The court ruled that stale arbitration proceedings should not be extended, as the parties demonstrated a lack of interest and sufficient cause for delay, leading to dismissal of the petitions.

JUDGMENT :

Context and Background :

1. This is a bunch of Petitions filed and pending under Section 29-A of the Arbitration and Conciliation Act, 1996 (“the Act”) in connection with arbitration proceedings between multiple Petitioners (“Petitioners”) and the common Respondent, Arrow Engineering Ltd. (“Arrow”). These matters have been pending on the docket of this Court for a long time (since 2020), with neither party seriously pursuing the matter.

2. As it transpires, there have been a total of 22 Petitions, of which four came to be withdrawn. Of the 18 remaining Petitions, three Petitions (Arbitration Petition (L) Nos. 4321, 4322 and 4323 of 2020) were heard and disposed of by a Learned Single Judge of this Court by an order dated October 12, 2020 (“October 2020 Order”) extending the mandate of the Learned Arbitral Tribunal until November 1, 2021. Review Petitions were filed by Arrow in each of the Petitions that were disposed of, and the Learned Single Judge tagged the three Review Petitions with these Petitions by an order dated December 8, 2020.

3. Thereafter, nothing concrete has moved in the matter. Even the extended mandate expired. No fresh petitions under Section 29-A of the Act were filed by the three parties involved.

4. These matters were listed by the Court on its own motion, when it was found that these Petitions have been pending for over five years. The proceedings got underway after a few rounds of jostling among the parties about the appropriate manner to proceed further.

Arbitration Proceedings:

5. The underlying arbitration proceedings relate to contracts by which, Arrow was to construct bungalows in the Navi Mumbai International Airport Influence Notified Area (“NAINA”) that was being planned by the City and Industrial Development Corporation of Maharashtra Ltd. (“CIDCO”). The claims from the Petitioners were for Arrow to be directed to specifically perform the contracts to construct the Petitioners’ bungalows.

6. Indeed, it was that the Petitioners that had initiated arbitration and secured orders under Section 11 of the Act from this Court to get the arbitration proceedings underway. A Learned Senior Counsel of this Court was appointed as an arbitrator on June 30, 2016. Pleadings in the arbitration were completed by April 26, 2017. On June 19, 2017, an application was made by the Petitioners before the Learned Arbitral Tribunal asking for leave to approach this Court for issuance of witness summons under Section 27 of the Act to a planning official of CIDCO (NAINA), since bringing a government servant as a witness into a private arbitration was not within the powers of the Petitioners. The application was allowed by the Learned Arbitral Tribunal.

7. No Petition under Section 27 was filed in Court. On October 29, 2017, an application was moved before the Learned Arbitral Tribunal requesting that the mandate of the Learned Arbitral Tribunal be terminated on the premise that the Petitioners realised that they would be unable to afford the fees of the Learned Arbitral Tribunal. It was also pointed out that in another parallel arbitration proceedings being conducted before another arbitral tribunal, Arrow had been unable to pay arbitrator fees, on the premise that its accounts had been frozen. Therefore, the Petitioners submitted, they would be burdened even more by having to pay Arrow’s fees as well to the Learned Arbitral Tribunal. Arrow filed a reply stating that there was no scope for termination of arbitration proceedings on the premise that payment of costs was unaffordable. However, Arrow submitted that a simple termination of arbitration as envisaged in the Act would be acceptable. A rejoinder was filed by the Petitioners contending that Arrow indeed had initially consented to terminate the arbitral proceedings due to the fees being unaffordable and even had traded drafts of a joint application for termination. However, it was submitted, after one Mr. Vineet Malhotra (the promoter of Arrow) was arrested, Arrow