Karnataka HC Chief Justice Vibhu Bakhru warns that full merit review of arbitral awards defeats arbitration’s purpose of finality and speed.
Courts Reviewing Awards on Merits Undermine Arbitration
Karnataka High Court Chief Justice Vibhu Bakhru stated that allowing courts to conduct a full merits-based review of arbitral awards undermines the core objectives of arbitration—finality, efficiency, and party autonomy. He made the remarks at a conference on Ethics and Evidence in Arbitration in Bengaluru.
While acknowledging concerns about award quality, Justice Bakhru cautioned against judicial overreach, emphasizing that the scope of challenge under Section 34 of the Arbitration and Conciliation Act, 1996, is limited to patent illegality and procedural fairness, not re-evaluation of evidence or factual conclusions.
His comments align with recent Supreme Court rulings narrowing the grounds for intervention. Practitioners should expect increased judicial restraint in setting aside awards, reinforcing India’s efforts to become a more arbitration-friendly jurisdiction.
