“You raise the blade, you make the change,
You rearrange me till I am sane.”
Exercising the scalpel, the Delhi High Court in National Highways Authority of India v Trichy Thanjavur Expressway Ltd  (Trichy), has held that when an arbitral award is challenged under Section 34 of the Arbitration and Conciliation Act, 1996 (Arbitration Act), the court is not empowered to modify the award, but can surgically set aside severable parts of the arbitral award.
The issue is not a new one. However, it warranted a look in light of the decision of the Hon’ble Supreme Court in NHAI v. M. Hakeem (M. Hakeem) wherein the Supreme Court had held that an arbitral award could not be modified by a court hearing a challenge to the award.
The judgement in M. Hakeem pertained to arbitral awards whereby land compensation was awarded in relation to lands acquired under the National Highways Act, 1956. Dissatisfied by the compensation awarded, challenges were filed against these arbitral awards. The court hearing the challenge modified the compensation upwards. When the matter reached the Supreme Court, it ultimately held that it was impermissible for the court to modify an award; the court could either uphold it or set it aside.
Since the natural consequence of a blanket embargo on a court’s power to modify an award under Section 34 was construed by many as a prohibition on partial setting aside of an arbitral award, the question was posed to the Delhi High Court whether modification of an award would include within its ambit partial setting aside. If the answer is in the affirmative, partial setting aside would be impermissible and an entire arbitral award would be set to nought because of one defect.
There also existed conflicting precedents of various High Courts, allowing and disallowing partial setting aside of arbitral awards. Further, the decision in M. Hakeem had failed to consider J.G. Engineers Private Limited v. Union of India (J.G. Engineers). In J.G. Engineers, the Supreme Court had already held that if an arbitral award dealt with several claims separately and distinctly, then a court could separate the claims which did not suffer from any infirmity and uphold the award to that extent. Thus, the Delhi High Court was called upon to answer the question in light of these various decisions.
Findings of the Court
Modification v. Partial Setting Aside
The Delhi High Court held that partial setting aside of an award would not be contrary to the judgement in M. Hakeem since:
The power to partially set aside emanates from the statute.
Although Section 34 does not contain an overarching provision permitting the court to partially set aside an award, the Delhi High Court found that such a power could be read into it by holding as follows:
A separate and distinct claim in an award forms an award in itself and the award in respect of such a claim may be set aside whilst upholding another distinct claim.
The consequence of losing the entire arbitral award to a partial defect is one of the most dreaded outcomes for an award-holder. The Delhi High Court, by way of the instant judgment, has afforded clarity to the practice of partially setting aside awards in India and has struck the right balance between minimal intervention by courts in arbitral awards and preventing travesty of justice.
Nevertheless, unless the courts uphold the concept of minimal intervention in arbitral awards, the state of challenged awards could easily resemble Frankenstein disassembled and reassembled by an overzealous surgeon.
“This is a gift. It comes with a price. Who is the lamb and who is the knife?”
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 ‘Brain Damage’ from the album ‘The Dark Side of the Moon’ by Pink Floyd.
 2023 SCC OnLine Del 5183
 (2021) 9 SCC 1
 R.S. Jiwani v. IRCON International Ltd., 2010 (1) Mh. L.J. 547; Union of India v. Alcon Builders & Engineer(P) Ltd., 2023 SCC OnLine Del 160; Navayuga Engineering Company Ltd. vs. Union of India 2021 SCC OnLine Ker 5197
 MBL Infrastructures Ltd. v. Telecommunication Consultants of India, 2022 SCC OnLine Del 4613
 (2011) 5 SCC 758
 See Section 2(c) of the Arbitration Act.
 ‘Rabbit Heart (Raise it Up)’ from the album ‘Lungs’ by Florence and the Machine