34.Application for setting aside arbitral award.—(1) Recourse to a Court against an arbitral award
may be made only by anapplication for setting aside such award in accordance with sub-section (2) and
sub-section (3).
(2) An arbitral award may be set aside by the Court only if—
(a) the party making the application 1
[establishes on the basis of the record of the arbitral tribunal
that]—
(i) a party was under some incapacity, or
(ii) the arbitration agreement is not valid under the law to which the parties have subjected it
or, failing any indication thereon, underthe law for the time being in force; or
(iii) the party making the application was not given proper notice of the appointment of an
arbitrator or of the arbitral proceedings orwas otherwise unable to present his case; or
(iv) the arbitral award deals with a dispute not contemplated by or not falling within the terms
of the submission to arbitration, or itcontains decisions on matters beyond the scope of the
submission to arbitration:
Provided that, if the decisions on matters submitted to arbitration can be separated from those
not so submitted, only that part of thearbitral award which contains decisions on matters not
submitted to arbitration may be set aside; or
(v) the composition of the arbitral tribunal or the arbitral procedure was not in accordance
with the agreement of the parties, unlesssuch agreement was in conflict with a provision of this
Part from which the parties cannot derogate, or, failing such agreement, wasnot in accordance
with this Part; or
(b) the Court finds that—
(i) the subject-matter of the dispute is not capable of settlement by arbitration under the law
for the time being in force, or
(ii) the arbitral award is in conflict with the public policy of India.
2
[Explanation 1.—For the avoidance of any doubt, it is clarified that an award is in conflict with the
public policy of India, only if,—
(i) the making of the award was induced or affected by fraud or corruption or was in violation
of section 75 or section 81; or
(ii) it is in contravention with the fundamental policy of Indian law; or
(iii) it is in conflict with the most basic notions of morality or justice.
Explanation 2.—For the avoidance of doubt, the test as to whether there is a contravention with the
fundamental policy of Indian law shall not entail a review on the merits of the dispute.]
3
[(2A) An arbitral award arising out of arbitrations other than international commercial arbitrations,
may also be set aside by the Court, if the Court finds that the award is vitiated by patent illegality
appearing on the face of the award:

1. Subs. by Act 33 of 2019, s. 7, for “furnishes proof that” (w.e.f. 30-8-2019).
2. Subs. by Act 3 of 2016, s. 18, for the Explanation(w.e.f. 23-10-2015).
3. Ins. by s. 18, ibid. (w.e.f. 23-10-2015).
23
Provided that an award shall not be set aside merely on the ground of an erroneous application of the
law or by reappreciation of evidence.]
(3) An application for setting aside may not be made after three months have elapsed from the date on
which the party making thatapplication had received the arbitral award or, if a request had been made
under section 33, from the date on which that requesthad been disposed of by the arbitral tribunal:
Provided that if the Court is satisfied that the applicant was prevented by sufficient cause from
making the application within thesaid period of three months it may entertain the application within a
further period of thirty days, but not thereafter.
(4) On receipt of an application under sub-section (1), the Court may, where it is appropriate and it is
so requested by a party,adjourn the proceedings for a period of time determined by it in order to give the
arbitral tribunal an opportunity to resume thearbitral proceedings or to take such other action as in the
opinion of arbitral tribunal will eliminate the grounds for setting aside thearbitral award.
1
[(5) An application under this section shall be filed by a party only afterissuing a prior notice to the
other party and such application shall beaccompanied by an affidavit by the applicant endorsing
compliance with thesaid requirement.
(6) An application under this section shall be disposed of expeditiously,and in any event, within a period of one year
from the date on which the noticereferred to in sub-section (5) is served upon the other party.]
STATE AMENDMENT
Jammu and Kashmir and Ladakh (UTs).
Amendment of section 34.—
(i) after sub-section (2), insert the following sub-section, namely:-
“(2A) An arbitral award may also be set aside by the Court, if the Court finds that the award is
vitiated by patent illegality appearing on the face of the award:
Provided that an award shall not be set aside merely on the ground of an erroneous application of
the law or by re-appreciation of evidence.”;
(ii) in sub-section (3),–
(i) for“three months” substitute, “six months”;
(ii) in proviso thereto, for, “three months” and “thirty days” substitute respectively “six months”
and “sixty days”.
[Vide the Jammu and Kashmir Reorganization (Adaptation of Central Laws) Order, 2020, notification
No. S.O. 1123(E) dated (18-3-2020).]