Nullity at the Enforcement Stage: A new challenge to arbitral awards in India post- Electrosteel

Abstract The finality of arbitral awards in India is grounded in the limited and exclusive challenge mechanism under Section 34 of the Arbitration and Conciliation Act, 1996. However, the recent Supreme Court decision in Electrosteel Steel Ltd v Ispat Carrier Pvt Ltd has introduced a concerning shift by allowing arbitral awards to be challenged at the enforcement stage on the ground of ‘nullity’ under Section 47 of the Civil Procedure Code. This article critically examines the Court’s reasoning in Electrosteel, particularly its distinction between a Section 34 challenge and an execution-stage objection based on jurisdictional nullity. It argues that while the Court rightly identified the award as void ab initio due to contravention of the Insolvency and Bankruptcy Code, 2016, its broader ruling risks diluting the finality of awards by permitting belated challenges that should have been raised earlier in the arbitral process. The article traces the narrow contours of ‘nullity’ as an exception, stressing the need for a strict threshold that prevents the concept from evolving into a second ‘public policy’-like escape route. The article concludes by advocating a jurisprudence that recognizes nullity only in exceptional cases, and warns against its misuse as a backdoor to circumvent Section 34.