Kiran Raj

The Supreme Court Division Bench of Justice P.S. Narasimha and Justice Atul S. Chandurkar, in an order dated Tuesday (February 3), held that an arbitral award delivered after the statutory timeline can still be acted upon if a party moves the competent court under Section 29A seeking extension of the tribunal’s mandate, and that such an extension plea is maintainable even after the award is made. The dispute arose from sale agreements between the parties, which went to arbitration; the award was issued after the mandate had lapsed, prompting one side to seek its setting aside while the other sought extension. Allowing the appeal, the Court restored the extension application for fresh consideration by the competent High Court.

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The dispute between the parties arose out of three agreements to sell, following which one side moved the High Court under Section 11 of the Arbitration and Conciliation Act, 1996, leading to appointment of a sole arbitrator. The arbitrator issued notice on May 4, 2022, held the first meeting on May 28, 2022, and pleadings were completed on August 20, 2022, marking the commencement of the twelve-month period under Section 29A(1).

Before the initial twelve months ended, both sides filed a joint memo under Section 29A(3) extending the mandate by six months up to February 20, 2024. Arguments concluded and the matter was reserved for award on September 9, 2023.

Thereafter, the proceedings were reopened on the parties’ representations. The record refers to emails from the respondent indicating ongoing settlement discussions, adjournments in that context, and a further reservation for award on January 30, 2024. It also records that discussions continued until March 2024 when a tripartite agreement was entered into with a third party, but it was not placed before the arbitrator.

The arbitrator passed the award on May 11, 2024, later stamped and issued on June 25, 2024, after the mandate had terminated on February 20, 2024. The respondent then filed a Section 34 application to set aside the award on the ground that the mandate had expired before the award was made, while the appellant filed an application on November 12, 2024 under Section 29A seeking extension of the tribunal’s mandate.

The Court recorded the central question for consideration as: “Whether a Court can entertain an application under Section 29A(5) of the Arbitration and Conciliation Act, 1996 to extend the mandate of the arbitrator(s) for making the award even after an ‘award’ is rendered, though after the expiry of the statutory limit of eighteen-month period?”

At the outset, the Court stated: “We have considered the text as well as the context in which Parliament introduced Section 29A to the Act, empowering the Court to extend the mandate of the arbitrator.” It added: “The power and the jurisdiction of the Court are not impaired by the indiscretion of the arbitrator in rendering an ‘award’ without a mandate, particularly when such an award does not partake the character of a decree and is unenforceable under Section 36.”

On maintainability of an extension plea even after an award is rendered beyond time, the Court observed: “In view of the above analysis, we are of the opinion that provisions of the Act, particularly Section 29A, must not be interpreted to infer a threshold bar for an application under Section 29A(5) for extension of the mandate of the arbitrator even when an award is passed, though after the expiry of the mandate.” It further stated: “Section 29A of the Act does not, in terms, bar an application for extension of the mandate of an arbitrator in the event of the delivery of an award. There is no such prescription anywhere in the section.”

Addressing the effect of an award delivered after expiry of mandate, the Court recorded: “if an award is made after expiry of the mandate, then there is no doubt about the fact that such an award is non est. A better expression would be to hold that such an award would be unenforceable under Section 36. Such an award need not be challenged under Section 34.” The Court then stated: “a unilateral act or the indiscretion of the arbitrator in making such an award will have no bearing on the power and jurisdiction vested in the Court under Section 29A.”

Referring to the statutory phrasing, the Court noted that sub-section (4) reflects that the mandate terminates unless the Court has “either prior to or after the expiry of the period so specified, extended the period”. It also recorded that, as held in Rohan Builders (India) Pvt. Ltd. v. Berger Paints India Ltd., “the Court can extend the period before or after the expiry of the mandate.” On the character of “termination” under Section 29A(4), the Court reproduced the Rohan Builders explanation: “the termination of the arbitral mandate is conditional upon the non-filing of an extension application and cannot be treated as termination stricto sensu.” It further recorded: “The word "terminate" in the contextual form does not reflect termination as if the proceedings have come to a legal and final end, and cannot continue even on filing of an application for extension of time.” The Court also quoted Rohan Builders to state: “termination under Section 29A(4) is not set in stone or absolutistic in character.”

The Court also referred to the following observation from Rohan Builders (India) Pvt. Ltd. v. Berger Paints India Ltd. (2024).on the court’s duty where an award is pronounced during pendency of an extension application: “the court must still decide the application under sub-section (5), and may even, where an award has been pronounced, invoke, when required and justified, sub-sections (6) to (8), or the first and third proviso to Section 29A(4) of the A & C Act.”

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The Court directed that “an application under Section 29A (5) for extension of the mandate of the arbitrator is maintainable even after expiry of the time under Sections 29A (1) and (3) and even after rendering of an award. Such an award is ineffective and unenforceable, but the power of the Court to consider extension is not impaired by such an indiscretion of the arbitrator.”

“The appeal against the judgment and order dated 24.01.2025 passed by the High Court of Judicature at Madras is allowed. Application No. 5993 of 2024 shall stand restored to its original number and be disposed of in accordance with the principles laid down in this judgment.”

Advocates Representing the Parties

For the Appellant: Mrs. V Mohana, Sr. Adv.(arguing counsel) Mr. B Ragunath, Adv. Mr. Pranav V Shankar, Adv. Mrs. N C Kavitha, Adv. Mrs. Nimisha Thomas, Adv. Mr. Vijay Kumar, AOR Ms. Runjhun Garg, Adv.

For the Respondent: Mr. M. Vijayan, Adv.(arguing counsel) Mr. M. Harish Kumar, Adv. Mr. P. S. Sudheer, AOR Mr. Rishi Maheshwari, Adv. Ms. Anne Mathew, Adv. Mr. Bharat Sood, Adv. Mr. Jai Govind M J, Adv. Mr. Jashan Vir Singh, Adv.

Case Title: C. Velusamy v. K. Indhera                                                                                

Neutral Citation: 2026 INSC 112

Case Number: Civil Appeal arising out of SLP (C) No. 6551 of 2025

Bench: Justice P.S. Narasimha, Justice Atul S. Chandurkar