The 'PUBLIC POLICY' ground for SETTING ASIDE under Section 34(2)(b)(ii) Arbitration Act 1996 has been NARROWED by:
Ano amendment (cf. Arbitration and Conciliation Act 1996, Section 34(2)(b)(ii); Renusagar Power Co. v. General Electric Co. (1994); ONGC v. Saw Pipes (2003); Associate Builders v. DDA (2015); Ssangyong Engineering (2019)) (cf. Arbitration and Conciliation Act 1996, Section 34(2)(b)(ii); Renusagar Power Co. v. General Electric Co. (1994); ONGC v. Saw Pipes (2003); Associate Builders v. DDA (2015); Ssangyong Engineering (2019))
B2015 Amendment Explanation 1 — 'public policy' includes: (i) FRAUD OR CORRUPTION in the making of the award; (ii) CONTRAVENTION of the FUNDAMENTAL POLICY of Indian law; (iii) award in conflict with the BASIC NOTIONS of MORALITY OR JUSTICE. Section 34(2A) introduced PATENT ILLEGALITY (limited to domestic awards) as additional ground
Cextended (cf. Arbitration and Conciliation Act 1996, Section 34(2)(b)(ii); Renusagar Power Co. v. General Electric Co. (1994); ONGC v. Saw Pipes (2003); Associate Builders v. DDA (2015); Ssangyong Engineering (2019)) (cf. Arbitration and Conciliation Act 1996, Section 34(2)(b)(ii); Renusagar Power Co. v. General Electric Co. (1994); ONGC v. Saw Pipes (2003); Associate Builders v. DDA (2015); Ssangyong Engineering (2019))
Dunchanged (cf. Arbitration and Conciliation Act 1996, Section 34(2)(b)(ii); Renusagar Power Co. v. General Electric Co. (1994); ONGC v. Saw Pipes (2003); Associate Builders v. DDA (2015); Ssangyong Engineering (2019)) (cf. Arbitration and Conciliation Act 1996, Section 34(2)(b)(ii); Renusagar Power Co. v. General Electric Co. (1994); ONGC v. Saw Pipes (2003); Associate Builders v. DDA (2015); Ssangyong Engineering (2019))
Answer & Solution
Correct answer: B. 2015 Amendment Explanation 1 — 'public policy' includes: (i) FRAUD OR CORRUPTION in the making of the award; (ii) CONTRAVENTION of the FUNDAMENTAL POLICY of Indian law; (iii) award in conflict with the BASIC NOTIONS of MORALITY OR JUSTICE. Section 34(2A) introduced PATENT ILLEGALITY (limited to domestic awards) as additional ground
1. The 'PUBLIC POLICY' ground under Section 34(2)(b)(ii) of the Arbitration Act 1996 has evolved:
2. RENUSAGAR Power Co. v. General Electric Co. (1994) 1 SCC 644 (Supp): public policy interpreted NARROWLY — only fundamental policy of Indian law, interest of India, justice or morality.
3. ONGC v. SAW PIPES Ltd, (2003) 5 SCC 705: WIDENED public policy to include patent illegality, perversity.
4. ASSOCIATE BUILDERS v. DDA, (2015) 3 SCC 49: ELABORATED meaning of public policy components.
5. The 2015 AMENDMENT to Section 34 NARROWED public policy:
6. (i) EXPLANATION 1 to Section 34(2)(b)(ii): public policy includes — (a) award making is induced by fraud or corruption; (b) award is in contravention with fundamental policy of Indian law; (c) award conflicts with basic notion of morality or justice.
7. (ii) EXPLANATION 2: contravention of fundamental policy shall not entail a REVIEW ON MERITS.
8. Section 34(2A) (inserted 2015) added PATENT ILLEGALITY as a separate ground for DOMESTIC AWARDS only — also narrowly construed.
9. SSANGYONG ENGINEERING & CONSTRUCTION Co. Ltd. v. NHAI, (2019) 15 SCC 131 — clarified post-2015 standards.
10. Hence option B is correct.
_Source: Arbitration and Conciliation Act 1996 (Bare Act) + Mediation Act 2023 — Arbitration and Conciliation Act 1996, Section 34(2)(b)(ii); Renusagar Power Co. v. General Electric Co. (1994); ONGC v. Saw Pipes (2003); Associate Builders v. DDA (2015); Ssangyong Engineering (2019)_
Related questions
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