Court Empowered To Extend Mandate Of Arbitral Tribunal Even After Its Expiry: Delhi High Court

Section 29A(4) of the Arbitration and Conciliation Act, 1996 pertains to the extension of the time period for arbitral tribunals to make their awards. This section gives courts the power to extend the mandate of the arbitral tribunal beyond the originally specified period.

Brief Facts:

Narsingh Decor, the counter-claimant, approached the Delhi High Court and filed an application under Section 29A of the Arbitration & Conciliation Act, 1996 (“Arbitration Act”) read with Section 151 of the CPC. In this application, Narsingh Decor sought an extension for the conclusion of the arbitration proceedings.

Initially, M/s SS Steel Fabricators & Contractors (Claimant) filed a claim before the Arbitral Tribunal, but this claim was terminated on May 10, 2023. Despite the termination, Narsingh Decor raised a counter-claim, which M/s SS Steel Fabricators & Contractors proceeded against ex parte. The pleadings for the counter-claim were completed on March 15, 2023, and Narsingh Decor diligently pursued the matter before the Arbitral Tribunal without any intent to cause delay.

Narsingh Decor contended that due to the ex parte proceedings, they had to bear the fee expenses that would typically be shared by the claimant, M/s SS Steel Fabricators & Contractors.

Given these circumstances, Narsingh Decor prayed for a suitable extension of the period to conclude the arbitration proceedings.

Observations by the High Court:

The High Court found no evidence indicating any deliberate attempt by Narsingh Decor to delay the proceedings. It held that the delay appeared to be caused by the non-cooperation of the claimant, M/s SS Steel Fabricators & Contractors, who failed to appear despite being served with several notices.

It held that the arbitration proceedings should have been concluded within twelve months following the completion of pleadings in the counter-claim. There was a delay beyond this stipulated period. However, referring to its decision in M/S Power Mech Projects Ltd Vs M/S Doosan Power Systems India Pvt. Ltd., 2024 LiveLaw (Del) 654, the High Court held that under Section 29A(4) of the Arbitration Act, the court has the authority to extend the mandate of the Arbitral Tribunal either before or after the expiry of the specified period.

Given the detailed reasons provided in Narsingh Decor's application, the High Court decided to extend the mandate of the Arbitral Tribunal until June 30, 2024.

Case Title: Ss Steel Fabricators and Contractors vs Narsing Decor

Citation: 2024 LiveLaw (Del) 729

Case Number: ARB.P. 882/2022

Advocate for the Petitioner: Mr. Bhuvneshwar Tyagi, Ms. Shaiza Gyaspuri

Advocate for the Respondent: Mr. Anand Duggal

Date of Judgment: 19.06.2024

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