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Date: 01.05.2025
Supreme Court Constitution Bench Affirms Limited Court Power to Modify Arbitral Awards Under Section 34 of Arbitration Act based on Severability Doctrine
In a landmark Constitution Bench judgment dated 30 April 2025 (Gayatri Balasamy vs. ISG Novasoft Technologies Ltd., 2025 INSC 605), the Supreme Court of India has decisively held that Indian courts possess a limited power to modify arbitral awards under Section 34 of the Arbitration and Conciliation Act, 1996.
Key Takeaways from the Judgment:
1. Recognition of Limited Modification Power
The court affirmed that while Section 34 does not explicitly provide for modification, courts can:
- Modify an award if the invalid portion is severable from the valid portion.
- Correct clerical, typographical, or computational errors.
- Adjust post-award interest, as prescribed under Section 31(7)(b).
- Exercise modification under Article 142 of the Constitution in rare cases to do complete justice.
This Article has been written by Shri Ravi Shekhar Jha, Advocate Delhi High Court based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.
Source: Supreme Court
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