M/S ALPINE HOUSING DEVELOPMENT CORPORATION PVT. LTD.versusASHOK S DHARIWAL AND OTHERS

                          [2023] 1 S.C.R. 991                            991


  M/S ALPINE HOUSING DEVELOPMENT CORPORATION                             A
                    PVT. LTD.
                                  v.
              ASHOK S DHARIWAL AND OTHERS
                    (Civil Appeal No. 73 of 2023)                        B
                        JANUARY 19, 2023
         [M. R. SHAH AND C. T. RAVIKUMAR, JJ.]
       Arbitration & Conciliation Act, 1996 – s.34(2)(a) – Prior and
post 2019 Amendment – Whether the applicant can be permitted to
                                                                         C
adduce evidence to support the ground relating to Public Policy in
an application filed u/s. 34 of the Arbitration & Conciliation Act,
1996 – Held: In the instant case, the arbitration proceedings
commenced and even the award was declared prior to the amendment
of s.34(2)(a) by Act 33/2019, so s.34(2)(a) pre-amendment shall be
applicable – In s.34(2)(a) pre-amendment, an arbitral award could        D
be set aside by the Court if the party making application “furnishes
proof” – An application for setting aside the arbitral award will not
ordinarily require anything beyond the record that was before the
arbitrator, however, if there are matters not containing such records
and the relevant determination to the issues arising u/s. 34(2)(a),
they may be brought to the notice of the Court by way of affidavits      E
filed by both the parties’ the cross-examination of the persons
swearing in to the affidavits should not be allowed unless absolutely
necessary as the truth will emerge on the reading of the affidavits
filed by both the parties – Respondent permitted to file affidavits/
additional evidence in the proceedings u/s.34 of the Arbitration
                                                                         F
Act.
       Arbitration & Conciliation Act, 1996 : s. 34(2)(b) – When an
award passed could be set aside on the ground of its being in conflict
with the “Public Policy of India” – Scope – The ground that arbitral
award is in conflict with the Public Policy of India, the said ground
could be available only after passing of the award – Therefore, the      G
same can be permitted to be agitated in an application u/s 34 and
the person shall not have to wait till the execution is filed – The
defence that the arbitral award is in conflict with the Public Policy
of India itself can be a ground to set aside the award in view of
section 34(2)(b) of the Act.                                             H
                                991
992            SUPREME COURT REPORTS                       [2023] 1 S.C.R.


A           Dismissing the appeal, the Court
            HELD : 1. The arbitration proceedings commenced and
      even the award was declared prior to the amendment of Section
      34(2)(a) by Act 33/2019, Section 34(2)(a) pre-amendment shall
      be applicable. Prior to the amendment of section 34(2)(a), an
B     arbitral award could be set aside by the Court if the party making
      an application “furnishes proof” and the grounds set out in
      section 34(2)(a) and section 34(2)(b) are satisfied. However,
      subsequent to the amendment of section 34(2)(a), the words
      “furnishes proof” have been substituted by the words
      “establishes on the basis of the record of the arbitral tribunal”.
C     In that view of the matter, it is held that in case of arbitration
      proceedings commenced and concluded prior to the amendment
      of section 34(2)(a) by Act 33/2019, pre-amendment of section
      34(2)(a) shall be applicable. [Para 6][1000-F-H]
             2. The scope and ambit of section 34(2)(a) pre-amendment
D     would be that applications under sections 34 of the Act are
      summary proceedings; an award can be set aside only on the
      grounds set out in section 34(2)(a) and section 34(2) (b); speedy
      resolution of the arbitral disputes has been the reason for
      enactment of 1996 Act and continues to be a reason for adding
E     amendments to the said Act to strengthen the aforesaid object;
      therefore in the proceedings under section 34 of the Arbitration
      Act, the issues are not required to be framed, otherwise if the
      issues are to be framed and oral evidence is taken in a summary
      proceedings, the said object will be defeated; an application for
      setting aside the arbitral award will not ordinarily require anything
F     beyond the record that was before the arbitrator, however, if there
      are matters not containing such records and the relevant
      determination to the issues arising under section 34(2)(a), they
      may be brought to the notice of the Court by way of affidavits
      filed by both the parties’ the cross-examination of the persons
G     swearing in to the affidavits should not be allowed unless
      absolutely necessary as the truth will emerge on the reading of
      the affidavits filed by both the parties. Therefore, in an exceptional
      case being made out and if it is brought to the court on the matters
      not containing the record of the arbitrator that certain things are
      relevant to the determination of the issues arising under section
H
  M/S ALPINE HOUSING DEVELOPMENT CORPORATION                             993
           PVT. LTD. v. ASHOK S. DHARIWAL

34(2)(a), then the party who has assailed the award on the grounds       A
set out in section 34(2)(a) can be permitted to file affidavit in the
form of evidence. However, the same shall be allowed unless
absolutely necessary. [Para 8][1005-H; 1006-A-E]
      3. It is required to be noted that even for establishing that
the arbitral award is in conflict with Public Policy of India, in a      B
given case, the evidence may have to be led and by leading
evidence, the person who is challenging the award on that ground
can establish and prove that the arbitral award is in conflict with
Public Policy of India and/or the subject matter of dispute is not
capable of settlement by arbitration under the law for the time
being in force. However, at the same time, from the record before        C
the arbitrator, if the same can be established and proved that the
subject matter of the dispute is not capable of settlement by
arbitration under the law for the time being in force or the arbitral
award is in conflict with the Public Policy of India, in that case,
the person may not be permitted to file the affidavit by way of          D
evidence/additional evidence. [Para 9][1006G-H; 1007-A-B]
       4. It is required to be noted that so far as one of the grounds
set out in section 34(2)(b), namely, that the arbitral award is in
conflict with the Public Policy of India, the said ground could be
available only after passing of the award. Therefore, the same           E
can be permitted to be agitated in an application under section
34 of the Act and the person shall not have to wait till the execution
is filed. The defence that the arbitral award is in conflict with the
Public Policy of India itself can be a ground to set aside the award
in view of section 34(2)(b) of the Act.[Para 10] [1007-C-D]
                                                                         F
      Fiza Developers and Inter-Trade Private Limited v.
      AMCI (India) Private Limited & Another, (2009) 17 SCC
      796 : [2009] 12 SCR 1; Canara Nidhi Limited v. M.
      Shashikala (2019) 9 SCC 462 : [2019] 15 SCR 637;
      Emkay Global Financial Services Limited v. Girdhar
      Sondhi, (2018) 9 SCC 49 : [2018] 10 SCR 937 -                      G
      referred to.
                       Case Law Reference
[2009] 12 SCR 1          referred to            Para 2.2,
[2019] 15 SCR 637        referred to            Para 7(iii)              H
994              SUPREME COURT REPORTS                         [2023] 1 S.C.R.


A     [2018] 10 SCR 937          referred to              Para 7(iii)
               CIVIL APPELLATE JURISDICTION : Civil Appeal No.73 of
      2023.
             From the Judgment and Order dated 01.09.2021 of the High Court
      of Judicature of Karnataka at Bangalore in W.P. No.50799 of 2019(GM/
B     CPC).
           Krishnan Venugopal, Sr. Adv., Ms. Shobha Gupta, Ms. Sanskriti
      Gupta, Krishnan Agarwal, M. C. Dhingra, Advs. for the Appellant.
           Balaji Srinivasan, Ms. Lakshmi Rao, Ms. Aakriti Priya, Abdul
C     Saleem, Advs. for the Respondents.
               The Judgment of the Court was delivered by
               M. R. SHAH, J.
            1. Feeling aggrieved and dissatisfied with the impugned judgment
      and order dated 1.9.2021 passed by the High Court of Karnataka at
D
      Bengaluru in Writ Petition No. 50799/2019, by which the High Court has
      allowed the said writ petition and while quashing and setting aside the
      order passed by the learned Additional City Civil and Sessions Judge,
      Bengaluru, has permitted the respondents – original writ petitioners to
      adduce evidence in an application under Section 34 of the Arbitration &
E     Conciliation Act, 1996 (hereinafter referred to as the ‘Act’), the original
      respondent before the High Court and in whose favour the award has
      been passed by the learned Arbitral Tribunal has preferred the present
      appeal.
               2. The facts leading to the present appeal in a nutshell are as
F     under:
             That against the award passed by the learned arbitrators dated
      12.03.1998, an application under Section 34 of the Act being Arbitration
      Case No. 38/1998 has been filed by the respondents. That the respondents
      filed an interim application being IA No. 4 in section 34 application to
G     adduce additional evidence. At this stage, it is required to be noted that
      as such the award passed by the learned arbitrators was an ex-parte
      award and no evidence was led by the respondents herein, who
      subsequently assailed the award by way of section 34 application. The
      appellant herein filed objections to the said interim application seeking
      permission to adduce evidence on the ground that the same was not
H
   M/S ALPINE HOUSING DEVELOPMENT CORPORATION                                   995
     PVT. LTD. v. ASHOK S. DHARIWAL [M. R. SHAH, J.]

maintainable in accordance with the provisions of the Arbitration Act,          A
1996. The grounds on which the respondents submitted an application to
permit them to adduce evidence shall be dealt with and considered
hereinafter.
       2.1 The Court dealing with interim application being IA No. 4 in
section 34 application rejected the said interim application and refused        B
to permit the respondents to adduce evidence by observing that if such a
permission is granted, it would defeat the object and purpose of early
disposal of arbitration proceedings and it would delay further hearing of
section 34 application. For that purpose, reliance was placed on the
provisions of Section 34(2)(a) of the Act, as amended in the year 2019,
by which expression “furnish proof” in section 34(2)(a) came to be              C
substituted with the expression “establish on the basis of record of arbitral
tribunal”. Therefore, the Court dealing with section 34 application opined
that the said amendment intended to limit the scope of judicial review
under Section 34 of the Act only in exceptional circumstances enumerated
under Section 34(2)(a) of the Act on the basis of the record available          D
and even if the grounds urged relate to section 34(2)(b) of the Act, the
applicants cannot have a right to produce additional evidence. The order
passed by the Court dealing with Section 34 application which rejected
the interim application being IA No. 4 preferred by the respondents
permitting them to adduce additional evidence/evidence was the subject
matter of writ petition before the High Court.                                  E

       2.2 Before the High Court, it was conceded on behalf of the
appellant herein – original respondent before the High Court, so recorded
in paragraph 8 of the impugned judgment, that the provisions of Section
34 (2)(a) of the Act, as it stood prior to Act 33 of 2019 would apply,
namely, pre-amendment to section 34(2)(a) of the Act shall be applicable.       F
That thereafter, by the impugned judgment and order, after following the
decision of this Court in the case of Fiza Developers and Inter-Trade
Private Limited v. AMCI (India) Private Limited & Another, reported
in (2009) 17 SCC 796, the High Court has allowed the said writ petition
and set aside the order passed by the court below and has allowed the           G
application preferred by the respondents herein permitting them to adduce
evidence in the proceedings under section 34 of the Act. The impugned
judgment and order passed by the High Court permitting him respondents
to adduce evidence/additional evidence in the proceedings under Section
34 of the Act is the subject matter of present appeal before this Court.
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996             SUPREME COURT REPORTS                           [2023] 1 S.C.R.


A            3. Shri Krishnan Venugopal, learned Senior Advocate has
      appeared on behalf of the appellant and Shri Balaji Srinivasan, learned
      Advocate has appeared on behalf of the respondents – original writ
      petitioners.
             3.1 Shri Krishnan Venugopal, learned senior counsel appearing
B     on behalf of the appellant has vehemently submitted that in the facts and
      circumstances of the case, the High Court has committed a very serious
      error in permitting the respondents to adduce evidence in an application
      under section 34 of the Act. It is submitted that the impugned judgment
      and order passed by the High Court permitting the respondents to adduce
      additional evidence in an application under section 34 of the Act is against
C     the object and purpose of the amending section 34(2)(a), amended vide
      Act No. 33/2019. It is submitted that if in an application under section 34
      of the Act, the applicant who is aggrieved by the award passed by the
      arbitral tribunal is permitted to adduce evidence, it would defeat the
      object and purpose of amending section 34(2)(a) of the Act by which
D     the expression “furnishes proof” has been substituted with the expression
      “establish on the basis of record of the arbitral tribunal”. It is submitted
      that the object and purpose of amending section 34(2)(a) of the Act is to
      decide and dispose of the arbitration proceedings at the earliest and to
      avoid delay.
E            3.2 It is further submitted by Shri Krishnan Venugopal, learned
      senior counsel appearing on behalf of the appellant that though it was
      conceded before the High Court by the counsel appearing on behalf of
      the appellant that section 34 of the Act prior to amendment amending
      section 34(2)(a) shall be applicable, the said concession is not binding as
      the same would be against the law and any concession contrary to law
F     shall not be binding. It is submitted that therefore according to him the
      provisions of section 34(2)(a) post amendment shall be applicable by
      which in the proceedings under section 34 of the Act, the applicant is not
      required to furnish proof on the grounds set out in section 34 (2)(a) to set
      aside the award and the court dealing with section 34 application has to
G     decide the same only on exceptional circumstances enumerated under
      section 34(2)(a) of the Act on the basis of the record available. It is
      submitted that therefore the applicants cannot have a right to produce
      additional evidence/evidence.
            3.3 It is further submitted that even otherwise and assuming that
H     the provisions applicable prior to amendment (Act 33 of 2019) are
   M/S ALPINE HOUSING DEVELOPMENT CORPORATION                                    997
     PVT. LTD. v. ASHOK S. DHARIWAL [M. R. SHAH, J.]

applicable, in that case also, as the respondents – original applicants          A
have assailed the award on the grounds enumerated under section 34(2)
(b) of the Act, the expression “furnish proof” in section 34(2)(a) cannot
apply to section 34(2)(b). It is submitted that the award passed by the
arbitral tribunal can be assailed either on the grounds enumerated under
section 34(2)(a) or under section 34(2)(b). It is submitted that the grounds
                                                                                 B
enumerated under section 34(2)(a) and section 34(2)(b) are separate
grounds/clauses. It is submitted that therefore “furnish proof” in section
34(2)(a) of the Act cannot apply to section 34(2)(b) because if the
Parliament intended so, Section 34(2) would have applied the proof
requirement to all seven grounds, without any need for separate clauses
(a) and (b). It is submitted that the effect of “the court finds that” in        C
section 34(2)(b) is that the court can on its own decide based on the
arbitral award that the dispute was not arbitrable or that award conflicts
with public policy. It is submitted that therefore, the disjunctive “or”
between clauses (a) and (b) of section 34(2) cannot be read as the
conjunctive “and”.
                                                                                 D
       3.4 It is further submitted that the ratio of this Court in the case of
Fiza Developers(supra) was for framing of issues which is not required
in section 34(2) proceedings. It is submitted that in the case of Emkay
Global Financial Services Limited v. Girdhar Sondhi, reported in
(2018) 9 SCC 49, this Court has explained the decision in the case of
Fiza Developers (supra) and has expressly held that only section 34(2)           E
(a) contemplates furnishing proof. It is submitted that the subsequent
decision of this Court in the case of Canara Nidhi Limited v. M.
Shashikala, reported in (2019) 9 SCC 462 has approved the
interpretation of section 34(2)(a) in Emkay Global (supra).
       3.5 It is further submitted that in the case of Gemini Bay                F
Transcription Private Limited v. Integrated Sales Service Limited,
reported in (2022) 1 SCC 753, this Court has treated 2019 amendment
to section 34(2)(a) as clarificatory, while considering section 48(1) which
are broadly in pari materia with section 34(2)(a) and 34(2)(b) as they
stood prior to the 2019 amendment. It is submitted that this Court in the        G
aforesaid decision in paragraphs 39 & 40 held that grounds under
unamended section 48 including conflict with public policy in section
48(2) are to be established only on basis of “record of arbitral tribunal”
in the interest of speedy enforcement of foreign award.

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998             SUPREME COURT REPORTS                              [2023] 1 S.C.R.


A             3.6 It is submitted that as such there is no legal bar to the Parliament
      to provide two different procedures for two different sets of grounds in
      a proceeding or even having two different procedures for the same relief.
      It is submitted that the Parliament intended that grounds in section 34(2)
      (b) must be established on the basis of the record of the arbitral tribunal.
      It is submitted that even assuming proof is required under section 34(2)
B
      (b), it does not apply to a case of alleged conflict of an award with
      statute. Being a pure question of law, it can be considered on the findings/
      directions recorded in the award.
             3.7 It is further submitted that even otherwise on merits also,
      general rule is that unless exceptional circumstances are made out, no
C     additional evidence is permissible. It is submitted that the present case
      does not fall within the meaning of “exceptional circumstances” as held
      by this Court in the case of Canara Nidhi (supra). It is submitted that
      the directions in the award that the parties shall apply for statutory
      permissions is the legally correct decree to pass in a suit for specific
D     performance. Therefore, the award cannot be said to be in conflict with
      “public policy of Indian law.”
              3.8 It is submitted that the respondents’ contention that the award
      is frustrated because corporation refused permission for clubbing of khatas
      which is the basis for award to be executed does not fall within the
E     conflict with public policy ground under section 34(2)(b) because it is
      the award and not its execution that must conflict with the public policy
      of India. It is submitted that apart from the fact that the respondents
      contention is premised on his having accepted the award, the corporation’s
      alleged refusal is admittedly a subsequent event after the award. It is
      submitted that it is the executing court that would determine that the
F     decree is inexecutable due to change in circumstances. It is submitted
      that the evidence can be led during execution. It is submitted that the
      respondents are bound to suffer the consequence of their wilful failure
      to participate in the arbitration proceedings before the arbitral tribunal,
      despite attending them after the rejection of their objection to the
G     jurisdiction of the Tribunal. It is submitted that therefore the respondents
      cannot be allowed to lead evidence by taking advantage of their own
      wrong.
             3.9 It is further urged by the learned senior counsel appearing on
      behalf of the appellant that if this Court is inclined to allow the respondents
H     to lead evidence, in that case, (a) the appellant may be permitted to lead
   M/S ALPINE HOUSING DEVELOPMENT CORPORATION                                   999
     PVT. LTD. v. ASHOK S. DHARIWAL [M. R. SHAH, J.]

evidence including the permission for clubbing khatas where there are           A
nalas and the corporation’s later endorsement dated 28.6.2004 agreeing
to consider clubbing of khatas concealed by the respondents, and (b) the
questions of law regarding whether the corporation’s refusal falls under
section 34(2)(b) may kindly be left open.
        4. The present appeal is vehemently opposed by Shri Balaji              B
Srinivasan, learned counsel appearing on behalf of the respondents. It is
submitted that in the present case initially the respondents challenged
the arbitration proceedings/constitution of the arbitral tribunal and
therefore did not participate in the arbitration proceedings. It is submitted
that thereafter the arbitral tribunal proceeded with the hearing ex-parte.
It is submitted that therefore as such no evidence was adduced or led by        C
the respondents before the arbitral tribunal.
       4.1 It is submitted that in the present case the arbitration
proceedings begun on 7.2.1997 under old Arbitration Act, 1940 and on
25.03.1997 arbitrators arbitrarily decided to proceed with the arbitration
proceedings under the Arbitration Act, 1996. It is submitted that the           D
respondents withdrew from the arbitration. That thereafter the
respondents filed an application challenging the bias and higher fees
before the arbitral tribunal. However, ex-parte award dated 12.03.1998
came to be passed for specific performance of the agreement reserving
liberty to apply for amalgamation of khatas. It is submitted that in fact       E
though it was for the appellant to apply for amalgamation of khatas but
it did not and it was the respondents who applied for the same twice. It
is submitted that applications for amalgamation of khatas made by
respondents twice have been rejected due to presence of RzajaKaluve
or rain water drain. It is submitted that therefore the respondents made
an application to produce the evidence in section 34 application to produce     F
the final endorsement dated 17.03.2003 by which the prayer for
amalgamation of khatas to plots were rejected and thereafter it is required
to examine the concerned officer. It is submitted that therefore it is the
case on behalf of the respondents that the award is incapable of being
implemented and/or executed in view of section 34(2)(b) (i) & (ii) of the       G
Arbitration Act, 1996 and section 56 of the Indian Contract Act. It is
submitted that therefore according to the respondents the enforcement
of the award is contrary to Public Policy, Local Law & void arbitration
proceedings further leading to Section 56 of the Indian Contract Act.

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1000             SUPREME COURT REPORTS                            [2023] 1 S.C.R.


 A             4.2 It is submitted that as such in the present case the provisions
       prior to the amendment to section 34(2)(a) of the Act, i.e., prior to Act
       33/2019 shall be applicable in which the words used are “furnish proof”.
       It is submitted that as such the words “ furnish proof” shall be applicable
       with respect to an application to set aside the award on the grounds set
       out in section 34(2)(a) & 34(2)(b) and not section 34(2)(a) alone, as
 B
       sought to be contended on behalf of the appellant.
               4.3 Learned counsel appearing on behalf of the respondents has
       heavily relied upon the decisions of this Court in the cases of Fiza
       Developers (supra); Emkay Global (supra); and Canara Nidhi
       (supra). He has also relied upon the decision of this Court in the case of
 C     S.P. Singla Constructions Pvt. Ltd. v. State of Himachal Pradesh,
       reported in (2019) 2 SCC 488 in support of his submission that the
       amending arbitration Act shall not be applicable with respect to arbitration
       proceedings commenced before the commencement of the amending
       act, unless the parties otherwise agree.
 D             4.4 Making above submissions, it is prayed to dismiss the present
       appeal.
               5. We have heard learned counsel for the respective parties at
       length.
               6. The short question which is posed for the consideration of this
 E     Court is, whether the applicant can be permitted to adduce evidence to
       support the ground relating to Public Policy in an application filed under
       Section 34 of the Arbitration & Conciliation Act, 1996?
               At the outset, it is required to be noted that in the present case the
       arbitration proceedings commenced and even the award was declared/
 F     passed by the arbitral tribunal in the year 1998, i.e., prior to section
       34(2)(a) came to be amended vide Act 33/2019. Apart from the fact
       that it was conceded by the learned counsel appearing on behalf of the
       appellant before the High Court that the law prevailing prior to the
       amendment of Section 34(2)(a) by Act 33/2019 shall be applicable, even
       otherwise, we are of the opinion that the arbitration proceedings
 G     commenced and even the award was declared prior to the amendment
       of Section 34(2)(a) by Act 33/2019, Section 34(2)(a) pre-amendment
       shall be applicable. The view which we are taking is because by
       amendment of section 34(2)(a) by Act 33/2019, there is a substantial
       change. Prior to the amendment of section 34(2)(a), an arbitral award
       could be set aside by the Court if the party making an application “furnishes
 H
   M/S ALPINE HOUSING DEVELOPMENT CORPORATION                                    1001
     PVT. LTD. v. ASHOK S. DHARIWAL [M. R. SHAH, J.]

proof” and the grounds set out in section 34(2)(a) and section 34(2)(b)          A
are satisfied. However, subsequent to the amendment of section 34(2)(a),
the words “furnishes proof” have been substituted by the words
“establishes on the basis of the record of the arbitral tribunal”. In that
view of the matter, we hold that in case of arbitration proceedings
commenced and concluded prior to the amendment of section 34(2)(a)
                                                                                 B
by Act 33/2019, pre-amendment of section 34(2)(a) shall be applicable.
       7. Now so far as the question, whether in an application filed
under section 34(2)(a) pre-amendment where the requirement is that
the party making an application has to “furnish proof”, whether such an
applicant can be permitted to adduce evidence by way of affidavit or
otherwise is concerned, few decisions of this Court are required to be           C
referred to.
      (i) In the case of Fiza Developers (supra), the question that was
      posed by the Court was, whether issues as contemplated under
      Order 14 Rule 1 CPC should be framed in applications under
      Section 34 of the Act. Answering the same, this Court observed             D
      and held in paragraphs 14, 17, 18, 21, 22, 24, 29 & 31 as under:
          “14. In a summary proceeding, the respondent is given an
          opportunity to file his objections or written statement.
          Thereafter, the court will permit the parties to file affidavits in
          proof of their respective stands, and if necessary permit cross-       E
          examination by the other side, before hearing arguments.
          Framing of issues in such proceedings is not necessary. We
          hasten to add that when it is said issues are not necessary, it
          does not mean that evidence is not necessary.
                                      XXXXXX                                     F
          17. The scheme and provisions of the Act disclose two
          significant aspects relating to courts vis-à-vis arbitration. The
          first is that there should be minimal interference by courts in
          matters relating to arbitration. Second is the sense of urgency
          shown with reference to arbitration matters brought to court,          G
          requiring promptness in disposal.
          18. Section 5 of the Act provides that notwithstanding anything
          contained in any other law for the time being in force, in matters
          governed by Part I of the Act, no judicial authority shall intervene
          except where so provided in the Act.                                   H
1002   SUPREME COURT REPORTS                           [2023] 1 S.C.R.


 A                               XXXXXXX
       21. We may therefore examine the question for consideration
       by bearing three factors in mind. The first is that the Act is a
       special enactment and Section 34 provides for a special
       remedy. The second is that an arbitration award can be set
 B     aside only upon one of the grounds mentioned in sub- section
       (2) of Section 34 exists. The third is that proceedings under
       Section 34 requires to be dealt with expeditiously.
       22. The scope of enquiry in a proceeding under Section 34 is
       restricted to consideration whether any one of the grounds
 C     mentioned in sub-section (2) of Section 34 exists for setting
       aside the award. We may approvingly extract the analysis
       relating to “grounds of challenge” from The Law & Practice
       of Arbitration and Conciliation by Shri O.P. Malhotra [1st
       Edn., p. 768, Para (I) 34-14]:
          “Section 5 regulates court intervention in arbitral process.
 D
          It provides that notwithstanding anything contained in any
          other law for the time being in force in India, in matters
          governed by Part I of this Act, the court will not intervene
          except where so provided in this Part. Pursuant to this policy,
          Section 34 imposes certain restrictions on the right of the
 E        court to set aside an arbitral award. It provides, in all, seven
          grounds for setting aside an award. In other words, an
          arbitral award can be set aside only if one or more of these
          seven grounds exists.
          The first five grounds have been set forth in Section
 F        34(2)(a). In order to successfully invoke any of these
          grounds, a party has to plead and prove the existence of
          one or more of such grounds. That is to say, the party
          challenging the award has to discharge the burden of proof
          by adducing sufficient credible evidence to show the
          existence of any one of such grounds. The rest two grounds
 G        are contained in Section 34(2)
          (b) which provides that an award may be set aside by the
          court on its own initiative if the subject-matter of the dispute
          is not arbitrable or the impugned award is in conflict with
          the public policy of India.”
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M/S ALPINE HOUSING DEVELOPMENT CORPORATION                                     1003
  PVT. LTD. v. ASHOK S. DHARIWAL [M. R. SHAH, J.]

     The grounds for setting aside the award are specific. Therefore,          A
     necessarily a petitioner who files an application will have to
     plead the facts necessary to make out the ingredients of any
     of the grounds mentioned in sub-section (2) and prove the same.
     Therefore, the only question that arises in an application under
     Section 34 of the Act is whether the award requires to be set
                                                                               B
     aside on any of the specified grounds in sub-section (2) thereof.
     Sub-section (2) also clearly places the burden of proof on the
     person who makes the application. Therefore, the question
     arising for adjudication as also the person on whom the burden
     of proof is placed is statutorily specified. Therefore, the need
     for issues is obviated.                                                   C
                                XXXXXXXX


     24. In other words, an application under Section 34 of the Act
     is a single issue proceeding, where the very fact that the                D
     application has been instituted under that particular provision
     declares the issue involved. Any further exercise to frame issues
     will only delay the proceedings. It is thus clear that issues need
     not be framed in applications under Section 34 of the Act.
                                XXXXXXXX
                                                                               E
     29. In a regular civil suit, in the event of failure to file a defence,
     it will be lawful for the court to pronounce the judgment on the
     basis of facts contained in the plaint [vide Order 8 Rule 5(2) of
     the Code]. But in an application under Section 34, even if there
     is no contest, the court cannot, on the basis of the averments
                                                                               F
     contained in the application, set aside the award. Whether there
     is contest or not, the applicant has to prove one of the grounds
     set out in Sections 34(2)(a) and (b). Even if the applicant does
     not rely upon the grounds under clause (b), the court, on its
     own initiative, may examine the award to find out whether it is
     liable to be set aside on either of the two grounds mentioned in          G
     Section 34(2)(b). It is perhaps in this sense, the High Court
     has stated that the proceedings may not be adversarial. Be
     that as it may.
                                XXXXXXXX
                                                                               H
1004     SUPREME COURT REPORTS                             [2023] 1 S.C.R.


 A        31. Applications under Section 34 of the Act are summary
          proceedings with provision for objections by the respondent-
          defendant, followed by an opportunity to the applicant to
          “prove” the existence of any ground under Section 34(2). The
          applicant is permitted to file affidavits of his witnesses in proof.
          A corresponding opportunity is given to the respondent-
 B
          defendant to place his evidence by affidavit. Where the case
          so warrants, the court permits cross-examination of the persons
          swearing to the affidavit. Thereafter, the court hears arguments
          and/or receives written submissions and decides the matter.
          This is of course the routine procedure. The court may vary
 C        the said procedure, depending upon the facts of any particular
          case or the local rules. What is however clear is that framing
          of issues as contemplated under Rule 1 of Order 14 of the
          Code is not an integral part of the process of a proceedings
          under Section 34 of the Act.”
 D     (ii) The decision of this Court in the case of Fiza
       Developers(supra) has been subsequently considered by this
       Court in the case of Emkay Global (supra) and in paragraph 21,
       it is observed and held as under:
          “21. It will thus be seen that speedy resolution of arbitral
 E        disputes has been the reason for enacting the 1996 Act, and
          continues to be the reason for adding amendments to the said
          Act to strengthen the aforesaid object. Quite obviously, if issues
          are to be framed and oral evidence taken in a summary
          proceeding under Section 34, this object will be defeated. It is
          also on the cards that if Bill No. 100 of 2018 is passed, then
 F        evidence at the stage of a Section 34 application will be
          dispensed with altogether. Given the current state of the law,
          we are of the view that the two early Delhi High Court
          judgments [Sandeep Kumar v. Ashok Hans, 2004 SCC
          OnLine Del 106 : (2004) 3 Arb LR 306] , [Sial Bioenergie v.
 G        SBEC
          Systems, 2004 SCC OnLine Del 863 : AIR 2005 Del 95] , cited
          by us hereinabove, correctly reflect the position in law as to
          furnishing proof under Section 34(2)(a). So does the Calcutta
          High Court judgment [WEB Techniques & Net Solutions (P)
 H        Ltd. v. Gati Ltd., 2012 SCC OnLine Cal 4271] . We may hasten
   M/S ALPINE HOUSING DEVELOPMENT CORPORATION                                   1005
     PVT. LTD. v. ASHOK S. DHARIWAL [M. R. SHAH, J.]

         to add that if the procedure followed by the Punjab and Haryana        A
         High Court judgment [Punjab SIDC Ltd. v. Sunil K. Kansal,
         2012 SCC OnLine P&H 19641] is to be adhered to, the time-
         limit of one year would only be observed in most cases in the
         breach. We therefore overrule the said decision. We are
         constrained to observe that Fiza Developers [Fiza
                                                                                B
         Developers & Inter-Trade (P) Ltd. v. AMCI (India) (P) Ltd.,
         (2009) 17 SCC 796 : (2011) 2 SCC (Civ) 637] was a step in
         the right direction as its ultimate ratio is that issues need not be
         struck at the stage of hearing a Section 34 application, which
         is a summary procedure. However, this judgment must now
         be read in the light of the amendment made in Sections 34(5)           C
         and 34(6). So read, we clarify the legal position by stating that
         an application for setting aside an arbitral award will not
         ordinarily require anything beyond the record that was before
         the arbitrator. However, if there are matters not contained in
         such record, and are relevant to the determination of issues
                                                                                D
         arising under Section 34(2)( a), they may be brought to the
         notice of the Court by way of affidavits filed by both parties.
         Cross-examination of persons swearing to the affidavits should
         not be allowed unless absolutely necessary, as the truth will
         emerge on a reading of the affidavits filed by both parties. We,
         therefore, set aside the judgment [Girdhar Sondhi v. Emkay             E
         Global Financial Services Ltd., 2017 SCC OnLine Del 12758]
         of the Delhi High Court and reinstate that of the learned
         Additional District Judge dated 22-9-2016. The appeal is
         accordingly allowed with no order as to costs.”
      (iii) The decision of this Court in the case of Fiza                      F
      Developers(supra) again fell for consideration of this Court in
      the subsequent decision in the case of Canara Nidhi (supra).
      After taking note of the observations made in paragraph 21 in
      Emkay Global (supra), thereafter it is observed by this Court in
      the case of Canara Nidhi (supra) that the legal position is thus
      clarified that section 34 application will not ordinarily require         G
      anything beyond the record that was before the arbitration and
      that cross-examination of persons swearing in to the affidavits
      should not be allowed unless absolutely necessary.
      8. The ratio of the aforesaid three decisions on the scope and
ambit of section 34(2)(a) pre-amendment would be that applications under        H
1006             SUPREME COURT REPORTS                            [2023] 1 S.C.R.


 A     sections 34 of the Act are summary proceedings; an award can be set
       aside only on the grounds set out in section 34(2)(a) and section 34(2)
       (b); speedy resolution of the arbitral disputes has been the reason for
       enactment of 1996 Act and continues to be a reason for adding
       amendments to the said Act to strengthen the aforesaid object; therefore
       in the proceedings under section 34 of the Arbitration Act, the issues are
 B
       not required to be framed, otherwise if the issues are to be framed and
       oral evidence is taken in a summary proceedings, the said object will be
       defeated; an application for setting aside the arbitral award will not
       ordinarily require anything beyond the record that was before the
       arbitrator, however, if there are matters not containing such records and
 C     the relevant determination to the issues arising under section 34(2)(a),
       they may be brought to the notice of the Court by way of affidavits filed
       by both the parties’ the cross-examination of the persons swearing in to
       the affidavits should not be allowed unless absolutely necessary as the
       truth will emerge on the reading of the affidavits filed by both the parties.
       Therefore, in an exceptional case being made out and if it is brought to
 D
       the court on the matters not containing the record of the arbitrator that
       certain things are relevant to the determination of the issues arising under
       section 34(2)(a), then the party who has assailed the award on the
       grounds set out in section 34(2)(a) can be permitted to file affidavit in
       the form of evidence. However, the same shall be allowed unless
 E     absolutely necessary.
              9. Now so far as the submission on behalf of the appellant that
       the requirement of “furnishing proof” as per pre-amendment of section
       34(2)(a) of the Arbitration Act shall not be applicable to the application
       for setting aside the award on the grounds set out in section 34(2)(b) and
 F     the submission that in the execution proceedings the subsequent
       development of refusing to grant permission for amalgamation of the
       plots can be considered and it will be open for the applicants to point out
       in the execution proceedings that the award is not capable of being
       executed is concerned, at the outset, it is required to be noted that even
       for establishing that the arbitral award is in conflict with Public Policy of
 G     India, in a given case, the evidence may have to be led and by leading
       evidence, the person who is challenging the award on that ground can
       establish and prove that the arbitral award is in conflict with Public Policy
       of India and/or the subject matter of dispute is not capable of settlement
       by arbitration under the law for the time being in force. However, at the
 H     same time, from the record before the arbitrator, if the same can be
   M/S ALPINE HOUSING DEVELOPMENT CORPORATION                                   1007
     PVT. LTD. v. ASHOK S. DHARIWAL [M. R. SHAH, J.]

established and proved that the subject matter of the dispute is not capable    A
of settlement by arbitration under the law for the time being in force or
the arbitral award is in conflict with the Public Policy of India, in that
case, the person may not be permitted to file the affidavit by way of
evidence/additional evidence.
       10. Now so far as the submission on behalf of the appellant that         B
the subsequent development of refusing to grant permission by the
appropriate authority to amalgamate the plots can be considered in the
execution proceedings , a person against whom the award is passed and
who alleges on the grounds set out in section 34(2)(b) before the executing
court, the executing court may hold that the award is not capable of
being executed is concerned, it is required to be noted that so far as one      C
of the grounds set out in section 34(2)(b), namely, that the arbitral award
is in conflict with the Public Policy of India, the said ground could be
available only after passing of the award. Therefore, the same can be
permitted to be agitated in an application under section 34 of the Act and
the person shall not have to wait till the execution is filed. The defence      D
that the arbitral award is in conflict with the Public Policy of India itself
can be a ground to set aside the award in view of section 34(2)(b) of the
Act. Therefore, the aforesaid submission has no substance.
      11. Now the next question fell for consideration is, whether the
present case is such an exceptional case that it is necessary to grant          E
opportunity to the respondents to file affidavits and adduce evidence
and whether any case is made out for the same.
       From the affidavit, which is sought to be placed in the proceedings
under Section 34 of the Act, it is seen that the respondents want to place
on record the communication from the appropriate authority by which             F
the application for amalgamation of the plots is rejected. At this stage, it
is required to be noted that the arbitral tribunal has passed the decree for
specific performance of the contract/agreement, subject to the
amalgamation of the plots. Therefore, it is the case on behalf of the
respondents that in view of the refusal of the permission by the
appropriate authority to amalgamate the plots, the case falls under section     G
34(2)(b), namely, that the dispute is not capable of settlement under the
law for the time being in force and that the arbitral award is in conflict
with the Public Policy of India, namely, against the relevant land laws.
The event of refusal to amalgamate the plots is subsequent to the passing
of the award and therefore naturally the same shall not be forming part         H
1008              SUPREME COURT REPORTS                               [2023] 1 S.C.R.


 A     of the record of the arbitral tribunal. Even otherwise, it is required to be
       noted that the award of the arbitral tribunal was an ex- parte award and
       no evidence was before the arbitral tribunal on behalf of the respondents.
       We are not opining on whether the arbitral tribunal was justified in
       proceeding with the further proceedings ex-parte or not. Suffice it to
       record that before the arbitral tribunal, such evidence was not there and
 B
       nothing was on record on the amalgamation of the plots.
              The affidavit thus discloses specific document and the evidence
       requires to be produced. In that view of the matter, a strong exceptional
       case is made out by the respondents to permit them to file affidavits/
       adduce additional evidence. However, at the same time, the appellant
 C     also can be permitted to cross-examine and/or produce contrary evidence.
             12. In view of the above and for the reasons stated above, we are
       of the opinion that the High Court has not committed any error in
       permitting the respondents to file affidavits/additional evidence in the
       proceedings under section 34 of the Arbitration Act.
 D
             13. In view of the above and for the reasons stated above, the
       present appeal fails and the same deserves to be dismissed and is
       accordingly dismissed. However, it is observed that the appellant herein
       may also be permitted to cross-examine and/or lead contrary evidence
       including the permission for clubbing khatas where there are nalas as it
 E     is the case of the appellant that thereafter the corporation vide
       endorsement dated 28.6.2004 has agreed to consider clubbing of khatas.
       As and when such evidence is produced/led, the same may also be dealt
       with by the concerned court in accordance with law and on its own
       merits. However, at the same time, the court dealing with section 34
 F     application shall finally decide and dispose of section 34 application
       expeditiously, considering the object and purpose of the Arbitration Act,
       namely, speedy disposal.
              14. With these observations, the present appeal is dismissed. There
       shall be no order as to costs.
 G
       Ankit Gyan                                                       Appeal dismissed.
       (Assisted by : Abhishek Agnihotri and Mahendra Yadav, LCRAs)




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