Mandate Of An Arbitrator Can Be Extended Even After Termination Of Mandate

Ashok Kumar Gupta v M.D. Creations And Ors¹

The Calcutta High Court held that the Court is empowered to extend an arbitrator's mandate even if the application for an extension under §29A of the Arbitration Act 1996 is filed after the arbitrator's mandate has expired.

Decision

To arrive at the decision, the Court conducted a detailed analysis of provisions of the Arbitration Act, along with the Law Commission Report which recommended introduction of §29A, by amending the Arbitration Act. The following sub-issues were framed and answered:

1. Whether §29A debars an application from being filed after termination of the mandate: The Court held that the text of the provision did not stipulate that an application had to be made before termination. Hence, it was not the intention of the legislature to put in such a restriction. Additionally, since §29A provides that the Court can reconstitute the tribunal while extending the mandate, by necessary implication, it should mean that the mandate of the previous is terminated, and a new tribunal is constituted.
2. Whether the court's power to extend the mandate is taken away if the application for extension is filed after termination: The Court noted that the language of §29A(4) is clear and unambiguous in stating that extension of the mandate is not linked with the filing of the application but is left to the discretion of the court.
3. Effect of the 176th Report of the Law Commission of India on the introduction of §29A to the Arbitration Act: The Court compared the text of the recommendation in the Report along with the statute as it stands and held that the schemes were cardinally the same. The Court noted that while the law commission recommendation was that after expiry of mandate, the proceedings would "stand suspended" until an application was filed, the actual amendment shifted the focus to the Court extending the mandate.
4. Purpose of §29A of the Arbitration Act: The Court noted that a strict interpretation of §29A would be counterproductive to the object of the Arbitration Act and paradoxical to its intent. In case the Court's power to extend is curtailed, it could lead to a situation where a recalcitrant party could frustrate the arbitration by delaying the proceedings.

Conclusion

The Court held that a comprehensive reading of the §29A of the Arbitration Act indicates that the court's power to extend the mandate of an arbitrator is not taken away or curtailed merely if an application for extension is filed beyond the statutory timeline. There are sufficient checks and balances for such an extension which have been sufficiently provided to encourage and facilitate the arbitral way of dispute resolution.

Footnote

1. 2024 SCC OnLine Cal 6909

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