Recently, the Delhi High Court has held that for a valid delivery of an Arbitral Award under the Arbitration and Conciliation Act, 1996, the service of the award must be directly addressed to the relevant party and not to their agents or advocates.

In a case involving a dispute between the Ministry of Health and Family Welfare (MoHFW) and Hosmac, the Court allowed the appeal of the MoHFW against the Trial Court's rejection of Section 34 Application. The Arbitral Award was granted to Hosmac, and the Corrigendum Order was contested by MoHFW. However, the Court recognized the Appellant/MoHFW as the arbitration party, not RML. The Court highlighted that the service of the Arbitral Award was invalid under Section 31(5) of the Act as it was sent to RML's counsel but not to the Appellant/MoHFW.

The Sole Arbitrator awarded Hosmac a considerable sum, including costs, for a construction and renovation agreement for Emergency Care Services and VIP Rooms at Dr Ram Manohar Lohia Hospital (RML), New Delhi. The MoHFW and the hospital filed a petition before the Trial Court to set aside the Arbitral Award and the Corrigendum Order. The petition was, however, dismissed by the Trial Court under Section 34 of the Act.

The MoHFW appealed against the judgment of the Trial Court by way of an Appeal Section 37, and the High Court issued an order instructing the Sole Arbitrator to submit the entire Arbitral record. The High Court noted that a signed copy of the Arbitral Award should be delivered directly to each party competent to decide whether to challenge the award and that the term 'party' excludes agents or lawyers of the party.

The Court emphasized that every Arbitral Award and any corrigendum must be served on all parties for valid service under Section 34(3) of the Act. The Court also rejected the argument that serving RML constitutes serving the Appellant/MoHFW, emphasizing that the challenge to the award could only be initiated by the Appellant/MoHFW. Therefore, the Court allowed the appeal and set aside the impugned judgment.