My Lord, Perverse Judgment?

“This Court has already laid down as to which finding would be called perverse. It is a finding which is not only against weight of evidence but altogether against evidence. This Court has held in Triveni Rubber, AIR 1994 SC 1341, a perverse finding is one which is based on no evidence or one that no reasonable person would have arrived at. Unless it is found, some relevant evidence has not been considered or certain inadmissible material has been taken into consideration, a finding cannot be said to be perverse. See, Arulvelu, (2009) 10 SCC 206.”

– Hon’ble Justice H.L. Gokhale, Sumimoto Heavy Industries, (2010) 11 SCC 296.

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Also see, Noorahammad v. State of Karnataka, [Criminal Appeal No. 412 of 2006] decided on 02.02.2016 and Chaman Lal v. State of Himachal Pradesh, [Criminal Appeal No. 1227 of 2017] decided on 03.12.2020.

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To understand test of perversity, it will also be appropriate to refer to Paragraph 31 and 32 from Associate Builders v. Delhi Development Authority, (2015) 3 SCC 49.

– Hon’ble Justice B.R. Gavai, PSA SICAL Terminals Pvt. Ltd. v. Board of Trustees of V.O. Chidambranar Port Trust, Tuticorin, [Civil Appeal Nos. 3699-3700 of 2018] decided on 28.07.2021.

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Arbitral Tribunal being a creature of contract, is bound to act in terms of contract under which it is constituted. However, a distinction has to be drawn between failure to act in terms of a contract and an erroneous interpretation of terms of a contract. Court does not ordinarily interfere with interpretation made by Arbitral Tribunal of a contractual provision, unless such interpretation is patently unreasonable or perverse.

Where a contractual provision is ambiguous or is capable of being interpreted in more ways than one, Court cannot interfere with Arbitral Award only because Court is of opinion another possible interpretation would have been a better one.

PSA SICAL Terminals Pvt. Ltd. v. Board of Trustees of V.O. Chidambranar Port Trust Tuticorin, (2021) SCC Online SC 508 clearly held, Arbitrator had no power apart from what parties had given him under contract. If he has travelled beyond, he would be acting without jurisdiction.

– Hon’ble Justice Indira Banerjee, Indian Oil Corporation Ltd. v. M/s. Shree Ganesh Petroleum, Rajgurunagar, [Civil Appeal Nos. 837-838 of 2022] decided on 01.02.2022.