[Cites 7, Cited by 0]
Jammu & Kashmir High Court
2026:Jklhc-Jmu:234-Db vs Respondent(S) on 6 February, 2026
Bench: Rajnesh Oswal, Rahul Bharti
2026:JKLHC-JMU:234-DB
HIGH COURT OF JAMMU & KASHMIR AND LADAKH
AT JAMMU
Reserved on: 10.12.2025
Pronounced on 06.02.2026
Uploaded on 09.02.2026
Whether the operative part or full
judgment is pronounced: Full
judgment.
Case No. AA No. 07/2025
Union of India ...Petitioner(s)/Appellant(s)
Through: Mr. Vishal Sharma, DSGI with
Mr. Sumant Sudan, Advocate
v/s
.... Respondent(s)
M/s K. K. Enterprises
Contractors
Through: Mr. Jugal Kishore Gupta,
Advocate
CORAM HON'BLE MR. JUSTICE RAJNESH OSWAL, JUDGE
HON'BLE MR. JUSTICE RAHUL BHARTI, JUDGE
JUDGMENT
'OSWAL-J'
1. This appeal has been preferred under Section 37 of
the J&K Arbitration & Conciliation Act, 1997
(hereinafter referred to as " the Act") for assailing an
2026:JKLHC-JMU:234-DB
order dated 27.01.2025 passed by the Court of
learned Additional District Judge (Commercial
Court), Jammu (hereinafter referred to as "the
Commercial Court), whereby the application filed by
the appellant under Section 34 of the Act
challenging an arbitral award dated 16.07.2015
published by arbitral tribunal of sole arbitrator-
Brig. R. S. Sharma, has been dismissed.
2. The appellant challenges the order dated
27.01.2025, contending that the learned
Commercial Court failed to consider a pivotal
ground raised in the application under Section 34 of
the Act that the arbitral award was a non-speaking
one. Furthermore, the appellant submits that the
Commercial Court failed to consider and examine
any of the substantive grounds urged to challenge
the impugned award.
3. Heard learned counsel for the parties and perused
the record.
4. Essential facts emanating from the record are that a
contract agreement bearing CA No. GEJC-80/2002-
03 was entered into between the parties hereto for
2026:JKLHC-JMU:234-DB
work of Special Repairs to Electric Wiring and
Replacement of Electric Fitments of Capital
MD/OTM Accn. of FD. Amb at Domana.
5. Certain disputes arose between the contracting
parties and, accordingly, vide an order dated
07.03.2014, Brig. R. S. Sharma ACE (Works) H. Q.
Chief Engineer Northern Command was appointed
as the sole Arbitrator to adjudicate the arbitral
dispute between the parties.
6. The sole Arbitrator entered upon the reference vide
letter dated 27.08.2014, thereby calling upon the
parties to submit their respective Statement of
facts/pleadings in defense and rejoinder.
7. The arbitrator's record depicts that the respondent
raised thirteen claims, whereas the appellant raised
two claims before the arbitral tribunal.
8. Out of thirteen claims preferred by the respondent,
the learned Arbitrator allowed eight claims and
rejected the remaining claims.
9. The two claims raised by the appellant were also
rejected.
2026:JKLHC-JMU:234-DB
10. Thus, vide award dated 16.07.2015, the arbitration
case came to wind up.
11. Aggrieved thereby, the appellant assailed the
arbitral award dated 16.07.2015 before the
Commercial Court on the following grounds:
(a)That award is against the contract agreement,
settled principles of law and also principles of
natural justice.
(b) That award is against the principle of
adjudication, where the arbitrator has failed to
draw inferences which ought to have been drawn
from the conditions of the contract agreement
while on the other hand, the arbitrator has drawn
inferences, which on the face of it, are untenable
resulting in miscarriage of justice.
(c)The award is against the principles which are
now recognized as juristic fundamental in
administrative law. The award is perverse and
irrational, and no reasonable person would arrive
at the conclusion drawn by the arbitrator.
2026:JKLHC-JMU:234-DB
(d) That the award falls short of the standards of
reasonableness laid down on the touch stone of
Wednesbury's principle of reasonableness.
(e)That the arbitrator is a quasi-judicial Authority
and his approach has to be judicial. In this case,
the award is an outcome of arbitrary, capricious
and whimsical manner of the arbitrator.
12. By the impugned order dated 27.01.2025, the
learned Commercial Court dismissed the appellant's
application bearing the challenge to the arbitral
award.
13. It is well-settled that an arbitral award can only be
set aside only within narrow confines of the grounds
as stipulated under Section 34 of the Act. Even
before this Court, the appellant has failed to
demonstrate any such grounds that would warrant
interference.
14. In 'Ramesh Kumar Jain vs. Bharat Aluminum
Company Ltd. (Balco)', 2025 INSC 1457, the
Hon'ble Supreme Court of India has held that "It is
a settled proposition of law as has been constantly
observed by this court and we reiterate, the courts
2026:JKLHC-JMU:234-DB
exercising jurisdiction under section 34 do not sit in
appeal over the arbitral award hence they are not
expected to examine the legality, reasonableness or
correctness of findings on facts or law unless they
come under any of grounds mandated in the said
provision."
15. We agree in full with the learned Commercial Court
that the appellant failed to demonstrate lest
substantiate any perversity in the award. The
arguments presented were superficial and do not
align with the statutory requirements of Section 34
of the Act.
16. In Ramesh Kumar Jain's case ibid, the Hon'ble
Supreme Court of India has further observed that
"When it comes to section 37 of the A&C Act it
provides for a limited appellate remedy against an
order either setting aside or refusing to set aside an
arbitral award passed by civil court in exercise of its
power under section 34. This court in MMTC Ltd. v.
Vedanta Ltd.15, at Paragraph 14 observed that
interference with an order made under section 37
2026:JKLHC-JMU:234-DB
cannot travel beyond the restrictions laid down in
section 34".
17. The learned Commercial Court also reviewed the
rejection of the appellant's challenge regarding
future interest. While the respondent sought
interest @ 18% per annum for the ante-lite,
pendente lite, and future periods under Claim No.
13, the Arbitrator granted interest at 12% per
annum effective 16.10.2015. Notably, the Arbitrator
specified that future interest would not apply to the
accumulated past and pendente lite interest totals
set out in Para (a) of the award.
18. Section 31(7) (b) of the Act (prior to amendment)
stipulated that a sum directed to be paid by an
arbitral award shall, unless the award otherwise
directs, carry interest at the rate of 18% per annum
from the date of the award until the date of
payment. In the present case, the learned Arbitrator
exercised his discretion to grant future interest at
the rate of 12% per annum. We find no illegality in
this determination.
2026:JKLHC-JMU:234-DB
19. Having carefully examined the impugned order, we
find no legal infirmity or error with respect to
impugned order warranting interference to any
extent and effect by this Court. The present appeal,
being devoid of merit, is hereby dismissed. It is
noted that an amount of Rs. 5,00,000/- has
already been released in favor of the respondent. We
hereby direct that the balance amount, together
with all accrued interest, be released to the
respondent in accordance with the law.
(RAHUL BHARTI) (RAJNESH OSWAL)
JUDGE JUDGE
JAMMU:
06.02.2026
Karam Chand
Whether the order is speaking: Yes
Whether the order is reportable: No
