Bombay High Court Rejects Konkan Railway’s Plea to Scrap Arbitration Panel in Chenab Bridge Dispute | No Case Made Under Section 29-A as SAT’s Delay Not Undue, Nor Are Arbitrators Biased
Isabella Mariam
The High Court of Bombay Single Bench of Justice Somasekhar Sundaresan has extended the mandate of the Standing Arbitral Tribunal (SAT) adjudicating disputes under a commercial contract for the construction of the Chenab Rail Bridge. The extension has been granted until June 30, 2026, following the rejection of objections raised by one of the parties opposing the continuation of the tribunal. The court found no cause to terminate or substitute the current composition of the tribunal.
The judicial directive followed multiple petitions under Section 29-A of the Arbitration and Conciliation Act, 1996, seeking an extension of the tribunal's mandate. The petitioners and respondents had entered into an arbitration agreement providing for adjudication of multiple half-yearly claims by a standing tribunal. The court observed that the tribunal had actively engaged with the matter, and allegations of delay and procedural irregularities did not warrant judicial interference. It was held that procedural decisions of the tribunal cannot be a basis for refusal to extend the mandate, especially when claims are ongoing and substantial adjudicatory effort has already been undertaken.
The court accordingly allowed the petitions, declined substitution of arbitrators, and directed both parties to comply with tribunal schedules and logistical requirements.
The dispute arises out of a commercial contract dated November 24, 2004, for the design and construction of a special rail bridge across the Chenab River in the Katra-Laole section of the Udhampur-Srinagar-Baramulla Rail Link Project. The contract, governed by the Northern Railways’ standard terms, led to the execution of a separate arbitration agreement dated February 28, 2012. This agreement established a three-member Standing Arbitral Tribunal (SAT) for adjudicating disputes under the contract.
The agreement provided that claims would be submitted on a half-yearly basis, and the SAT would have continued jurisdiction over all claims. Initially, the composition of the SAT was influenced by the respondent, Konkan Railway Corporation Limited, which presented a panel of former railway officials. The petitioner, Chenab Bridge Project Undertaking (a joint venture), would select two names, from which one would be finalized by Konkan Railway as the petitioner’s nominee. The respondent’s Managing Director would also appoint the other two arbitrators, including the presiding arbitrator.
The first SAT formed failed to proceed due to the Presiding Arbitrator’s inability to continue. On an application under Section 11 of the Act, the High Court appointed a new Presiding Arbitrator, but this was challenged. Eventually, by consent, the Supreme Court appointed Justice (Retd.) R.V. Raveendran as Presiding Arbitrator in 2013, creating the Raveendran SAT to decide initial claims. Meanwhile, Konkan Railway unilaterally constituted another SAT under the agreement, headed by Mr. Anirudh Jain (the Jain SAT). The Supreme Court later clarified that the Raveendran SAT would decide half-yearly claims no. 1 to 3, and the Jain SAT would address the remainder.
The Jain SAT was to address claims no. 4 to 9 initially, with subsequent filings including up to claim no. 24. The arrangement, although intended to ensure a stable dispute resolution mechanism, lacked institutional support. The SAT functioned as an ad hoc tribunal, requiring coordination between arbitrators. In January 2020, Chenab sought termination of the Jain SAT due to delays, asserting that it was refusing to proceed. Both parties eventually agreed to a new SAT chaired by Mr. Aditya Kumar Mittal in January 2021 (the Mittal SAT).
By February 2025, oral arguments for claims no. 10 to 19 had concluded, and written submissions were filed in April 2025. These claims involved 105 sub-claims. Konkan Railway objected to extending the SAT’s mandate, citing procedural violations, delays, and potential amendments that could prolong proceedings. Chenab countered by submitting a timeline of tribunal activities and sought extension.
Justice Sundaresan stated, "The arbitral tribunal is the master of proceedings and has full freedom on how to conduct the proceedings and sequence the actions necessary for appropriate adjudication." He noted that under Section 29-A, the court's role is limited to considering whether there is a cause to extend the mandate, not to examine procedural decisions.
On the constitution of the SAT, the court recorded that, "The very conceptualisation of the SAT was to have one set of minds being consistently applied to all the issues involved in disputes and differences relating to the Contract." It was observed that judicial review was not warranted simply because a party disagreed with the tribunal’s procedures.
The court recorded that the SAT operated through the COVID-19 pandemic and handled voluminous material across numerous hearings. "There is no cause for this Court to make an intervention in relation to half-yearly claims no. 20 to 24 filed before the SAT," the judgment recorded.
The petitioner and respondent had filed multiple applications regarding the claims. On this, the court observed, "The parties have also thrown the kitchen sink at the proceedings and loaded the SAT with their applications and submissions. It is not in dispute that material to be sifted through runs into lakhs of pages."
Addressing Konkan Railway’s contention about potential procedural flaws, the court stated, "Even if Konkan Railway is right about the procedural decisions of the SAT being in conflict with the Arbitration Agreement, that would give Konkan Railway a ground for challenging the arbitral award under Section 34 of the Act."
The court also dismissed the apprehension that the SAT might permit amendments to pleadings in future. It stated, "An apprehension that something that was not interfered with may be repeated in future, is no basis to replace the SAT."
The judgment noted that the SAT’s composition was not challenged for partiality or bias. Instead, objections stemmed from disagreement with procedural management. "What is apparent is that Konkan Railway is unhappy with the SAT constituted by it from among railway officials, only because it disagrees with the appropriateness and wisdom of its decisions."
The court passed several specific directions. It held, "Konkan Railway has not made out a case to demonstrate that the Mittal SAT is proceeding with undue delay." It further stated that "Whether to permit amendments is a matter for consideration by the SAT" and added that such permissions previously granted had already been unsuccessfully challenged.
The court stated that "Should any step taken by the SAT be in conflict with the fundamental law and policy of India, that would be a ground to challenge under Section 34 of the Act, and not a ground for seeking replacement of the SAT under Section 29-A of the Act."
Regarding Konkan Railway's suggestion of replacing arbitrators with retired judges, the court held, "Since no case for substitution of the arbitrators is made out, it is unnecessary to examine the request for introducing retired judges of a High Court or the Supreme Court into the SAT."
It concluded, "The mandate of the SAT in respect of the references covered by the captioned Petitions is hereby extended to June 30, 2026." The court declined to extend the mandate until December 2026 as requested and cautioned both parties to avoid unnecessary adjournments.
The court added, "The SAT is requested to indicate to the parties any shortcomings and constraints in logistics that have been faced so far." It further directed the parties to ensure adequate logistical support to facilitate the tribunal’s functioning.
In conclusion, the court stated that if any party seeks unnecessary adjournments or makes frivolous applications, "the SAT is requested to fix dates as close as possible and not refrain from considering imposition of costs."
Advocates Representing the Parties:
For the Petitioner: Mr. Zal Andhyarujina, Senior Advocate a/w Mr. Karl Tamboly, Mr. Punit Damodar, Ms. Raveena Kinkhabwala, Mr. Hitesh Singhvi, Mr. Akshay Dhayalkar
For the Respondents: Mr. Ashish Kamat, Senior Advocate a/w Mr. Sarosh Bharucha, Mr. D.J. Kakalia, Ms Bhavna Jaipuria, Mr Paresh Patkar & Kartik Hede
Case Title: Chenab Bridge Project Undertaking v. Konkan Railway Corporation Limited
Neutral Citation: 2025: BHC-OS:8422
Case Number: COMMERCIAL ARBITRATION PETITION (L) NO. 12314 OF 2025 & connected matters
Bench: Justice Somasekhar Sundaresan
[Read/Download order]
