Timely completion of arbitration proceedings is mandatory under the Arbitration and Conciliation Act, and failure to adhere to statutory timelines may result in termination of the arbitrator's mandate.

JUDGMENT :

Bipin Chander Negi, J.

1. The arbitral dispute arises out of the land acquisition in District Shimla, H.P. for the purpose of building (widening/four laning etc.) maintenance, management and operation of National Highway-05. The land has been acquired under the provisions of National Highways Act, 1956.

2. Arbitration case No. 572 of 2024 pertains to Award No. 10 dated 01.06.2015 with respect to which the petitioner had preferred Reference Petition No. 145 of 2016. In the aforesaid reference, the Arbitrator had issued notices for 17.01.2017. Reply was filed in March, 2017. Vide order dated 13.03.2023, it was observed that the mandate of the Arbitrator had expired. Hence, the aforesaid arbitral proceedings were kept in abeyance, till the time period for completing the arbitral proceedings, was extended under Section 29-A.

3. From a perusal of the aforesaid, it is evident that the Reference Petition against the award had been filed by the land owners about 8 years back.

4. The relevant extract of the provisions involved in the present lis, as amended by the Act No. 33 of 2019 w.e.f 31.08.2019, are being reproduced here-in-below for a ready reference:-

“29-A. Time limit for arbitral award:

(1) The award in matters other than international commercial arbitration be made by the arbitral tribunal within a period of twelve months from the date of completion of pleadings under sub-section (4) of Section 23:

(2)…………..

(3) The parties may, by consent, extend the period specified in sub-section (1) for making award for a further period not exceeding six months.

(4) If the award is not made within the period specified in sub-section (1) or the extended period specified under sub- section (3), the mandate of the arbitrator(s) shall terminate unless the court has, either prior to or after the expiry of the period so specified, extended the period: Provided that while extending the period under this sub- section, if the court finds that the proceedings have been delayed for the reasons attributable to the arbitral tribunal, then, it may order reduction of fees of arbitrator(s) by not exceeding five per cent for each month of such delay: 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.

(5) The extension of period referred to in sub-section (4) may be on the application of any of the parties and may be granted only for sufficient cause and on such terms and conditions as may be imposed by the court.

Section 23. Statements of claim and defence (4) The statement of claim and defence under this section shall be completed within a period of six months from the date the arbitrator or all the arbitrators, as the case may be, received notice, in writing, of their appointment.”

The sum and substance of the aforesaid provisions is that from the date the arbitrator receives notice the statement of claim and defence (pleadings) shall be completed within a period of six months there from. Further the award shall be made by the arbitral tribunal within a period of twelve months from the date of completion of pleadings. However, the parties may, by consent, extend the period specified for making award for a further period not exceeding six months. If the award is not made within the period specified or the extended period specified the mandate of the arbitrator shall terminate unless the court has, either prior to or after the expiry of the period so specified, extended the period. The extension may be on the application of any of the parties .The same may be granted only for sufficient cause and on such terms and conditions as may be imposed by the court.

5. Having gone through the order sheets appended with the petitions carefully, this Court is pained to observe that the proceedings have been conducted by learned Arbitrator by observing