Extension of time by ‘consent’ of parties
The provision of extending the mandate by way of mutual consent is constrained to sub-section (3) and for a maximum period of six months. Any petition under sub-section (4) for seeking extension of time must be tested independently on the anvil of “sufficient cause” and extension must be “on such terms and conditions as may be imposed by the Court.”
The test of sufficient cause must align with the object of Section 29-A of the Act. So far, the courts have considered voluminous pleadings, advanced stage of arguments, ongoing evidence/cross-examination, impending pronouncement of award as sufficient causes to allow extensions.
Generally, the courts have refrained from reprimanding parties or arbitrators for causing the delay. However, the Delhi High Court in Wadia Techno–Engineering Services Limited. v. Director General of Married Accommodation Project, while extending the mandate of the arbitral tribunal, imposed costs of ₹30,000 on the respondents for their egregious conduct during the arbitral proceedings.
The Delhi High Court in Barasat Krishnagar Expressways Limited vs National Highways Authority of India also substituted the presiding arbitrator on the basis that the arbitration proceedings have not made much progress despite the fact that almost eighteen months had passed.
The period of eighteen months ought to be generally considered as the outer limit for passing of award, unless some compelling circumstances warrant extension of time. In other words, the benefit of extension of time under Section 29-A of the Act ought not to be granted as a matter of course, and the responsibility of the party or parties or the arbitrator/s responsible for delaying the arbitration proceedings must be necessarily examined. Moreover, consequences under Section 29-A (4), (6) and/or (8) of the Act must follow if the requisite deadline of eighteen months is not adhered to. This will go a long way in reducing the time consumed in passing of arbitral awards.
Source: Barandbench
