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Case Snapshot
Case Name: Union of India & Others v. Hariom Projects Pvt. Ltd.
Citation: 2026 INSC 1044
Bench: Justice Aravind Kumar & Justice Prasanna B. Varale
Date of Judgment: September 18, 2026
Area of Law: Arbitration and Conciliation Act, 1996 — Sections 9, 17, and 37 — Appellate Jurisdiction — Remission of Proceedings
The Judgment in One Line
The Supreme Court held that a High Court cannot, while exercising appellate jurisdiction under Section 37, remit the proceedings to an arbitral tribunal to be treated as a Section 17 application.
Why this Judgement Matters
This judgment provides crucial clarity on the distinct nature of powers exercised by courts and arbitral tribunals under the Arbitration and Conciliation Act, 1996. The Supreme Court held that the appellate jurisdiction under Section 37 is vested exclusively in the "Court" as defined under Section 2(1)(e) of the Act, and an arbitral tribunal exercising powers under Section 17 cannot exercise appellate or supervisory jurisdiction over an order passed by a competent court under Section 9. The judgment reinforces the statutory scheme and judicial hierarchy under the Act and clarifies that the nature and source of powers exercised by an appellate court under Section 37 are fundamentally distinct from those conferred upon an arbitral tribunal under Section 17. This will guide future practice in arbitration matters.
Background
The respondent company was awarded a contract by the appellant for providing Administrative and Training Infrastructure at NDA Khadakwasla. Disputes arose regarding adjustments, payment calculations, and design issues. The respondent filed a writ petition seeking constitution of a Dispute Resolution Board (DRB), which was allowed. The DRB rejected all claims of the respondent.
The respondent invoked the arbitration clause and sought appointment of a Sole Arbitrator. The appellants issued a show cause notice alleging deficiencies and demanded recovery of Rs. 1,46,40,147.32. The respondent filed an application under Section 9 seeking interim reliefs, which was dismissed by the District Judge, Pune.
The respondent filed an appeal under Section 37 and also a petition under Section 11 seeking appointment of an Arbitrator. The High Court appointed Maj. Gen. R.K. Mattu as Arbitrator and directed that the proceedings before it under Section 37 be remitted to the Arbitral Tribunal to be treated as an application under Section 17. The Union of India challenged this direction.
Issues Before the Court
Whether the High Court, while exercising statutory appellate jurisdiction under Section 37(1)(b) against rejection of an application under Section 9, can by consent of parties remit the appellate proceedings to the Arbitral Tribunal to be treated as an application under Section 17.
Whether an Arbitral Tribunal can exercise appellate or supervisory jurisdiction over an order passed by a competent court under Section 9.
Whether the direction to treat Section 37 proceedings as a Section 17 application amounts to impermissible delegation of the High Court's appellate function.
What Did the Supreme Court Hold?
Appellate Jurisdiction Under Section 37 is Exclusive
The Court held 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.
The nature and source of powers exercised by an appellate court under Section 37 are distinct from the powers conferred upon an Arbitral Tribunal under Section 17 and cannot be interchanged merely by transmitting or remitting the appellate proceedings to the Tribunal.
Remission of Proceedings Impermissible
The direction contained in the impugned order remitting the proceedings pending before the High Court to the Arbitral Tribunal and requiring them to be treated as an application under Section 17 cannot be sustained.
The effect of such a 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.
An Arbitral Tribunal, being a creature of the contract, cannot exercise appellate or supervisory jurisdiction vested by statute in the Courts, even by consent of the parties.
Proper Course
At the highest, upon constitution of the Arbitral Tribunal, the High Court could have granted liberty to the respondent-claimant to independently approach the Arbitral Tribunal under Section 17 of the Act for such interim measures as may be available in law.
The prayer sought under the application filed under Section 9 to restrain the appellants from terminating the contract had got spent itself by virtue of termination of the work order on January 3, 2026.
Any further or consequential interim protection thereafter would necessarily have to be considered in the light of subsequent events and the relief specifically sought by the respondent-claimant.
Respondent's Concession
The learned Senior Counsel for the respondent fairly submitted that the direction of the High Court requiring the Arbitral Tribunal to treat the proceedings pending before it under Section 37 as proceedings under Section 17 cannot be sustained, as the same is impermissible in law.
Constitution of Arbitral Tribunal Upheld
The Court noted that the Arbitral Tribunal has already commenced proceedings, and the parties have entered into a Supplementary Agreement dated April 24, 2026.
The constitution of the Arbitral Tribunal was not set aside, and the Tribunal was permitted to continue adjudicating the disputes between the parties.
Key Legal Principles
Exclusive appellate jurisdiction: The appellate jurisdiction under Section 37 of the Arbitration and Conciliation Act, 1996 is vested exclusively in the "Court" as defined under Section 2(1)(e).
Distinct powers: The powers exercised by a court under Section 9 and Section 37 are fundamentally distinct from the powers of an Arbitral Tribunal under Section 17.
No delegation by consent: An Arbitral Tribunal cannot exercise appellate or supervisory jurisdiction vested by statute in courts, even by consent of the parties.
No interchange of powers: The nature and source of powers exercised by an appellate court under Section 37 cannot be interchanged with those conferred upon an Arbitral Tribunal under Section 17.
Proper course: Upon constitution of an Arbitral Tribunal, the High Court may grant liberty to a party to independently approach the Tribunal under Section 17 for interim measures.
Spent prayers: Interim reliefs sought under Section 9 that have become spent due to subsequent events must be considered in light of those events.
Important Precedents
No specific Supreme Court precedents were cited in this brief order. The Court relied on the statutory scheme of the Arbitration and Conciliation Act, 1996.
Practical Impact
For advocates, this judgment provides a clear precedent that a High Court cannot remit a Section 37 appeal to an arbitral tribunal to be treated as a Section 17 application. It will be cited in arbitration matters where courts attempt to delegate their appellate functions to arbitral tribunals. For litigants, it clarifies that the proper course is to independently approach the arbitral tribunal under Section 17 for interim measures after the tribunal is constituted. For law students, it illustrates the distinction between the powers of courts and arbitral tribunals under the Act.
Lawcurb Quick Insight
The judgment highlights that even by consent of parties, an arbitral tribunal cannot exercise appellate jurisdiction. The consent of parties cannot confer jurisdiction that the statute vests exclusively in courts.
Lawcurb Practice Note
When seeking interim reliefs in arbitration matters, file a separate application under Section 17 before the arbitral tribunal after its constitution, rather than attempting to convert a Section 37 appeal into a Section 17 application.
Remember this Ratio
A High Court cannot, while exercising appellate jurisdiction under Section 37, remit the proceedings to an arbitral tribunal to be treated as a Section 17 application, as the powers are distinct and cannot be interchanged.
Final Outcome
The Supreme Court allowed the appeal in part.
The direction of the High Court remitting the Section 37 proceedings to the Arbitral Tribunal to be treated as a Section 17 application was set aside.
The constitution of the Arbitral Tribunal was not set aside.
The Arbitral Tribunal was permitted to continue adjudicating the disputes between the parties.
The appeal was disposed of with the above modification.
Lawcurb Verdict
This judgment is a significant clarification on the distinct powers of courts and arbitral tribunals under the Arbitration and Conciliation Act, 1996. By holding that a High Court cannot remit a Section 37 appeal to an arbitral tribunal to be treated as a Section 17 application, the Supreme Court has reinforced the statutory scheme and judicial hierarchy. The judgment will guide future practice in arbitration matters and prevent impermissible delegation of appellate functions to arbitral tribunals. A well-reasoned and legally sound order.
Exam Lens
Question 1: Can a High Court remit a Section 37 appeal to an arbitral tribunal to be treated as a Section 17 application?
Answer: No. The Supreme Court in Union of India v. Hariom Projects Pvt. Ltd. held that the appellate jurisdiction under Section 37 is vested exclusively in the "Court" as defined under Section 2(1)(e) of the Arbitration and Conciliation Act, 1996. An Arbitral Tribunal exercising powers under Section 17 cannot exercise appellate or supervisory jurisdiction over an order passed by a competent court under Section 9. The nature and source of powers are distinct and cannot be interchanged.
Question 2: What is the proper course for a party seeking interim reliefs after the constitution of an arbitral tribunal?
Answer: The proper course is to independently approach the arbitral tribunal under Section 17 of the Act for such interim measures as may be available in law. The High Court may grant liberty to the party to do so upon constitution of the tribunal.
Question 3: Can consent of parties confer appellate jurisdiction on an arbitral tribunal?
Answer: No. An Arbitral Tribunal, being a creature of the contract, cannot exercise appellate or supervisory jurisdiction vested by statute in courts, even by consent of the parties. Consent cannot confer jurisdiction that the statute vests exclusively in courts.
This report is prepared by Lawcurb for educational and informational purposes only. It is a concise summary of the judgment and should not be construed as legal advice. Readers are encouraged to refer to the original judgment before relying on any legal proposition.