Yes—but only in a limited and controlled manner. In Gayatri Balasamy v. ISG Novasoft Technologies Ltd., a 4:1 Constitution Bench of the Supreme Court held that courts exercising jurisdiction under Sections 34 and 37 of the Arbitration and Conciliation Act, 1996 can modify an arbitral award in certain narrow situations. The judgment did not convert a Section 34 challenge into an appeal or permit courts to reconsider the merits of an arbitration. Supreme Court of India
The position became even more important in 2026. In M/s Saisudhir Energy Ltd. v. M/s NTPC Vidyut Vyapar Nigam Ltd., 2026 INSC 103, the Supreme Court applied Gayatri Balasamy and upheld a Section 34 modification where the court merely applied the contractual formula to the established facts without undertaking a fresh examination of the merits. Sci API
Read the Supreme Court judgment — Gayatri Balasamy, 2025 INSC 605
Read the Supreme Court judgment — Saisudhir Energy, 2026 INSC 103
Arbitration and Conciliation Act, 1996 — India Code
Why did Gayatri Balasamy matter?
The controversy arose because Section 34 expressly speaks of “setting aside” an arbitral award; it does not expressly use the words “modify” or “vary.” This had led to competing lines of Supreme Court authority.
Earlier, Project Director, NHAI v. M. Hakeem, (2021) 9 SCC 1, was generally understood as establishing that a Section 34 court could set an award aside but could not modify it like an appellate court. At the same time, other Supreme Court decisions had, in particular circumstances, modified awards or upheld modifications.
The Constitution Bench in Gayatri Balasamy was therefore asked whether Sections 34 and 37 contain any power of modification at all. The four-judge majority answered yes, but only as a limited power operating within the boundaries of Section 34. The court expressly maintained the distinction between judicial review of an award and an appeal on facts or law. Supreme Court of India
For a broader explanation of why arbitration has much narrower court review than ordinary litigation, see Law Wallet's Arbitration vs Litigation in India: Choosing the Right Forum for Your Dispute.
When can a court modify an arbitral award after Gayatri Balasamy?
The safest way to understand Gayatri Balasamy is that modification remains the exception, not the normal remedy.
Situation
Can the court interfere with the award?
Important limitation
Invalid part is completely severable from the valid part
Yes
The portions must be legally and practically separable
Clerical, computational or typographical mistake
Yes
The error should be apparent from the record and should not require a merits enquiry
Pendente lite interest is contrary to the contract
Court can intervene, but not simply rewrite it as it wishes
Gayatri identified setting aside that rate or using Section 34(4) as the available routes
Post-award interest
Yes, in appropriate circumstances
Modification requires compelling and well-founded reasons
Application of a contractual formula to established facts
May be permissible
Saisudhir Energy permits this where no fresh merits examination is undertaken
Reassessment of evidence or fresh calculation based on a different factual view
No
Section 34 is not an appeal
Modification under Article 142
Supreme Court only
Must be used cautiously and cannot become a merits-based rewriting of the award
The majority's formal conclusion identified severance, correction of obvious clerical/computational/typographical errors, modification of post-award interest in some circumstances, and the Supreme Court's Article 142 jurisdiction. Supreme Court of India
The later judgment in Saisudhir Energy is important because it demonstrates how the broader reasoning in paragraphs 40–46 of Gayatri Balasamy operates in practice: a modification may survive where it follows from applying the contract to the facts already established, without the court conducting a new merits determination. Sci API
What did Gayatri Balasamy not change?
Most importantly, Section 34 remains a supervisory remedy, not an appellate proceeding.
A court cannot reopen an award merely because it believes another conclusion would have been preferable. It cannot reweigh evidence, reassess witnesses, redo factual findings or substitute its own merits determination for that of the arbitral tribunal.
That limitation is particularly important where a party asks a court to “correct” the amount awarded. A difference of opinion about damages is not automatically a computational error. If reaching the new amount requires fresh evidence, reassessment of disputed facts or a new merits analysis, the proposed exercise is ordinarily outside the limited modification jurisdiction recognised by Gayatri Balasamy. The statute itself also makes clear, in the context of patent illegality under Section 34(2A), that an award cannot be set aside merely because of an erroneous application of law or by reappreciating evidence. Supreme Court of India
Nor does Section 37 create a second merits appeal. The appellate court's jurisdiction remains tied to the limited nature of Section 34 review. This became especially clear in Saisudhir Energy, where the Supreme Court disapproved the Section 37 court's decision to rework the compensation after the Section 34 court had arrived at a permissible determination. Indian Kanoon
What usually goes wrong in Section 34 petitions
Section 34 petitions often go wrong when parties use them to reargue the entire dispute instead of identifying a specific legal ground for challenging the award. Simply disagreeing with the tribunal’s interpretation of the contract, assessment of evidence or calculation of damages is not enough. A successful challenge requires the party to demonstrate how the award falls within the limited grounds for judicial interference under Section 34. Courts are not expected to correct every error or revisit every finding; their role is to determine whether the award suffers from a defect that the law recognises as a ground for setting it aside or, in limited circumstances, modifying it.
What does “severing” an arbitral award mean?
Severance means that an unlawful or vulnerable part of an award may be removed while an independent, valid part is preserved.
Suppose an arbitral tribunal decides two independent claims. Claim A is legally sustainable, while Claim B falls outside the tribunal's authority. If Claim B can be removed without changing the reasoning, liability or amount relating to Claim A, the court may be able to set aside only Claim B.
The position is different if the two findings are so interdependent that removing one would require the court to reconstruct the other. Severance cannot be used as a disguised method of rewriting the arbitral tribunal's decision.
This principle also reflects the text of Section 34(2)(a)(iv), which expressly contemplates partial setting aside where decisions falling outside the submission to arbitration can be separated from decisions properly submitted to arbitration. Supreme Court of India
Can courts correct calculation or typing mistakes in an arbitral award?
Yes. Gayatri Balasamy confirms that a Section 34 court may correct clerical, computational or typographical errors apparent on the face of the record. Supreme Court of India
There is an important distinction between correcting an error and deciding a disputed issue again. For example, if the award correctly records five invoices of ₹10 lakh each but accidentally totals them as ₹40 lakh, an obvious arithmetic correction may fall within the permitted category. But if deciding the correct amount requires the court to determine which invoices were legally payable, that is no longer a simple computational correction.
Businesses should also remember that Section 33 is specifically designed for these types of post-award corrections. Unless the parties have agreed to another period, a party may, within 30 days of receiving the award, ask the arbitral tribunal to correct computational, clerical, typographical or similar errors. Section 33 also permits an additional award, generally on a request made within 30 days, where a claim presented in the arbitration was omitted from the award. Supreme Court of India
Can courts change the interest awarded by an arbitrator?
It depends on which period of interest is being challenged.
For interest for the period before the award—often called pendente lite interest—Section 31(7)(a) applies. Gayatri Balasamy held that where such interest violates a contractual provision, the Section 34 court may set aside the offending rate or resort to Section 34(4), rather than simply substituting whatever rate the court considers preferable. Supreme Court of India
Post-award interest under Section 31(7)(b) is different. The Constitution Bench held that a court may modify post-award interest when the facts justify intervention. That can include an increase or decrease, but the Court cautioned that alteration requires compelling and well-founded reasons. Supreme Court of India
Where the award does not itself direct otherwise, Section 31(7)(b) provides the statutory rule that the sum awarded carries interest at 2% above the “current rate of interest” prevalent on the date of the award, from the date of the award until payment. Supreme Court of India
So, Gayatri Balasamy should not be read as giving courts a free-standing power to rewrite every interest component of an award.
What is the role of Section 34(4)?
Section 34(4) can sometimes save a curable award from being set aside.
Where appropriate, the court may adjourn the Section 34 proceedings and give the arbitral tribunal an opportunity to resume proceedings or take action that could eliminate the identified ground for setting aside the award. The provision is therefore fundamentally different from a court itself retrying the dispute.
Gayatri Balasamy also clarified an important procedural point: a request under Section 34(4) does not necessarily have to be in writing. An oral request can be sufficient if the court records it. The majority also recognised the Section 37 court's ability to use the statutory remand mechanism within the limits of the Act. Supreme Court of India
As a practical precaution, however, making the request clearly in writing is normally sensible. That is a litigation strategy point—not an additional statutory condition.
How quickly must a Section 34 challenge be filed?
A Section 34 application ordinarily has to be made within three months from the date the party receives the arbitral award. If a valid Section 33 request has been made, the three-month period runs from the date that request is disposed of by the arbitral tribunal.
Where sufficient cause is shown, the court may entertain the challenge during a further period of 30 days, but not thereafter. Supreme Court of India
That limitation rule is strict. A party considering whether to seek correction, severance, modification or setting aside should therefore review the award immediately rather than wait for negotiations or enforcement proceedings to begin.
What did Saisudhir Energy add in 2026?
Saisudhir Energy provides the most important Supreme Court application of Gayatri Balasamy so far.
The arbitral tribunal had awarded approximately ₹1.2 crore in liquidated damages. In Section 34 proceedings, the Delhi High Court enhanced the compensation to approximately ₹27.06 crore. In appeal under Section 37, the Division Bench recalculated it and reduced the amount to approximately ₹20.70 crore. Indian Kanoon
At first sight, an increase from ₹1.2 crore to ₹27.06 crore may appear inconsistent with the idea of “limited” modification. But the Supreme Court focused on how the modification was reached. It held that the Section 34 court's exercise was permissible because it involved applying Clause 4.6.2 of the Power Purchase Agreement to the facts without undertaking a fresh examination of the merits. Sci API
The Supreme Court, however, did not approve the Section 37 court independently reworking the amount again. The Section 34 determination was restored.
The practical lesson is significant: after Gayatri Balasamy and Saisudhir Energy, the question is not merely whether the court has changed a number in the award. A central enquiry is whether the modification can be made without fresh fact-finding, reappreciating evidence or substituting a new merits decision.
Saisudhir Energy should therefore be treated as an application of Gayatri Balasamy's narrow modification principle—not as authority for routinely asking Section 34 courts to recalculate arbitral awards.
What should a party check before asking a court to modify an award?
Before framing a Section 34 challenge, counsel should generally check:
Identify the precise statutory ground under Section 34 instead of merely alleging that the arbitrator was “wrong.”
Determine whether the defective portion can genuinely be severed without changing the remaining findings.
Ask whether the proposed correction is apparent from the record or would require fresh fact-finding.
Distinguish pre-award or pendente lite interest from post-award interest.
Consider whether Section 33 or the curative mechanism under Section 34(4) is more appropriate.
Calculate the Section 34(3) limitation period immediately and preserve proof of the date on which the signed award was received.
In a Section 37 appeal, avoid framing the case as another opportunity to recalculate damages or retry the dispute.
For businesses reviewing arbitration clauses before a dispute arises, Law Wallet's 5 Clauses Every Commercial Contract in India Must Have Before You Sign discusses dispute-resolution drafting in the broader contractual context. Law Wallet's Commercial Disputes & Arbitration practice overview also explains the stages at which arbitration and award-enforcement issues typically arise.
Can a Section 34 court increase the amount awarded?
Potentially, but not merely because it considers the arbitrator's figure too low. The 2026 Saisudhir Energy judgment upheld an enhancement because the court could apply the relevant contractual clause without undertaking a new merits enquiry. A proposed enhancement requiring reappreciation of evidence would stand on a very different footing. Sci API
Can a Section 34 court reduce the amount awarded?
The same principle applies. A court does not have a general power to substitute its preferred figure. Any modification must remain within the limited jurisdiction recognised by Gayatri Balasamy and subsequent Supreme Court authority.
Can a court correct an obvious arithmetic mistake?
Yes. An apparent computational, clerical or typographical mistake is one of the categories expressly recognised by the Constitution Bench. Section 33 should also be considered promptly because it specifically enables the tribunal to correct such errors. Supreme Court of India
Can a court change pendente lite interest?
Not through an unrestricted power to select a new rate. Where pendente lite interest violates the contract, Gayatri Balasamy identified setting aside the offending interest rate or using Section 34(4) as the available courses. Supreme Court of India
Can a court change post-award interest?
Yes, in appropriate cases. The Constitution Bench held that post-award interest may be increased or decreased where justified, but courts should interfere only for compelling and well-founded reasons. Supreme Court of India
Does a Section 37 court have wider powers than a Section 34 court?
No. Section 37 is not an unrestricted merits appeal against the arbitral award. Its jurisdiction remains controlled by the statutory framework governing challenges to awards, and Saisudhir Energy specifically cautions against recalculating compensation merely because the appellate court prefers another figure. Indian Kanoon
Must a Section 34(4) request always be made in writing?
No. The Gayatri Balasamy majority clarified that an oral request may be entertained if it is recorded by the court. As a matter of litigation practice, putting the request in writing may nevertheless avoid later disputes about what was sought. Supreme Court of India
What if the arbitral tribunal forgot to decide a claim?
Section 33(4) allows a party, unless otherwise agreed, to request an additional arbitral award concerning a claim that was presented during the arbitration but omitted from the award. The request is ordinarily to be made within 30 days of receiving the award. Supreme Court of India
Does M. Hakeem no longer matter after Gayatri Balasamy?
It still matters for the fundamental principle that Section 34 is not a normal appellate jurisdiction. What Gayatri Balasamy changed is the absolute proposition that a court can never modify an award. The binding majority now recognises a limited modification jurisdiction while preserving the prohibition against merits-based rewriting of arbitral decisions. Supreme Court of India
The practical takeaway
Gayatri Balasamy did not give Indian courts a general licence to rewrite arbitral awards. It created a narrow corrective space within Sections 34 and 37 while keeping the basic architecture of arbitration intact.
The clearest cases remain severable portions of an award, obvious clerical or computational mistakes and appropriate modifications of post-award interest. Article 142 remains a special power of the Supreme Court.
The 2026 decision in Saisudhir Energy adds an important practical dimension: a modification may also survive where it follows from applying the contractual framework to the established facts without reopening the merits. But once a court begins reconsidering evidence, making fresh factual findings or independently reassessing the dispute, it risks crossing the boundary between limited judicial review and an impermissible appeal.
For businesses and counsel, therefore, the better question after an unfavourable award is no longer simply, “Can we ask the court to change it?” It is: “Can the defect be corrected within Section 34 without asking the court to decide the arbitration again?”
