Supreme Court Validates Post-Award Extension of Arbitral Mandate, Court empowers itself to extend arbitrator's mandate even after award issuance, ensuring integrity in arbitration proceedings.
In a landmark judgment delivered on February 3, 2026, the Supreme Court of India, comprising Justices Pamidighantam Sri Narasimha and Atul S. Chandurkar, ruled in favor of extending the mandate of arbitrators even after an award has been rendered post the statutory deadline. The judgment came in the civil appeal case of C. Velusamy v. K. Indhera, where the appellant, C. Velusamy, challenged the High Court's dismissal of an application under Section 29A of the Arbitration and Conciliation Act, 1996.
The case revolved around the power of the court to extend the mandate of an arbitrator under Section 29A(5) of the Arbitration and Conciliation Act, 1996, after the statutory period had lapsed and an award was already issued. The Supreme Court clarified that such an award, rendered after the expiry of the arbitrator's mandate, is unenforceable unless the court decides to extend the mandate. The court emphasized its role in balancing the resolution of disputes through arbitration and maintaining procedural integrity.
Justice Narasimha, writing for the bench, underscored that the statutory provisions do not automatically invalidate the court's power to extend time merely because an award has been pronounced post-deadline. The judgment highlighted the court's discretionary power to impose conditions, reduce arbitrators' fees, substitute arbitrators, and impose costs to ensure timely and disciplined arbitration proceedings.
This ruling sets a significant precedent, providing clarity on the court's jurisdiction in arbitration matters and reinforcing the importance of judicial oversight in ensuring arbitration processes reach a logical and fair conclusion. The decision is expected to have far-reaching implications for arbitration proceedings across India, ensuring that procedural delays do not thwart the dispute resolution mechanism.
Bottom Line:
Court has the power to entertain an application under Section 29A(5) of the Arbitration and Conciliation Act, 1996 to extend the mandate of the arbitrator(s) for making the award even after an award is rendered, though after the expiry of the statutory time limit.
Statutory provision(s): Arbitration and Conciliation Act, 1996 Section 29A(4), 29A(5), 29A(6)
C. Velusamy v. K. Indhera, (SC) : Law Finder Doc id # 2848303
