Arbitral award can be modified under Section 33 of Arbitration Act only in case of arithmetic or clerical errors: Supreme Court

The Supreme Court has held that an arbitral award can be modified by way of an application under Section 33 of the Arbitration and Conciliation Act, 1996 only in case of an arithmetic or a clerical error (Gyan Prakash Arya vs. M/s Titan Industries Limited)..A Bench of Justices MR Shah and BV Nagarathna was hearing a dispute relating to recovery of pure gold weighing 3648.80 grams, said to have been in the possession of the appellant. The respondent invoked the arbitration clause after which the High Court appointed a retired district judge as the sole arbitrator..The arbitrator passed an award directing the appellant to return the gold to the appellant with interest at 18 per cent per annum, calculating the value of gold at ₹740 per gram from July 24, 2004 to the date of delivery of the quantity of gold..The dispute arose when the respondent subsequently filed an application under Section 33 of the Act seeking to modify the award.By way of the plea, it was requested that a correction be made to the award by deleting “at ₹740 per gram" as claimed in the claim statement and “₹740.00 per gram” at page 17, para 15(b), line 3, and substitute the same by “₹20,747 per 10 grams”..The arbitrator allowed the application and the decision was upheld by the City Civil Court as well as the Karnataka High Court leading to the present appeal before the Supreme Court..The counsel for the appellant argued that the order was beyond the scope and ambit of jurisdiction of the arbitrator under Section 33 since there was no arithmetic or clerical error.“What was awarded by the learned arbitrator was as per the original claim made by the claimant and even the discussion by the learned arbitrator was on the claim as made by the original claimant after a discussion on merits and on appreciation of the evidence on record,” it was pointed out..The Court agreed with the appellant, observed that in the present case, there was no arithmetical or clerical error in the original award passed by the arbitrator. Therefore, the order challenged was beyond the scope and ambit of Section 33 of the 1996 Act..The Bench stated that both the City Civil Court and High Court committed a grave error by dismissing the appeal. “In view of the above and for the reasons stated above, the present appeal is allowed,” the Court ruled..Senior Advocate Sukumar Pattjoshi and Devasa & Co. appeared for the Petitioners. The Respondents were represented by Senior Advocate Sajan Poovayya assisted by Advocates Vikram Hegde, Shravanth Arya Tandra, N.S. Sriraj Gowda, Shantanu Lakhotia, Raksha Agarwal and Sharan Balakrishna..[Read Judgment].Follow Bar and Bench channel on WhatsAppDownload the Bar and Bench Mobile app for instant access to the latest legal news.