It is not the volume of evidence but its quality: Delhi HC upholds a limestone shipping award
An arbitral award is not to be read like a judgment, the Court holds, rejecting a challenge built on notices of readiness and an allegation that voluminous evidence was ignored.
Steel Authority of India asked the Delhi High Court to set aside a three-member tribunal’s award on the ground, among others, that the voluminous evidence it had produced was not considered. On 22 September 2026, in Steel Authority of India v. Norvic Shipping North America Inc., Justice Avneesh Jhingan answered that it is not the volume but the quality of evidence that matters — and that the quality of evidence to be considered falls within the domain of the arbitrator.
Sixteen lakh tonnes of limestone
Norvic Shipping North America Inc. is a company incorporated under the laws of Canada, engaged in the transportation of dry bulk cargoes including limestone. Steel Authority of India Limited is a listed public sector undertaking engaged in the manufacture of steel. On 5 April 2019 they executed a Contract of Affreightment for the shipping of 16,00,000 metric tons of limestone.
Disputes followed and went to a three-member tribunal, which made its award on 19 October 2022, rectified by an order of 21 February 2023. SAIL challenged it under Section 34 of the Arbitration and Conciliation Act, 1996.
The notice of readiness
A central plank of the challenge concerned the vessel MV Pegasus and the notice of readiness tendered for it. SAIL contended that the NOR issued at Haldia Port on 10 May 2019 was premature, because when the vessel was called to berth on 17 May 2019 it was unable to do so owing to a generator problem. A revised NOR was issued on 17 May, and the vessel berthed on 19 May.
The argument matters commercially because laytime, and with it demurrage, ordinarily runs from a valid notice of readiness. A notice tendered by a vessel that is not in fact ready is, on the charterer’s case, no notice at all, and the clock should not have started.
In support SAIL relied on industry literature — a guide titled “Notices of readiness in a nutshell” published by the West of England P&I Club. The tribunal had considered the question and decided it, and the Court’s treatment of the challenge turns not on whether the notice was premature but on who was entitled to decide that.
What a Section 34 court does not do
The judgment restates the boundary with a series of Supreme Court authorities, and the framing is unusually direct.
On the evidence point, it held the contention that voluminous evidence was not considered to be liable to rejection, because it is not the volume but the quality of evidence that matters, and the assessment of that quality lies in the arbitrator’s domain — citing Parsa Kente Collieries Ltd. v. Rajasthan Rajya Vidyut Utpadan Nigam Ltd. and, through it, Associate Builders.
On the adequacy of reasons, it held that an award is not to be placed on the pedestal of judgments passed by judicial courts for the purpose of testing the reasons recorded. Dyna Technologies Pvt. Ltd. v. Crompton Greaves Ltd. supplies the standard: the mandate under Section 31(3) is that reasoning be intelligible and adequate, and in appropriate cases it may even be implied.
Having found that the award was not bereft of reasons and that the petitioner’s contentions had not been totally ignored, the Court expressly declined to decide a further question that had been argued — whether a non-speaking award falls within the ambit of a violation of the public policy of India. The question did not arise on these facts, and the judgment leaves it where it found it.
Why the cited cases did not carry
The distinctions the Court drew are as instructive as the propositions it applied.
Dyna Technologies, McDermott International Inc. and Bharat Vanijya Eastern Private Ltd. were held not to advance SAIL’s case for a reason that goes to the architecture of Section 34: those cases were not international commercial arbitrations. This one is, Norvic being a Canadian company — and the grounds available against an award in an international commercial arbitration are narrower, the patent-illegality ground introduced by Section 34(2A) being unavailable. The Court added that McDermott in any event predates the 2015 amendment to Section 34.
On interest, SAIL relied on Halliburton Offshore Services Inc. The Court found it inapplicable on the facts. There, the challenge was to a uniform rate of interest granted on both the Indian rupee and Euro components of an award. Here the interest awarded is at LIBOR plus three percentage points, or 12 per cent a year, whichever is less. The argument that this is an open-ended rate, leaving it undecided which rate is to be claimed, was held to be factually misconceived: the language is unambiguous, because the formula itself identifies which of the two applies in any given period.
The practical reading
For a party challenging an award in an international commercial arbitration, the judgment maps the ground that is left. An allegation that the tribunal ignored evidence will not succeed by showing how much evidence there was; it requires showing that the award does not deal with the case at all. An allegation that reasons are inadequate is tested against intelligibility and adequacy, not against the standards of a judgment, and implied reasoning may suffice.
The point about which line of authority applies is one practitioners will take away. A domestic award and an award in an international commercial arbitration are not challenged on the same grounds, and a decision rendered in the former context — particularly one predating the 2015 amendment — may not transfer.
Order
The Court found no ground made out to interfere with the arbitral award dated 19 October 2022 as rectified on 21 February 2023, and dismissed the petition under Section 34. The judgment was marked reportable.