Content Provider | Supreme Court of India |
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e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | ss. 14 and 15 Failure or impossibility to act Arbitration and Conciliation Act 1996 Arbitration agreement |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Allowed |
Headnote | Arbitration and Conciliation Act 1996: ss. 14 and 15 – Failure or impossibility to act – Arbitration agreement – In terms of the conditions, arbitrator to make award within four months from the date of service of copy of the agreement, however this period could be extended with the consent of the parties – Arbitrator unable to complete the arbitral proceedings within four months from the date of the first preliminary meeting in terms of the arbitration agreement and appellants refused to provide consent to extension of time – Issuance of direction by the tribunal to respondent No 1 to obtain extension of time or to approach court for a clarification – However, no application filed by respondent no. 1 – Thereafter, arbitrator fixed a meeting, however, appellants filed an application that the tribunal had become functus officio with no power to proceed as the four-month period had expired – Rejection of the application by the arbitrator – Appellant then filed arbitration petition invoking s. 14 – Declaration sought that the arbitrator had become de jure unable to perform his functions and mandate to act as arbitrator had terminated – Dismissed by the High Court – On appeal, held: It is clear from the reading of sub-section 1(a) of s. 14 that mandate of an arbitrator shall terminate if it fails to act without undue delay – Arbitration proceedings are supposed to be governed and run by the terms as agreed by the parties, failing which it would frustrate the mandate of the object of the Act – Thus, the arbitrator, cannot go beyond the clause of the arbitration agreement – Parties have to stand by the terms of contract including the Arbitrator – On facts, it cannot be held that there has been a waiver of valuable rights where the circumstances show that what was done was involuntary – Furthermore, there is no provision under the arbitration agreement to condone the delay when agreement between the parties binds them to see that the arbitration proceedings should be concluded within the time prescribed – s. 14 read with s. 15 also recognise this mechanism – After the expiry of four months period from the date of first preliminary meeting, the Arbitrator indeed became de jure unable to perform his functions and the mandate to act as an Arbitrator in the arbitral proceedings between the parties stood terminated – Thus, the order passed by High Court is set aside. |
Judge | Hon'ble Mr. Justice Ajay Rastogi |
Neutral Citation | 2019 INSC 958 |
Petitioner | Jayesh H. Pandya & Anr. |
Respondent | Subhtex India Ltd. & Ors. |
SCR | [2019] 11 S.C.R. 765 |
Judgement Date | 2019-08-27 |
Case Number | 6300 |
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