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2025 Supreme(Mad) 4786

IN THE HIGH COURT OF JUDICATURE AT MADRAS
P.B. BALAJI, J.
M/s. S.S. Chauhan and Sons – Appellant
Versus
Union of India, Executive Engineer (II), Trichy - Respondent
A. No. 4258 of 2024
Decided On : 24-01-2025

Advocates Appeared:
For the Appellant : Kunwar Chandresh
For the Respondent: R. Rajesh Vivekananthan

The court has the authority to extend the mandate of the Arbitral Tribunal under statutory provisions, given timely application, regardless of allegations of bias against the arbitrator.

Headnote:(A) Arbitration and Conciliation Act, 1996 - Section 29A(4) and 29A(5) - Extension of time - Application for extending the time period for completion of the arbitration proceedings was filed and opposed on grounds of alleged bias and delay - Court found that the application for extension was timely and that the mandate of the Arbitral Tribunal remained unbroken - Court had the authority to extend the mandate as per statutory provision, resolving that the allegations of partiality did not determine the mandate's status for extension. (Paras 1-15)

(B) Judicial Discretion - Courts retain discretion to extend time limits in arbitration given sufficient cause, as highlighted by reliance on the Supreme Court's decision, underscoring that applications cannot be simply granted without merit. (Para 7)

Facts of the case:
The applicant sought an extension for arbitration proceedings related to a substantial contract with the Union of India, where an interim award had been partially granted while the final award was pending completion due to allegations against the arbitrator's conduct.

Findings of Court:
The application for extension was allowed for 15 days enabling the arbitrator to publish the award after upholding the timely submission of the extension application and dismissing the claims of partiality.

Issues: The core issues involved whether the extension application was timely filed and the implications of alleged bias concerning the arbitrator's conduct.

Ratio Decidendi: The court determined that the statutory provisions permit the extension of the arbitrator's mandate when an application is submitted before the expiration period, notwithstanding the allegations regarding the arbitrator's impartiality.

Result: Application allowed.

Table of Content
1. request for extension of arbitral proceedings. (Para 1 , 3)
2. arguments on the conduct of the arbitrator and counterclaims. (Para 4 , 5 , 6 , 7 , 8)
3. court's analysis of arbitration process and statutory provisions. (Para 9 , 10 , 11 , 12 , 13)
4. final order extending the mandate of the arbitrator. (Para 14 , 15)

ORDER :

1. This is an application seeking to extend the time period for completion of the Arbitration Proceedings by six months.

2. I have heard Mr.Kunwar Chandresh, learned Counsel for the applicant and Mr.R.Rajesh Vivekananthan, learned Deputy Solicitor General of India for the respondents. I have also gone through the pleadings as well as the documents filed by way of typed of papers, including the decision of the Hon'ble Supreme Court, on which reliance is placed on by the learned Counsel for the respondent.

3. The case of the petitioner is that the sole arbitrator was appointed to adjudicate the disputes between the parties arising under Contract No. 02/ADG/EE(Trichy)-II/21-22 in respect of the tender contract for Rs.41,32,54,950/-. The applicant before this Court is the claimant before the Arbitral Tribunal. The respondent is the Union of India, Government Department, (CPWD).

4. The learned counsel for the Applicant would state that after trial, before the Arbitral Tribunal, the claimant and the respondent advanced final arguments and the same was concluded on 28.10.2023. Both parties sought for time to file written synopsis. Thereafter, the claimant has filed its written synopsis on 16.11.2023 and the respondent has filed its written synopsis on 18.11.2023. It is seen that subsequently, the claimant has moved an Application before the learned Arbitrator to pass an interim award in respect of part of Claim No.1, considering the nature of claim and heavy losses suffered by the claimant. Accepting the said request, the sole Arbitrator has also passed an interim award, partially allowing Claim No.1. In respect of the other Claims, the Arbitrator has not been able to pass a final award and hence, the Application has been filed seeking extension of the mandate of the Arbitrator.

5. This Application is vehemently opposed by the respondent. The learned Deputy Solicitor General of India appearing for the respondent would submit that subsequent to the Claim being filed, the respondent filed a statement of defense along with a counterclaim on 21.07.2023. A reply to the said rejoinder was filed by the claimant on 29.08.2023 and therefore, pleadings stood completed on 29.08.2023. According to the learned counsel for the respondent, at the request of the claimant, within one week from the date of request made by the claimant, on 21.11.2023, the learned Arbitrator has passed an interim award, within 7 days i.e., on 27.11.2023 without passing a final award, despite the matter being reserved only for passing of the final award.

6. The learned counsel for the respondent states that the very fact that such a hasty interim award has been passed, clearly exposes the bias in the conduct of the learned Arbitrator and the respondent has lost confidence in the sole Arbitrator and apprehends that the final award would not be impartial or independent. The learned counsel would also invite my attention to the objection dated 02.08.2024, in and whereby, the respondent has raised serious objections which have not been replied to by the learned Arbitrator till date. The learned counsel would also bring to my attention that the said Arbitrator has been removed from the list of CPWD impaneled Arbitrators by official memorandum of CPWD dated 23.07.2024. The learned counsel would therefore submit that the delay being solely attributable to the Arbitral Tribunal and not to either of the parties to the proceedings, the extension sought for cannot be granted.

7. The learned counsel would also place reliance on the decision of the Hon'ble Supreme Court in Rohan Builders (India) Pvt. Ltd. v. Berger Paints India Ltd. where the Hon'ble Supr

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