Madras HC Flags Confusion Over Numbering in Gayatri Balasamy Judgment [Read Judgment]

Madurai: While deciding an arbitration appeal, the Madurai Bench of the Madras High Court has pointed out that the continuous paragraph numbering used across the majority and dissenting opinions in the Supreme Court's Constitution Bench judgment in Gayatri Balasamy v. ISG Novasoft Technologies Ltd. has misled readers into treating the dissent's concluding paragraph as the Court's actual answer to the reference, and has asked law reporters to ensure such confusion does not recur.

A Bench of Justice G.R. Swaminathan and Justice M.D. Sumathi was examining the extent to which a court exercising jurisdiction under Sections 34 or 37 of the Arbitration and Conciliation Act, 1996 can modify an arbitral award, a question authoritatively settled by the Constitution Bench in Gayatri Balasamy. 

The Court noted that because the paragraphs of the majority opinion and of Justice K.V. Viswanathan's partly dissenting opinion had been numbered continuously as one unbroken sequence, several readers of the judgment, including members of the Bar and Bench, had mistaken the dissent's final paragraph, numbered 159 in some reports, for the majority's formal answer to the reference.

Recording this experience in its own judgment, the Court observed that “in view of the continuous numbering of the paragraphs of the judgements of both the majority judges as well as that of His Lordship K.V.V.J, many of us went by the final paragraph as the answer to the reference,” adding that this reading did not sit well with what the majority had actually expressed, and requesting law reporters to ensure that such confusion is not caused in the future.

Clarifying the correct position, the Court noted that even the majority judgment in Gayatri Balasamy does not permit a Section 34 or Section 37 court to grant a relief that the Arbitral Tribunal has expressly refused; the power to modify an award is limited to severing invalid portions, correcting clerical, computational or typographical errors, adjusting post-award interest in limited circumstances, or invoking Article 142 of the Constitution with care. It was this correctly understood position, rather than the misread final paragraph, that the Court went on to apply.

The observation arose in the course of appeals filed by the V.O. Chidambaranar Port Trust against orders of the Principal District Court, Thoothukudi, which had gone beyond the Arbitral Tribunal's award in an arbitration arising out of a defunct Tuticorin-Colombo ferry service, and had awarded liquidated damages to the operator, M/s. Flemingo Duty Free Shop (P) Ltd., that the Tribunal had specifically declined to grant. Applying the correctly understood ratio in Gayatri Balasamy, the Court held that the District Judge had, in effect, “virtually rewritten the award,” and set aside that part of the order, while confirming the rejection of the Port Trust's own counterclaim in the connected appeal.

Appearances:

For the Appellant: Mr. B. Saravanan, Additional Advocate General, assisted by Mr. A. Arivuchandran.

For the Respondent: Mr. C. Mani Shankar, Senior Counsel, for M/s. Vast Law Associates.

Case Title: V.O. Chidambaranar Port Trust vs. M/s. Flemingo Duty Free Shop (P) Ltd., C.M.A.(MD)Nos.462 and 463 of 2021 with C.M.P.(MD)No.4036 of 2021. 

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