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1
Sec 15 of the 2016 Amendment act.
2
See section 3 read with the First Schedule of the Arbitration Act, 1940.
Section 3- Provisions implied in arbitration agreement- An arbitration agreement, unless a
different intention is expressed therein, shall be deemed to include the provisions set out in the
First Schedule in so far as they are applicable to the reference.
Rule 3, First Schedule- The arbitrators shall make their award within four months after entering
on the reference or after having been called upon to act by notice in writing from any party to the
arbitration agreement or within such extended time as the Court may allow.
3
Shyam Telecom Ltd. vs Arm Ltd, 2 004 (3) ARBLR 146 Delhi, 2004 (77) DRJ 91 Para 17- “It is
true that 1996 Act does not prescribe any time limit for making and publishing the Award but
that does not mean that parties cannot by mutual agreement provide for a time limit for making
the Award by the Arbitrator and if so prescribed it would run contra to the provisions of the Act.
This view appears to be more plausible and acceptable having regard to the object of having
Arbitration as the alternate mode for settlement of disputes/differences between the parties.”
4
28. Power to Court only to enlarge time for making award.
(1) The Court may, if it thinks fit, whether the time for making the award has expired or not and
whether the award has been made or not, enlarge from time to time the time for making the award.
(2) Any provisions in an arbitration agreement whereby the arbitrators or umpire may, except with
the consent of all the parties to the agreement, enlarge the time for making the award, shall be void
and of no effect.
One view is that this is on account of the absence of a provision as to
time limit for passing an award.5
5
176th Law Commission Report, Page 122
Section. 29 A (1)
6
The Arbitration Amendment Bill, 2018 proposes the following substitution to s. 29A (1)-
"(1) The award in matters other than international commercial arbitration shall be made within a
period of twelve months from the date of completion of pleadings under sub-section (4) of section
23."; Thus, the time period shall begin to run from the point when parties have completed their
pleadings. Thus, it seems that the legislature wishes to give a years’ time to the Arbitral Tribunal
to deliberate and decide upon the issues, as opposed to quickly wrap up the proceedings. This
proposed amendment requires to be reconsidered. The term “completion of pleading” is vague.
Further, parties are free, with the leave of the Tribunal, to amend their pleadings. As such, it
would be open for unscrupulous litigators to employ dilatory tactics and keep extending their
pleadings indefinitely. The Act does not specifically authorize the Arbitrator to compel a Party to
quickly wrap up its pleadings.
7
S 2. (C), Arbitration Act, 1996 “arbitral award” includes an interim award; whereas the
old Act specified that ‘“award” means an arbitration award”
8
Termination of proceedings.—
(1) The arbitral proceedings shall be terminated by the final arbitral award or by an order of the
arbitral tribunal under sub-section (2).
(2) The arbitral tribunal shall issue an order for the termination of the arbitral proceedings
where—
(a) the claimant withdraws his claim, unless the respondent objects to the order and the arbitral
tribunal recognises a legitimate interest on his part in obtaining a final settlement of the dispute,
(b) the parties agree on the termination of the proceedings, or
(c) The arbitral tribunal finds that the continuation of the proceedings has for any other reason
become unnecessary or impossible.
limit also applies to International Commercial Arbitrations seated
in India. The Arbitration and Conciliation (Amendment) Bill of
2018 will exempt International Commercial Arbitrations from any
time limits.9
(3) Subject to section 33 and sub-section (4) of section 34, the mandate of the arbitral tribunal
shall terminate with the termination of the arbitral proceedings.
9
Section 6 of the Arbitration and Conciliation (Amendment) Bill, 2018-
“In section 29A of the principal Act,—
(a) for sub-section (1), the following sub-section shall be substituted, namely:—
"(1) the award in matters other than international commercial arbitration shall be made within a
period of twelve months from the date of completion of pleadings under sub-section (4) of section
23.”
10
Article 21. Commencement of arbitral proceedings- Unless otherwise agreed by the parties, the
arbitral proceedings in respect of a particular dispute commence on the date on which a request
for that dispute to be referred to arbitration is received by the respondent.
rendered void.1112 If the challenge fails, then the date of
appointment stands.13 However, if the challenge succeeds and a
new arbitrator is appointed, then s. 15 (4) comes into effect, which
states-
“Unless otherwise agreed by the parties, an order or ruling of
the arbitral tribunal made prior to the replacement of an
arbitrator under this section shall not be invalid solely because
there has been a change in the composition of the arbitral
tribunal.”
Further, s. 15 (3) states-
“(3) Unless otherwise agreed by the parties, where an
arbitrator is replaced under sub-section (2), any hearings
previously held may be repeated at the discretion of the arbitral
tribunal.”
Thus, if an Arbitrator is substituted, then the previous proceedings
are not held to be void.
11
Jimmy Construction Pvt. Ltd. V UoI, 2008 (2) Arb LR 591 (Bom)
12
Haresh Chinnubhai Shah v Rajesh Prabhakar Jhaveri, 2004 (1) Arb LR 536 (Bom)
13
The Observations of the Delhi High Court in Newton Engineering and Chemicals v IOL 2006
(4) Arb LR 257 (para 24) -
“To conclude, I have no hesitation in holding that there is no provision in the Act
empowering this Court to terminate the mandate of the Arbitrator who has entered upon the
reference and/or to substitute the same with an Arbitrator appointed by this Court. The necessary
corollary is that the challenge to the appointment of the Arbitrator must be raised by the
petitioner before the Arbitral Tribunal itself. If such challenge succeeds, the petitioner shall have
no cause for grievance left. If, however, the petitioner is unable to succeed before the Arbitral
Tribunal, it shall have no option except to participate in the arbitral proceedings and if aggrieved
by the arbitral award, to challenge the same in accordance with the provisions of Section 34 of
the Act.”
he could proceed to the Court at that stage, instead of waiting for a
final award. However, s. 13 (4), (5) of the Arbitration Act make a
distinct departure from the same. The Parliament, with a view to
prevent the dilatory tactics of an unsuccessful party, has compelled
it to await an award.1415 The inclusion of this provision is also a
departure by the legislature from the old Act of 1940, where the Court
was empowered to remove arbitrators or umpire.16
14
Harike Rice Mills v State of Punjab, 1997 (Sup) Arb LR 342
15
Assam Urban Water Supply and Sewerage Scheme v Subhash Projects and Marketing Ltd. AIR
2003 Gau 146
16
See S 11, Arbitration Act, 1940-
11. Power of Court to remove arbitrators or umpire in certain circumstances.
(1) The Court may, on the application of any party to reference, remove an arbitrator or umpire
who fails to use all reasonable dispatch in entering on and proceeding with the reference and
making an award.
(2) The Court may remove an arbitrator or umpire who has misconduct himself or the
Proceedings.
(3) Where an arbitrator or umpire is removed under this section, he shall not be entitled to
receive any remuneration in respect of his services.
(4) For the purposes of this section the expression “proceeding with the reference” includes, in
a case where reference to the umpire becomes necessary, giving notice of that fact to the parties
and to the umpire.
17
Article 31 Time Limit for the Final Award
1. The time limit within which the arbitral tribunal must render its final award is six
months. Such time limit shall start to run from the date of the last signature by the
arbitral tribunal or by the parties of the Terms of Reference or, in the case of application
of Article 23(3), the date of the notification to the arbitral tribunal by the Secretariat of
the approval of the Terms of Reference by the Court. The Court may fix a different time
limit based upon the procedural timetable established pursuant to Article 24(2).
2. The Court may extend the time limit pursuant to a reasoned request from the arbitral
tribunal or on its own initiative if it decides it is necessary to do so.
https://cdn.iccwbo.org/content/uploads/sites/3/2017/01/ICC-2017-Arbitration-and-2014-
Mediation-Rules-english-version.pdf.pdf
In case the first time period of one year runs out and one or both
parties do not consent to the extension of the proceedings, the
Arbitrator / Tribunal shall terminate the proceedings. This
termination cannot be challenged in anyway except by a petition
under section 34 of the Act. 1819
18
In The India Trading Company vs. Hindustan Petroleum Corporation Ltd. 2016 SCC Online Cal
479, a Division Bench of the Calcutta HC has held-
"13. There is a difference between a decision which puts an end to the arbitral proceedings and
a decision whereby the arbitrator withdraws from the proceedings. Where the arbitrator
withdraws from the proceedings, a substitute arbitrator may appointed in accordance with the
procedure, applicable to the appointment of the arbitrator who is replaced, but where the
arbitrator puts an end to the arbitral proceedings, the claimant cannot pursue his claim.
14. The decision of the arbitral tribunal to put an end to the proceedings is a final award which
can only be challenged by way of an application for settling aside under Section 34 Sub-section
(2) of the 1996 Act. Once the arbitral proceedings are terminated, the claimant cannot re-agitate
the same claim by initiation of fresh proceedings since the claim would be hit by principles of
constructive res judicata.”
19
Angelique International Limited vs SSJV Projects Private Limited & Anr, O.M.P. (T) (COMM.)
91/2017 & I.A. Nos.13595/2017, 14086/2017
Section. 29A (2)
The language used here is, “as the parties may agree” and not “as the
parties have agreed”. This implies that there need be no prior
agreement of the parties to the Arbitration with regard to the fee
payable to the arbitrators if the award is made within 6 months. The
parties are thus bound to, in concert, agree to the additional fee
payable.20
20
The Arbitration (Amendment) Bill, 2018 proposes an amendment in sec. 11-
“(14) The arbitral institutions shall determine the fees of the arbitral tribunal and the manner of
its payment to the arbitral tribunal subject to the rates specified in the Fourth Schedule.”
Explanation.—For the removal of doubts, it is hereby clarified that this sub-section shall not apply
to international commercial arbitration and in arbitrations (other than international commercial
arbitration) where parties have agreed for determination of fees as per the rules of an arbitral
institution.’
by such Court, as the case may be, as expeditiously as possible
and an endeavour shall be made to dispose of the matter within
a period of sixty days from the date of service of notice on the
opposite party.
(14) For the purpose of determination of the fees of the arbitral
tribunal and them manner of its payment to the arbitral
tribunal, the High Court may frame such rules as may be
necessary, after taking into consideration the rates specified in
the Fourth Schedule.
21
Section 39 (4)
“The Court may make such orders as it thinks fit respecting the costs of the arbitration where any
question arises respecting such costs and the arbitral award contains no sufficient provision
concerning them”.
22
S. 11 (14) as proposed in the 2018 Amendment bill-
“The arbitral institutions shall determine the fees of the arbitral tribunal and the manner of its
payment to the arbitral tribunal subject to the rates specified in the Fourth Schedule.
Explanation.—For the removal of doubts, it is hereby clarified that this sub-section shall not apply
to international commercial arbitration and in arbitrations (other than international commercial
arbitration) where parties have agreed for determination of fees as per the rules of an arbitral
institution.”
[THE FOURTH SCHEDULE]23
23
24
Proposed Section 29A (7)-
“The parties cannot by consent, extend the period beyond the period specified in sub-section
(1) and the maximum period referred to in sub-section (2) and save as otherwise provided
in the said sub-sections, any provision in an arbitration agreement whereby the arbitral
tribunal may further extend the time for making the award, shall be void and of no effect.”
Section. 29A (4)
25
The Arbitration Amendment Bill, 2018 proposes the following amendment to s. 29A (4)
“in sub-section (4), after the proviso, the following provisos shall be inserted, namely:—
"Provided further that where an application under sub-section (5) is pending, the mandate of the
arbitrator shall continue till the disposal of the said application:
Provided also that the arbitrator shall be given an opportunity of being heard before the fees is
reduced."
provided in the main provision of s. 29A (4), then it may be open to
the court to appoint new arbitrators. It is implied that the
Arbitrator(s) shall be substituted by the court if it is found that the
Arbitrator(s) has/have failed to act and adjudicate without undue
delay. This becomes amply clear upon an examination of sub-section
6 of section 29A.26
It should be noted that once an arbitrator’s mandate has been
terminated, he may be appointed again. There is no specific authority
for this proposition, however, the Supreme Court has decided a case
where one of the Parties challenged the appointment of the Arbitrator
on the ground that he had decided a previous dispute in a prior
Arbitration proceeding arising out of the same Contract, involving
identical issues. The ground taken by the Party, among others, was
that the Arbitrator has had “The arbitrator has previous involvement
27
in the case.” This is one of the grounds for challenging the
appointment of an Arbitrator.28 It is also a ground which “gives rise
to justifiable doubts as to the independence or impartiality of
arbitrators.”29 Another ground taken was that if arbitrator has been
appointed as an arbitrator on more than one occasion by a party, such
appointment falls afoul of Clauses 22 and 24 of the Fifth Schedule and
26
“(6) While extending the period referred to in sub-section (4), it shall be open to the Court to
substitute one or all of the arbitrators and if one or all of the arbitrators are substituted, the
arbitral proceedings shall continue from the stage already reached and on the basis of the evidence
and material already on record, and the arbitrator(s) appointed under this section shall be deemed
to have received the said evidence and material.”
27
Arbitration and Conciliation Act, 1996, Seventh Schedule, Clause 16
28
Section 12 (5) Notwithstanding any prior agreement to the contrary, any person whose
relationship, with the parties or counsel or the subject-matter of the dispute, falls under any of the
categories specified in the Seventh Schedule shall be ineligible to be appointed as an arbitrator:
Provided that parties may, subsequent to disputes having arisen between them, waive the
applicability of this sub-section by an express agreement in writing.]
29
See Clause 16, The Fifth Schedule, 1996 Act
therefore it is justified to doubt his impartiality. It is worth noting
that while the Fifth Schedule lays down certain situations where an
Arbitrator’s appointment may be challenged, it is not an absolute
rule. The Seventh Schedule, however, lays down grounds that render
a person “ineligible to be appointed as an arbitrator”.30 This must be
interpreted in light of Explanation 3 to the Seventh Schedule which
says-
30
See ibid, 22
by factors other than the merits of the case in reaching his
or her decision. This test requires taking a broad common-
sensical approach to the items stated in the Fifth and
Seventh Schedules. This approach would, therefore, require
a fair construction of the words used therein, neither
tending to enlarge or restrict them unduly……….”31
31
HRD Corporation v GAIL India Ltd. (Civil Appeal no 11127 of 2017),
32
Ibid, Para 23, 24
refers to the proposed arbitrator. This becomes clear, when
contrasted with Items 22 and 24, where the arbitrator must have
served “as arbitrator” before he can be disqualified. Obviously,
Item 16 refers to previous involvement in an advisory or other
capacity in the very dispute, but not as arbitrator. 33
33
Ibid, Para 16
(4) Unless otherwise agreed by the parties, an order or
ruling of the arbitral tribunal made prior to the
replacement of an arbitrator under this section shall not be
invalid solely because there has been a change in the
composition of the arbitral tribunal”
A combined reading of Sections 15(2) and 29A (4) tells us that if the
mandate of the Arbitrators terminates, then the rules applicable to
the appointment of the initial arbitrator shall be applicable. This, in
turn, means that if the Parties had decided upon the selection
criteria34 and procedure for Arbitrators, such rules and procedures
shall be followed here again. If there is no prior agreement, or the
parties do not agree again as to the procedure, then –
34
Section 11 (2) Subject to sub-section (6), the parties are free to agree on a procedure for
appointing the arbitrator or arbitrators.
35
Section 11 (3)
b. the two appointed arbitrators fail to agree on the third
arbitrator within thirty days from the date of their
appointment,
the appointment shall be made, upon request of a party, by
[the Supreme Court or, as the case may be, the High Court or
any person or institution designated by such Court];36
36
Section 11 (4)
a party may request [the Supreme Court or, as the case may be,
the High Court or any person or institution designated by such
Court] to take the necessary measure, unless the agreement on
the appointment procedure provides other means for securing
the appointment.
37
Section 6, Arbitration and Conciliation (Amendment) Bill, 2018-
“In section 29A of the principal Act,—
………………………..
(b) in sub-section (4), after the proviso, the following provisos shall be inserted,
namely:—
…………………………..
Provided also that the arbitrator shall be given an opportunity of being heard before the fees is
reduced.”
“A charge for labor or services, esp. professional services”38. This view
is supported by the fact that section 31 (8) of the 1996 Act uses the
words “costs”, as well as the word “fees”. Costs of Arbitration
includes the Arbitrator’s fees.39 Article 40, Clause 2 also defines fees
as a sub-set of “costs”.40The Court cannot impose such a deduction,
that it also eats away at the Arbitrators out of pocket expenses and
costs. For example, if the Arbitration is conducted by an Institutional
Arbitrator which also charges rent to let out the office of the
Arbitrators, the court cannot deduct such amount. There are many
expenses associated with Arbitration apart from the fee simpliciter
given to the arbitrator. The Indian Institute of Arbitration and
Mediation has published its Fee Schedule and this may be referenced
here.
Before the deduction of fee, the Court must follow the Principles of
Natural Justice. One of the principles is the rule of audi alterm
38
Page 718
39
Section 31 (8), 1996 Act-
“The costs of an arbitration shall be fixed by the arbitral tribunal in accordance with section 31A.]
Explanation.—For the purpose of clause (a), “costs” means reasonable costs relating to—
(I) the fees and expenses of the arbitrators and witnesses,
(ii) legal fees and expenses,
(iii) any administration fees of the institution supervising the arbitration, and
(iv) any other expenses incurred in connection with the arbitral proceedings and the arbitral
award.”
40
Article 40 (2), UNCITRAL Arbitration Rules, 2010-
2. The term “costs” includes only:
(a) The fees of the arbitral tribunal to be stated separately as to each arbitrator and to be fixed by
the tribunal itself in accordance with article 41;
(b) The reasonable travel and other expenses incurred by the arbitrators;
(c) The reasonable costs of expert advice and of other assistance required by the arbitral tribunal;
(d) The reasonable travel and other expenses of witnesses to the extent such expenses are approved
by the arbitral tribunal;
(e) The legal and other costs incurred by the parties in relation to the arbitration to the extent that
the arbitral tribunal determines that the amount of such costs is reasonable;
(f) Any fees and expenses of the appointing authority as well as the fees and expenses of the
Secretary-General of the PCA.
paterm, which means “hear the other side”. The Court is bound to
give a hearing to the Arbitrator before passing any adverse order
against him, whether for the deduction of fee, or his substitution.
This adds to the amount of time consumed by the judicial
intervention.
141 Section 11 (8) The Supreme Court or, as the case may be, the High Court or the person or
institution designated by such Court, before appointing an arbitrator, shall seek a disclosure in
writing from the prospective arbitrator in terms of sub-section (1) of section 12, and have due
regard to—
(a) any qualifications required for the arbitrator by the agreement of the parties;
the 1940 Act. It may be true that Arbitrations may have been wrapped
up faster in earlier times, but correlation does not equate to
causation. Arbitrations today are far more common that Court
litigations, especially in Commercial Contracts where complex trade
deals are involved. In such deals, the Contracts alone often run into
hundreds, if not thousands of pages. This is a clear indicator of the
increase in complexity of today’s commercial disputes. When such
complicated matters are to be adjudicated, it is only natural for the
proceedings to take their time. In order to do complete justice, the
Arbitrators must pay attention to all the materials and arguments
advanced by the parties. It is not reasonable to assume that the
Arbitrators are not working expeditiously, the relevant
circumstances must be taken into context.
The 1996 Act remains silent as to what happens when the time has
run out while an application for extension is pending with the court.
The 176th Law Commission in its Report, suggested that in such a
situation, Arbitration proceedings should be allowed to continue.4243
Further, the Commission was of the opinion that if the proceedings
have not been concluded even after an extension by the Court, they
should be allowed to continue.44
42
Page 124., Para 2.21.3
43
Proposed Section 29A (4)-
“Pending consideration of the application for extension of time before the Court under sub section
(3), the arbitration proceedings shall continue before the arbitral tribunal and the Court shall not
grant any stay of the arbitral proceeding”
44
176th Report, page 125, Para 2.21.5- there is no point in terminating the arbitration
proceedings. We propose it as they should be continued till award is passed. Such a termination
may indeed result in waste of time and money for the parties after lot of evidence is led. In fact,
if the proceedings were to terminate and the claimant is to file a separate suit, it will even become
necessary to exclude the period spent in arbitration proceedings, if he was not at fault, by
It is not explicitly stated in the Act what would happen if no party
applies to the court to extend time. The 176th Commission’s view was
that In order that there is no further delay, after the period of initial
one year and the further period agreed to by the is over, the
arbitration proceedings will stand suspended and will get revived as
soon as any party to the proceedings files an application in the Court
for extension of time. In case none of the parties files an application,
even then the arbitral tribunal may seek an extension from the
Court.45 The Arbitration and Conciliation (Amendment) Bill of 2018
makes a very welcome improvement to the existing law by stating
that while the application for an extension is pending decision by the
Court, the Arbitration proceedings shall continue till the application
is disposed of by the Court.46
amending sec. 43(5) to cover such a situation. But the Commission is of the view that there is a
better solution to the problem
45
This suggestion was formulated by the Commission in its proposed version of s. 29A (3)-
“If the award is not made within the period specified in sub-section (1) and the period
agreed to by the parties under sub-section (2), the arbitral proceedings shall, subject to the
provisions of sub-sections (4) to (6), stand suspended until an application for extension is
made to the Court by any party to the arbitration, or where none of the parties makes an
application as foresaid, until such an application is made by the arbitral tribunal.
46 Section 6 of the Arbitration and Conciliation (Amendment) Bill, 2018-
“In section 29A of the principal Act,—
……………………..
(b) in sub-section (4), after the proviso, the following provisos shall be inserted,
namely:—
"Provided further that where an application under sub-section (5) is pending, the mandate of the
arbitrator shall continue till the disposal of the said application:”
Section. 29A (5)
Looking at the provision, it seems clear that the party applying for
extension must show that an extension of time should be granted.
The burden of proof is upon the applicant. “Party” has been defined
in the Act as “party” means a party to an arbitration agreement.
Therefore, the right to apply to a Court for the extension of time is
available only to the parties to the disputes, and not the Arbitrators.
It should be noted that the Law Commission, in its 176th Report stated
that “if the parties do not apply, the arbitrators can also apply for the
same.”47
It should be noted that the phrases “may be granted” and “only for
sufficient cause” has also been used here. “Sufficient cause” has also
been used in section 5 of the Limitation Act.48 Thus, this provision
47
Page 17, 176th Law Commission Report
48
5. Extension of prescribed period in certain cases.—Any appeal or any application, other than
an application under any of the provisions of Order XXI of the Code of Civil Procedure, 1908 (5 of
1908), may be admitted after the prescribed period if the appellant or the applicant satisfies the
court that he had sufficient cause for not preferring the appeal or making the application within
such period.
gives the Court a wide amount of discretion and places a heavy
burden upon the applicant. The use of the word “only” ensures that
the court can grant an extension under a limited set of circumstances.
It is possible that lengthy proceedings in courts may ensue in order
to convince the Court of the validity and existence of “sufficient
cause”. The parties may be faced with the need to lead a large amount
of evidence and arguments in order to get an extension. As with other
previously discussed provisions in the Act which necessitate judicial
intervention, there is a specific requirement given in this sub-section
for the courts to decide the application in an expeditious manner, as
well as a recommended disposal time (60 days from the date of
service of notice on the opposite party).
Explanation.—The fact that the appellant or the applicant was missed by any order, practice or
judgment of the High Court in ascertaining or computing the prescribed period may be sufficient
cause within the meaning of this section.
There is also an unintended consequence of this sub-section. In order
to adjudicate upon the sufficiency of cause for extension of time, one
of the most common reasons may be the inherent complexity of the
dispute or the technical nature of the underlying contract, or even the
time taken by an expert to make his observations and give his
evidence. All of these reasons ensure that the parties must place on
the Court’s record a lot of material which may otherwise be highly
confidential. For example, a lot of joint-ventures or technology
transfer agreements involve intellectual property and trade secrets
which need to be protected. The confidentiality inherent in
Arbitration proceedings is not present in courts.
It is worth noting that the above provision does not specify the
amount of additional time the Court can grant to the Arbitrator. As
such, it is entirely up to the Courts discretion. While the76th report of
the Law Commission recommended for fixing maxim period for the
court to extend time, the 176th Commission wanted to leave it to the
Court’s discretion. Further, the Court has the ability to impose terms
and conditions. It is very easy to foresee that the court may order an
extension by a relatively short amount of time, say, one month, and
then force the parties to come back to it. Thus, the Court will have a
sort of supervisory jurisdiction over and above the kind envisioned
by the 1996 Act. This is quite clearly against the intention of the
Legislature, as evidenced under section 5 of the Act (for which, there
is no analogous provision in the 1940 Act).
Art.24 (1) of the International Chambers of Commerce Rules, 1998
fixed a period of six months from the date of signature or approval
by the International Court of Arbitration of the terms of reference.
However, the International Court of Arbitration may “pursuant to a
reasoned request from the arbitrator or if need be on its own
initiative, extend the time limit if it decides, it is necessary to do so
(Art. 24(2). Where an excessive delay is attributable to the
arbitrators, the International Court of Arbitration may resort to the
provisions of the Rules concerning the replacement of arbitrators,
which apply where the arbitrators fail to perform their duties within
the stipulated time limits.49
49
See Art. 12 (2) of the ICC Rules, 1998
(3) The court shall only make an order if satisfied that a
substantial injustice would otherwise be done.
(4) The court may extend the time for such period and on such
terms as it thinks fit, and may do so whether or not the time
previously fixed (by or under the agreement or by a previous
order) has expired.
(5) The leave of the court is required for any appeal from a
decision of the court under this section”
50
79 Power of court to extend time limits relating to arbitral proceedings.
(1) Unless the parties otherwise agree, the court may by order extend any time limit agreed
by them in relation to any matter relating to the arbitral proceedings or specified in any
provision of this Part having effect in default of such agreement. This section does not
apply to a time limit to which section 12 applies (power of court to extend time for
beginning arbitral proceedings, &c.).
(2) An application for an order may be made—
a. by any party to the arbitral proceedings (upon notice to the other parties and to
the tribunal), or
b. by the arbitral tribunal (upon notice to the parties).
(3) The court shall not exercise its power to extend a time limit unless it is satisfied—
a. that any available recourse to the tribunal, or to any arbitral or other institution
or person vested by the parties with power in that regard, has first been
exhausted, and
b. that a substantial injustice would otherwise be done.
(4) The court’s power under this section may be exercised whether or not the time has
already expired.
(5) An order under this section may be made on such terms as the court thinks fit.
(6) The leave of the court is required for any appeal from a decision of the court under this
section.
(d) the manner in which proceedings were conducted by the
arbitral tribunal;
(e) the further work involved;
(f) the amount of money already spent by the parties towards
fee and expenses of arbitration;
(g) any other relevant circumstances,
Section. 29A (6)
51
Section 29A (9)-
“An application filed under sub-section (5) shall be disposed of by the Court as expeditiously as
possible and endeavour shall be made to dispose of the matter within a period of sixty days from
the date of service of notice on the opposite party.”
52
Section. 11 (13)-” An application made under this section for appointment of an arbitrator or
arbitrators shall be disposed of by the Supreme Court or the High Court or the person or institution
designated by such Court, as the case may be, as expeditiously as possible and an endeavour shall
be made to dispose of the matter within a period of sixty days from the date of service of notice on
the opposite party.”
Small Causes as well, which may result in a faster appointment. 53
This seems to be a trend since the 1996 Act, as it was originally
drafted, only empowered the Chief Justice of the High Court /
Supreme Court (or his Designee) to make an initial appointment.
It is worth noting that the Act of 1940 also empowered the Court to
substitute Arbitrators when they were the cause of undue delay.
This was to be done upon an application made by a party. Thus, a
Party could initiate subsequent substitution of an Arbitrator, even if
the appointment was valid. Under section 11 (1) of the 1940 Act, it
was stated-
“The Court may, on the application of any party to a reference,
remove an arbitrator or umpire who fails to use all reasonable
dispatch in entering on and proceeding with the reference and
making an award.”
Further, if the arbitrator was removed, he would not have been
entitled to any remuneration.54 Upon such removal, any party could
apply to have the vacant Arbitrator’s post filled.55
53
Section 2 (e)-
“Court” means—
(I) in the case of an arbitration other than international commercial arbitration, the principal Civil
Court of original jurisdiction in a district, and includes the High Court in exercise of its ordinary
original civil jurisdiction, having jurisdiction to decide the questions forming the subject-matter of
the arbitration if the same had been the subject-matter of a suit, but does not include any Civil
Court of a grade inferior to such principal Civil Court, or any Court of Small Causes;
(ii) in the case of international commercial arbitration, the High Court in exercise of its ordinary
original civil jurisdiction, having jurisdiction to decide the questions forming the subject-matter of
the arbitration if the same had been the subject-matter of a suit, and in other cases, a High Court
having jurisdiction to hear appeals from decrees of courts subordinate to that High Court;]
54
Section 11 (3) “Where an arbitrator or umpire is removed under this section, he shall not be
entitled to receive any remuneration in respect of his services”
55
Section 12 (1) Where the Court removes an umpire who has not entered on the reference or one
or more arbitrators (not being all the arbitrators), the Court may, on the application of any party
to the arbitration agreement, appoint persons to fill the vacancies.
(2) Where the authority of an arbitrator or arbitrators or an umpire is revoked by leave of the
Court, or where the Court removes an umpire who has entered on the reference or a sole arbitrator
or all the arbitrators, the Court may, on the application of any party to the arbitration agreement,
either-
(a) appoint a person to act as sole arbitrator in the place of the person or persons displaced, or
(b) order that the arbitration agreement shall cease to have effect with respect to the difference
referred.
Section. 29A (7)
56
This is similar to Section 15 (4) –“Unless otherwise agreed by the parties, an order or ruling of
the arbitral tribunal made prior to the replacement of an arbitrator under this section shall not be
invalid solely because there has been a change in the composition of the arbitral tribunal.”
affect any right of a party to challenge those proceedings on any
ground which had arisen before the arbitrator ceased to hold office “
Section. 29A (8)