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M/s. Kelkar & Kelkar vs. M/s. Hotel Pride Executive Pvt. Ltd.

Civil Appeal · 2022 INSC 507Decided 4 May 2022
Civil Appeal No. 3479 of 2022
M.R. Shah · B.V. Nagarathna

Background

A dispute between the parties was referred to arbitration, and the arbitrator awarded the claimant, Kelkar & Kelkar, about Rs. 12.46 lakh. The trial court made this award a decree of the court. Instead of challenging the award through the appeal process available under the (then-applicable) Arbitration Act, 1940, the losing party filed a writ petition directly in the Bombay High Court, arguing that a procedural requirement under a contract clause had not been followed before the arbitrator was appointed. The High Court agreed, set aside the award, and sent the matter back for fresh arbitration. The original claimant then appealed to the Supreme Court.

Decision Breakdown

The Supreme Court held that the High Court should not have entertained a writ petition under Articles 226/227 of the Constitution at all, because the law already provided a specific alternative remedy (an appeal under the Arbitration Act, 1940) against both the arbitral award and the trial court's order converting it into a decree. Because that statutory route existed and was not used, the writ petition should not have been allowed to bypass it. The Court set aside the High Court's order, but as a fair balance, gave the respondent liberty to now pursue the proper appeal under the Arbitration Act within four weeks, without that appeal being rejected merely on grounds of delay.

Lesson Learnt

Where the law provides a specific alternative remedy such as a statutory appeal, that route should ordinarily be used instead of a writ petition under Articles 226/227 challenging the same order. Courts are reluctant to let a writ petition become a shortcut around an available appeal process.

Official source (sci.gov.in)View Judgment (PDF)

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