Court cites administrative delays and COVID-19 impact as grounds for extending the arbitration timeline in the case involving NHAI and Sandesh Kumar's legal heirs.
In a significant judgment dated November 26, 2025, the Himachal Pradesh High Court has granted an extension for the mandate of the arbitrator in the arbitration proceedings involving the late Sandesh Kumar's legal representatives and the National Highway Authority of India (NHAI). The court found "sufficient cause" for the delay in proceedings due to administrative errors and the impact of the COVID-19 pandemic, directing the arbitrator to conclude the case within six months.
The case originated from a land acquisition notification under the National Highways Act, 1956, for a highway expansion project between Solan and Shimla. Sandesh Kumar, whose land was acquired, had initially contested the compensation awarded by the Competent Authority/Land Acquisition. Following his demise, his legal heirs continued the arbitration proceedings.
The court noted procedural delays, including incorrect naming of Sandesh Kumar in official documents as Sandeep Kumar, and misplaced extension orders, as contributing factors to the delay. Despite these setbacks, the court underscored that the arbitration process must move forward efficiently and pragmatically to resolve the dispute.
Justice Ranjan Sharma, presiding over the case, dismissed the opposition from NHAI, which argued against the extension citing potential financial losses. The court emphasized that the delays were not solely attributable to the petitioners and highlighted the importance of concluding arbitration effectively to uphold the statute's intent.
The court's decision aligns with precedents set by the Supreme Court, which allows for extensions under Section 29A of the Arbitration and Conciliation Act, 1996, when justified by "sufficient cause." This ruling ensures that the arbitration process remains a viable alternative dispute resolution mechanism, even in the face of unforeseen administrative and procedural hurdles.
The High Court's directive mandates the arbitrator-cum-Divisional Commissioner, Shimla, to conclude the proceedings expeditiously and deliver an award within six months, thereby facilitating a resolution to the long-standing dispute.
Bottom Line:
Arbitration proceedings delayed due to administrative and procedural issues, including incorrect description of the predecessor's name and misplaced extension orders, are entitled to an extension of mandate for effective and logical conclusion of arbitral proceedings.
Statutory provision(s): Arbitration and Conciliation Act, 1996 Section 29A
