Beyond Setting Aside: The Contours And Consequences Of Modifying Arbitral Awards Post-Gayatri Balasamy
- IJLLR Journal
- Mar 23
- 1 min read
Vinay Sachdev, Priyavardhan Balot & Shreay Agrawal, B.A. LL.B. (Hons.), National Law University, Bhopal
ABSTRACT
The five-judge Constitution Bench decision in Gayatri Balasamy v. ISG Novasoft Technologies Ltd. (2025) has inaugurated a new and contested chapter in Indian arbitration law. For nearly three decades after the enactment of the Arbitration and Conciliation Act, 1996, the received orthodoxy held that a court entertaining a petition under Section 34 could either set aside an award or dismiss the challenge-nothing more. The Constitution Bench has ruptured this binary, holding that courts possess a limited, ancillary power to modify an arbitral award in cases where (a) a part of the award is severable from an invalid portion, or (b) post-award interest requires adjustment. This paper subjects that ruling to critical doctrinal and comparative scrutiny. It argues that, while the majority’s pragmatic impulse is understandable, the judgment’s textual basis is fragile, its boundaries unworkably vague, and its long-term consequences for India’s standing as an arbitration-friendly jurisdiction potentially grave. Drawing on comparative analysis of the United States, United Kingdom, and Singapore frameworks, and on a survey of the pre-Balasamy case law, the paper concludes with concrete legislative recommendations designed to achieve procedural efficiency without sacrificing the finality and party autonomy that are the bedrock of commercial arbitration.
Keywords: Arbitration, Section 34, Modification, Set Aside, Gayatri Balasamy, Finality, Judicial Review, UNCITRAL Model Law, India.
