Prolonged arbitration proceedings beyond statutory limits render the arbitral award a nullity, thereby allowing for alternative appeal remedies despite initial jurisdictional objections.

JUDGMENT :

B.P. Routray, J.

1. Heard Mr. R. Panigrahy, learned counsel for the petitioners and Mr. P. Tripathy, learned counsel for the opposite party.

2. Present writ petition is directed challenging the arbitral award dated 6^th December 2024 under Annexure-1 passed by the Additional Registrar of Cooperative Societies (Legal and Scheme), Bhubaneswar, in Dispute Case No.172 of 2004.

3. The wife of Petitioner No. 1 initially took a loan amounting Rs.10 lakhs from the Odisha State Cooperative Bank (opposite party) vide loan sanction order dated 29^th April 1999 (Annexure-B). Petitioner No.1 was the guarantor and petitioner No. 2 is the legal representative of the original loanee. Original loanee died subsequently who was the proprietor of M/s. Asian Marketing. After death of the loanee, repayment of loan became due on the part of the petitioners. For default of repayment of loan amount notices were issued to the petitioners and subsequently the matter was referred to the Registrar of Cooperative Societies in terms of the provisions contained in Section 68 of the Odisha Cooperative Societies Act, 1962 (hereinafter referred as „the Act, 1962') raising dispute for arbitration. The Registrar, in exercise of its power in terms of Section 70 of the Act, 1962 appointed the Additional Registrar as the Arbitrator and finally the award is passed on 6^th December, 2024 under Annexure-1 directing the petitioners to repay the loan amount of Rs.11,99,933/- as on 31^st December 2003, along with pendent lite and future interest @ 17.25% per annum as per agreement till full and final realization of the loan amount.

4. Mr. Panigrahi, learned counsel for the petitioners submits that the matter was referred for arbitration in terms of Section 70 of the Act, 1962 on 11^th March 2004 and it was kept pending before the Arbitrator till the date of award, i.e. 6^th December, 2024, which is more than twenty years. It is submitted that in terms of the definition of Arbitration contained in Section 2 (4) of the Arbitration and Conciliation Act, the provisions of said Act is applicable to all such arbitrations in so far as the provisions are not inconsistent with such other enactment. Mr. Panigrahi contends that as per Section 29A of the Arbitration and Conciliation Act, 1996, the time limit for completion of arbitration proceeding cannot continue for more than 18 months at best, and continuation of the arbitration proceeding beyond such period would be a nullity. Therefore, when it is admitted in the present case that the proceeding continued for more than 20 years without any mandate for such extended period, the award of the arbitrator becomes a nullity and in this regard he relies on the decision of Hon'ble Supreme Court in Jharkhand Urja Vikas Nigam Limited v. State of Rajasthan and Others , (2021) 19 SCC 206

5. On the other hand, Mr. Tripathy, learned counsel for the opposite party submits that the statutory provision to appeal against the award has not been availed by the petitioners in terms of Section 109 of the Act, 1962 and thus, the writ petition in the present form is not maintainable. He further submits that the loanee including the petitioners are the deliberate defaulters and therefore, the proceeding initiated against them in terms of Section 68 read with Section 70 of the Act, 1962 resulting grant of the award to such amount as per Annexure-1 cannot be termed as illegal. It is also submitted that the order of sanction contains the terms of the loan including repayment of loan amount with interest @ 17.25%, which has been accepted by the loanee while taking the loan amount.

6. So far as the preliminary objection raised by t