Introduction
Three Supreme Court decisions within two years have reopened a single question: how much correction can a court apply to an arbitral award before supervision turns into appeal? The judicial review of arbitral awards sits at the centre of Indian arbitration law today, and the answer given by the Supreme Court in each of these cases carries direct consequences for every party that signs an arbitration clause, prices commercial risk, or relies on Section 34 of the Arbitration and Conciliation Act, 1996 as a limited remedy rather than a second trial.
Three Supreme Court Rulings, One Recurring Question
In DMRC Ltd. v. Delhi Airport Metro Express (P) Ltd., (2024) 6 SCC 357, the Supreme Court entertained a curative petition and set aside an award worth close to INR 7,500 crores after that very award had already survived a Section 34 challenge, a Section 37 appeal, a special leave petition, and a review. In Gayatri Balasamy v. ISG Novasoft Technologies Ltd., (2025) 7 SCC 1, a Constitution Bench ruled by a four-to-one majority that the power to set aside an award under Section 34 carries within it a narrow, implied power to sever and remove clearly invalid portions of an award without striking down the award in its entirety. In Bhupesh Bhayana v. Kunal Seth, 2026 SCC OnLine SC 950, the Court found an award patently illegal, declined to set it aside because the dispute had been litigated since 2012, and instead invoked Article 142 of the Constitution to bring the matter to a close.
Each ruling sits at a different point on the same spectrum. DMRC represents the widest form of intervention because it reopened a concluded award through curative jurisdiction. Gayatri Balasamy attempts to draw a boundary around when correction or modification of an award is permissible. Bhupesh Bhayana shows Article 142 being used narrowly, to close out litigation rather than to rewrite the underlying commercial outcome. Read together, the three rulings raise a concern that goes beyond any single case: an exceptional constitutional power could gradually turn into a routine tool for adjusting commercial results that the Arbitration Act itself was designed to leave untouched.
Why Finality Matters in Commercial Arbitration
Commercial law functions on predictability. When two parties sign a contract, they are not only agreeing on obligations they are allocating risk, fixing remedies for breach, and choosing the forum that will resolve any dispute between them. Each of these choices assumes that the contract and the governing statute will be applied consistently, without being reopened years later on broader equitable grounds.
If an outcome can still be reshaped after the arbitral process and the statutory challenges under Sections 34 and 37 of the Arbitration Act are exhausted, that assumption breaks down. A party may end up satisfied with the result of a particular case while the wider system of commercial dealing becomes less reliable, because every award now carries a residual risk of being revisited long after the parties acted on their bargain. Arbitral finality is not simply a procedural nicety, it is the mechanism that makes arbitration a credible substitute for litigation in the first place.
Article 142 of the Constitution: Scope and Constitutional Limits
Article 142 gives the Supreme Court the power to pass any order necessary for doing “complete justice” in a matter before it. This gives the Court flexibility to shape relief where the ordinary legal process falls short but that same breadth demands restraint in its use.
The settled position, established in Supreme Court Bar Association v. Union of India, (1998) 4 SCC 409, and indicated earlier in Prem Chand Garg v. Excise Commissioner, 1962 SCC OnLine SC 37, is that Article 142 can supplement the law but cannot supplant it. It may fill a genuine remedial gap in a specific case; it cannot be used to produce a result that the applicable statute does not permit.
The provision has done its most valuable work in situations where the existing legal framework was absent, inadequate, or too slow to respond to injustice, the release of undertrial prisoners, environmental protection orders, compensation schemes for mass harm, and the framing of workplace-safety guidelines before Parliament legislated on the subject. These were not disputes between commercial parties asserting rights under a negotiated contract.
Commercial parties, by contrast, are governed by a contract they negotiated, limitation periods they are presumed to know, remedies they agreed upon, and a forum they selected. The consequences of these choices are usually priced into the transaction itself. A party may take on an unfavourable risk, agree to an imperfect clause, allow a remedy to lapse, or lose before the forum it chose and the resulting hardship is often the consequence of the bargain rather than a failure of law. Former Attorney General K.K. Venugopal cautioned, in a widely cited 2017 article in The Hindu, that the Supreme Court, in pursuing justice for the parties before it, can sometimes overlook the wider effect of its orders on people who are not before the court. That caution applies with particular force to commercial matters, where an order under Article 142 in one dispute can alter expectations across an entire body of contracting parties.
The Arbitration and Conciliation Act, 1996: A Statute Built on Minimal Interference
The Arbitration and Conciliation Act, 1996 is built around party autonomy, minimal judicial interference, and the finality of awards. Section 5 bars judicial intervention in matters governed by Part I of the Act except where the Act itself provides for it. Section 35 goes further and states directly that, subject to Part I, an arbitral award is final and binding on the parties and persons claiming under them. Section 34 supplies the only route for challenging an award, and it is not an appeal, it does not permit a rehearing on facts, and a court cannot substitute its own view merely because another view is available. The grounds for a Section 34 challenge are narrow and exhaustively listed.
Section 34 and the McDermott-NHAI Line of Authority
Before the recent controversy over whether Section 34 courts can modify an award, the position was shaped by two decisions. In McDermott International Inc. v. Burn Standard Co. Ltd., (2006) 11 SCC 181, the Supreme Court held that a court exercising Section 34 jurisdiction can set aside an award but cannot correct the arbitrator’s errors; if the parties wish to proceed further after an award is set aside, the remedy is a fresh arbitration. This position was carried forward in The Project Director National Highways v. M. Hakeem, (2021) 9 SCC 1, where the Court held that Section 34 confers no power to modify an award, because a limited statutory remedy must operate strictly within the boundaries the statute sets.
The logic behind both rulings is straightforward. A Section 34 court does not ask whether the arbitrator reached the most commercially sensible outcome, it asks only whether the award suffers from the specific defects the statute recognises. Once courts begin correcting or reshaping awards as a matter of routine, arbitration stops functioning as a final, self-contained process and instead becomes the first stage of a longer court battle, defeating the purpose for which parties chose it.
DMRC Ltd. v. Delhi Airport Metro Express: Curative Jurisdiction and a ₹7,500-Crore Award
In the DMRC case, an arbitral tribunal awarded the concessionaire a sum close to INR 7,500 crores. A Single Judge upheld the award, a Division Bench interfered only partially, the Supreme Court restored the award under Article 136 of the Constitution, and a review petition was dismissed. The Supreme Court then admitted a curative petition and set aside the award, holding that the tribunal had made a fundamental error by treating steps taken to cure certain defects as though the defects had actually been cured.
The difficulty is not the outcome in isolation, it is that a concluded arbitral award was reopened after the Section 34 and Section 37 process, a special leave petition, and a review had all concluded, on a question closely tied to contractual interpretation. Curative jurisdiction, as explained in Rupa Ashok Hurra v. Ashok Hurra, (2002) 4 SCC 388, is reserved for the rarest cases, such as a gross violation of natural justice or a demonstrable apprehension of bias. Using curative jurisdiction in a commercial arbitration dispute to revisit the tribunal’s underlying reasoning, after every ordinary remedy has been exhausted, weakens the assurance that an award becomes final once the statutory process under the Arbitration Act has run its course.
Gayatri Balasamy v. ISG Novasoft Technologies: Defining a Limited Power to Modify
The Gayatri Balasamy ruling is the Supreme Court’s most detailed attempt to settle whether a court can modify an arbitral award after it has been made. The Constitution Bench accepted that an absolute bar on modification could, in some situations, cause unnecessary delay and hardship, if a defect is narrow, obvious, and correctable without reopening the merits, setting aside the entire award and sending the parties back into arbitration may serve little practical purpose.
At the same time, the Court did not turn Section 34 of the Arbitration Act into an appellate remedy. The power recognised by the majority is confined to four situations: severing an invalid part of an award from a valid part; correcting clerical, computational, or manifest errors that are apparent on the face of the record; adjusting post-award interest in an appropriate case; and, with caution, invoking Article 142 to bring finality to the dispute. The ruling does not authorise a court to revisit the merits of an award merely because the outcome seems harsh or commercially inconvenient correction is permitted only where a court can act without reappreciating evidence, reinterpreting contractual terms, or substituting its own commercial judgment for that of the tribunal.
The Dissent of Justice K.V. Viswanathan
Justice K.V. Viswanathan’s dissent identifies the risk inherent in recognising even a limited power to modify an award. In his view, the power to set aside an award and the power to modify it are fundamentally different in character, and Article 142 cannot be used to bypass the statutory scheme built into the Arbitration Act. Notably, the majority itself acknowledged a version of this concern, cautioning that Article 142 must not be used to rewrite an award or alter it on merits.
Bhupesh Bhayana v. Kunal Seth: Article 142 as a Closing Mechanism
Bhupesh Bhayana shows how the Gayatri Balasamy framework plays out in a concrete commercial dispute. The case arose from a reconstruction agreement under which the builder was found to be in breach. The arbitral tribunal awarded a delay penalty to the owners but declined a separate forfeiture claim, holding that both reliefs could not be granted together. In Section 34 proceedings, the Single Judge altered the period for which the penalty was payable. The Division Bench held that this modification exceeded the scope of Section 34, but then went on to deny damages to the owners altogether for lack of proof of actual loss.
The Supreme Court restored the contractual basis of the claim, holding that where an agreement itself fixes a per-day amount payable for delay, the owners are not required to separately prove actual loss. The Court confined the penalty to the period that was contractually sustainable and adjusted it against the builder’s own entitlement, a narrow correction based entirely on the existing record, without requiring fresh evidence or a broader reassessment of the merits. Article 142 was invoked at the final stage to close the matter rather than send the parties into another round of proceedings, given that the dispute had been litigated since 2012.
Read narrowly, Bhupesh Bhayana supports the use of Article 142 only where the correction is limited, the figures can be worked out from the existing record, and a remand would serve no genuine purpose. It should not be read as authority for the proposition that long pendency, by itself, justifies modifying an arbitral award in a commercial dispute.
How Other Jurisdictions Protect Arbitral Finality
A comparative look at other arbitration regimes reinforces the case for restraint. Under English arbitration law, challenges are confined to a want of substantive jurisdiction, serious procedural irregularity, and a narrow appeal on a point of law that parties may exclude by agreement. In Lesotho Highlands Development Authority v. Impregilo SpA, (2005) 3 WLR 129 : 2005 UKHL 43, the House of Lords held that courts must intervene only where the statutory conditions for intervention are actually satisfied. Singapore, following the UNCITRAL Model Law, restricts annulment to the specific grounds recognised under Article 34 of the Model Law.
In the United States, judicial review is confined by the Federal Arbitration Act, and in Hall Street Associates, LLC v. Mattel, Inc., 552 US 576 (2008), the U.S. Supreme Court held that parties cannot contractually expand the statutory scope of federal judicial review beyond what the Federal Arbitration Act permits. France and Switzerland similarly proceed on limited annulment grounds, directed principally at jurisdiction, due process, and public policy. Across these systems, the common thread is that arbitral finality is protected by confining judicial review to defined statutory limits, none of them recognises a general equitable power to reopen or alter an award simply because the result seems harsh or the dispute has run for years.
Principles for Restrained Use of Article 142 in Commercial Disputes
Article 142 continues to apply in commercial disputes; the Constitution does not carve out an exception for them. The real question is not whether the power exists but when it should be used. A workable set of limits emerges from the three recent rulings.
The first is fidelity to the statute. Where the legislature has built a complete remedial framework around limited judicial interference as it has with the Arbitration Act, Article 142 should not be used to manufacture a remedy the statute itself withholds. Limited court supervision is not a technical detail of the Act; it is part of the commercial bargain parties accept when they choose arbitration.
The second is deference to party autonomy. Commercial parties accept risks and remedies with full knowledge of the consequences. A difficult outcome that follows from those choices is not automatically a failure of justice, and Article 142 should not become a jurisdiction for relieving parties of the consequences of arrangements they voluntarily entered into.
The third is a firm boundary against merits review. Article 142 should not be used to reappreciate evidence, reinterpret contractual clauses, reassess damages, or substitute the Court’s own commercial judgment for that of the arbitral tribunal. Intervention should be confined to corrections that are narrow, obvious, and possible on the existing record, the Court should not use Article 142 to achieve what Sections 34 and 37 of the Arbitration Act do not permit.
The fourth concerns delay. Delay may influence how relief is shaped, but it cannot become the foundation for exercising the power itself. Most commercial disputes that reach the Supreme Court have already taken years to get there; if delay alone justified intervention under Article 142, the exception would quickly become routine, and statutory finality would give way to case-by-case appeals to equity.
The fifth is candour. Whenever Article 142 is invoked in a commercial matter, the Supreme Court should identify the precise injustice, explain why the ordinary statutory framework under the Arbitration Act is insufficient, and ensure that the relief granted does not disturb the statute, the underlying bargain, or the finality of the award. Without this discipline, individual orders can gradually harden into a general equitable jurisdiction over commercial outcomes exactly the drift that Gayatri Balasamy and Bhupesh Bhayana attempt to guard against.
Conclusion: Certainty Is the Currency of Commercial Arbitration
DMRC, Gayatri Balasamy, and Bhupesh Bhayana are not three unrelated rulings, they are three attempts, at different points on the same spectrum, to answer how far a court may go in correcting an arbitral award before supervision becomes appeal. Article 142 does its most valuable work where ordinary law cannot respond to injustice. In commercial disputes, ordinary law is usually the very framework the parties chose when they signed an arbitration clause governed by the Arbitration and Conciliation Act, 1996. Commercial justice is not achieved merely by producing a fair result for the parties standing before the Court on a given day, it requires predictability, respect for contractual choices, and confidence that the statutory limits set by Sections 5, 34, 35, and 37 of the Arbitration Act will be honoured in the next case as much as this one. The power capable of doing the most immediate good in an individual dispute must, for that reason, be used with the greatest restraint in the field of law that depends most on certainty.
The principle of arbitral finality highlighted in Supreme Court Bars Fresh Arbitration After Withdrawal is closely connected to the limits of judicial intervention and the Supreme Court’s powers under Article 142 in reviewing arbitral awards.
