appointment of an arbitrator. During these proceedings, the contract was terminated, but the termination was stayed by the High Court. By consent, the High Court appointed a Sole Arbitrator and directed that the pending appellate proceedings under Section 37 be remitted to the newly constituted Arbitral Tribunal to be treated as an interim application under Section 17 of the Act.

The Union of India challenged this specific direction of remitting appellate proceedings to the tribunal before the Supreme Court. The Supreme Court clarified the legal principle and set aside the High Court's order to the limited extent of remitting the Section 37 proceedings to the arbitral tribunal.

Case Details:
Case No.: Civil Appeal No. of 2026 (@ SLP (Civil) No. 33087 of 2026)
Neutral Citation: 2026 INSC 1044
Case Title: Union of India & Others v. Hariom Projects Pvt. Ltd.
Appearances:
For the Petitioner(s): Shri Kanakamedla Ravindra Kumar, Learned Additional Solicitor General
For the Respondent(s): Shri Aditya Sondhi, Learned Senior Counsel

Source: 2026 CaseBase(SC) 8090