Section 34 Court – Obligation to consider the grounds and record findings

Two Tie Up Agreements dated 24.03.2004 and 30.04.2004 were executed for NAFED to extend finance to REPL for 80% of value of stock procured by REPL and 20% to be procured by NAFED.

NAFED invoked arbitration by the letter dated 17.3.2008 to resolve the disputes.

The sole Arbitrator by the Award dated 12.2.2019 dismissed the claim of NAFED against respondent no.1. 

The counter claim of REPL for Rs.33,97,77,369/- with interest was allowed.

It was held that the claim against respondent nos.2 and 3 is not maintainable since they are not parties to arbitration agreement.

Section 34 petition of NAFED was dismissed by the District Judge vide impugned judgment dated 22.4.2024.

HELD that NAFED, in its grounds of challenge under section 34 as well written notes of arguments had specifically assailed the award on various counts.  Though the District Judge noted some of the grounds of challenge in the impugned judgment, there has been no adjudication of the grounds raised by NAFED.   Merely stating the scope of section 34 interference is limited and re-appreciation of evidence was not permissible, the challenge was turned down.

In our view, it was necessary for the learned District Judge to have considered the grounds of challenge and recorded findings either accepting or rejecting such grounds.   Such exercise is within the permissible limits of section 34(2) of the AA.

Judgment dated 7.3.2025 of the High Court of Bombay in Commercial Arbitration Appeal No.15 of 2024 (AS) of National Agricultural Cooperative Marketing Federation of India Ltd   Vs.   Roj Enterprises (P) Limited and others