Section 37 Arbitration Act A Complete Code; Order Under Sec 17(2) Enforcing Emergency Arbitrator's Award Not Appealable Under Sec.37 : Supreme Court

The Supreme Court has held that an order of enforcement of an Emergency Arbitrator's order made under Section 17(2) of the Arbitration and Conciliation Act is not appealable under Section 37 of the Act.

Section 37 is a complete code so far as appeals from orders and awards made under the Arbitration Act are concerned, the bench of Justice RF Nariman and BR Gavai said while disposing the appeal filed by Amazon.com NV Investment Holdings LLC.

Amazon initiated arbitration proceedings and filed an application seeking emergency interim relief under the Singapore International Arbitration Centre Rules, asking for injunction relief. Mr. V.K. Rajah, SC was appointed as the Emergency Arbitrator who after hearing the parties passed an "interim award". Amazon, thereafter, filed a petition before the High Court of Delhi under Section 17(2) of the Arbitration Act seeking to enforce the award/order of an Emergency Arbitrator. The single bench of the High Court held that an Emergency Arbitrator's award is an order under Section 17(1) of the Arbitration Act. Later, the Division bench stayed this order of Single Bench and this stay order was assailed before the Apex Court. The Division bench also held that an appeal against an order under Section 17(2) of the Arbitration Act would be maintainable under the provisions of the Code of Civil Procedure.

Section 17(2) reads as follows: Subject to any orders passed in an appeal under section 37, any order issued by the arbitral tribunal under this section shall be deemed to be an order of the court for all purposes and shall be enforceable under the Code of Civil Procedure, 1908, in the same manner as if it were an order of the court. 

Two issues were considered in the appeal :

(1) whether an "award" delivered by an Emergency Arbitrator under the Arbitration Rules of the Singapore International Arbitration Centre ["SIAC Rules"] can be said to be an order under Section 17(1) of the Arbitration Act; and

(2) whether an order passed under Section 17(2) of the Arbitration Act in enforcement of 1 the award of an Emergency Arbitrator by a learned Single Judge of the High Court is appealable.

The bench, answering the first issue, held that full party autonomy is given by the Arbitration Act to have a dispute decided in accordance with institutional rules which can include Emergency Arbitrators delivering interim orders, described as "awards" and therefore such orders are referable to and are made under Section 17(1) of the Arbitration Act. Click here to read more on this issue.

Regarding the second issue, Amazon contended that the the Arbitration Act is a complete code in itself and if an appeal does not fall within the four corners of Section 37, then it is not appealable. The other side contended that the appeal was filed not under Section 37 of the Arbitration Act but was under Order XLIII, Rule 1(r) of the Code of Civil Procedure. In enforcement proceedings – both under Section 17(2) and under Section 36(1) – appeals can be filed from such orders under the Code of Civil Procedure, it was contended.

To answer the second question, the bench noticed that Section 37 is a complete code so far as appeals from orders and awards made under the Arbitration Act are concerned. It noted that even after the amendment, Section 37 continued to provide appeals only from an order granting or refusing to grant any interim measure under Section 17. It also noted that no corresponding amendment was made to Section 37(2)(b) to include within its scope the amended Section 17. 

Answering these contentions the bench observed that "There can be no doubt that granting or refusing to grant any interim measure under Section 17 would only refer to the grant or non-grant of interim measures under Section 17(1)(i) and 17(1) (ii). In fact, the opening words of Section 17(2), namely, "subject to any orders passed in appeal under Section 37…" also demonstrates the legislature's understanding that orders that are passed in an appeal under Section 37 are relatable only to Section 17(1). For example, an appeal against an order refusing an injunction may be allowed, in which case subsection (2) of Section 17 then kicks in to enforce the order passed in appeal. Also, the legislature made no amendment to the granting or refusing to grant any measure under Section 9 to bring it in line with Order XLIII, Rule 1(r), under Section 37(1)(b). What is clear from this is that enforcement proceedings are not covered by the appeal provision." , the bench observed.

"The second question posed is thus answered declaring that no appeal lies under Section 37 of the Arbitration Act against an order of enforcement of an Emergency Arbitrator's order made under Section 17(2) of the Act" , the court held.

Case: Amazon.com NV Investment Holdings LLC vs. Future Retail Limited ; CA 4492-4493 OF 2021
Coram:  Justices RF Nariman and BR Gavai 
Counsel: Sr. Adv Gopal Subramanium,  Sr. Adv Ranjit Kumar for Appellant, Sr. Adv Harish Salve, Sr. Adv . K.V. Viswanathan, Sr. Adv Vikram Nankani for respondent
Citation: LL 2021 SC 357

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