Supreme court: High court justified in setting aside co-operative arbitrator's award where relevant documents were ignored

Supreme Court Affirms High Court's Decision to Overturn Arbitration Award Due to Ignored Documents, Highlighting Judicial Oversight in Arbitration Processes.

Case Title: Shri Prakash Narain Sharma (Dead) Through Legal Representative v. Burmah Shell Co-Operative Housing Society (Regd) and Ors.

Citation: (2026) ibclaw.in 557 SC

Coram: Justice Ujjal Bhuyan and Justice Atul S. Chandurkar

The Supreme Court has dismissed a batch of civil appeals arising out of a dispute concerning allotment of a plot by a co-operative housing society, holding that the Delhi High Court did not exceed its jurisdiction under Articles 226 and 227 of the Constitution while setting aside concurrent orders passed by an Arbitrator under Section 61 and the Delhi Co-operative Tribunal under Section 76 of the Delhi Co-operative Societies Act, 1972.

The dispute traced back to a claim raised by the original claimant, who contended that he was a member of Burmah Shell Co-operative Housing Society and was entitled to allotment of a plot. After a chequered history spanning several decades, including an earlier round before the Supreme Court which set aside an ex-parte award and directed continuation of arbitration proceedings, the Registrar, acting as Arbitrator, passed an award in 2003 holding that the original claimant was a member of the Society and directing allotment of a plot to his legal heir. The Tribunal affirmed this order in a short appellate order.

The Society challenged these orders before the Delhi High Court, which found that neither the Arbitrator nor the Tribunal had considered material documents on record, including the Minutes of the Managing Committee Meeting recording the original claimant's resignation and its acceptance in 1951, the subsequent rejection of his membership application in 1952, and the rejection of his request to deposit money for a plot in 1979. The High Court held that had these documents been considered, the finding would have gone in favour of the Society, and accordingly set aside the orders of the Arbitrator and the Tribunal.

Before the Supreme Court, the appellant argued that the High Court, exercising supervisory jurisdiction, was not entitled to reappreciate evidence and interfere with concurrent findings of fact, relying on the distinction between Article 226 and Article 227 jurisdiction explained in Shalini Shyam Shetty v. Rajendra Shankar Patil. The Society supported the High Court's judgment, contending that the authorities below had ignored crucial documentary evidence establishing that the original claimant's membership had never been granted after his resignation in 1951.

The Supreme Court examined the scope of certiorari jurisdiction with reference to its earlier decisions in General Manager, Electrical Rengali Hydro Electric Project v. Giridhari Sahu and Central Council for Research in Ayurvedic Sciences v. Bikartan Das, reiterating that while a writ court does not sit in appeal over findings of fact, a finding recorded without any supporting evidence, or one that is perverse, amounts to an error of law correctable through certiorari.

Applying this principle, the Court held that the Registrar and the Tribunal had glossed over relevant documentary material which, if considered, could have led to only one conclusion, that the original claimant was never admitted as a member of the Society. The Court noted that the Registrar's order had proceeded on a mere presumption of continued membership without any legal basis for such presumption. The Court also upheld the High Court's reliance on equitable considerations, noting that four other members had a prior claim for allotment of a plot.

Holding that no case for interference was made out, the Supreme Court dismissed the civil appeals and affirmed the High Court's judgment setting aside the orders of the Arbitrator and the Tribunal, with no order as to costs.