Sanchayita Lahkar

The High Court of Calcutta Commercial Division Single Bench of Justice Shampa Sarkar held that the mandate of the learned arbitrator would not lapse merely on account of the expiry of statutory timelines and has been extended by a further period of one year. The Court directed that the arbitral proceedings, which had continued beyond the expiry of the original mandate, stand validated upon such extension. The petition was accordingly disposed of with a formal order extending the arbitrator’s mandate.

The proceedings arose from an application filed seeking extension of the mandate of the learned arbitrator appointed in a commercial dispute between the parties. The petitioner submitted that although the statutory mandate under the Arbitration and Conciliation Act, 1996 had expired, the proceedings had continued with the participation of both sides, including production of witnesses and evidence. The petitioner prayed for judicial extension of the mandate so that the proceedings already undertaken would not be rendered futile.

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On the previous occasion, the respondent had objected to such prayer on the ground that the arbitrator had continued the proceedings even after the expiry of the mandate, thereby rendering the subsequent proceedings a nullity. It was argued that once the statutory period had lapsed, the arbitrator became functus officio and could not proceed further without a fresh order of the Court.

The Court had earlier held that the conduct of the parties, particularly their participation in the proceedings after the initial statutory period, amounted to consensual extension by a further six months under Section 29A(3) of the Arbitration and Conciliation Act, 1996. The statutory framework permits such consensual extension, and by applying Section 4 of the said Act, the Court concluded that the respondent had waived its right to object by participating in the proceedings without protest.

Section 4 provides that a party who, being aware of non-compliance with any provision of the arbitration agreement or the Act, nonetheless proceeds with the arbitration without timely objection, is deemed to have waived its right to so object.

Despite this, the respondent insisted that unless the Court determined the validity of the proceedings conducted after 18 months had expired, the mandate should not be extended. According to the respondent, any such extension would validate proceedings that were otherwise a nullity. The respondent also submitted that no sufficient cause had been shown by the petitioner for the delay in filing the present application.

The records revealed that the pleadings had been completed, and the initial period of one year expired on March 12, 2024. By conduct of parties, a further six months was impliedly agreed upon, thereby extending the mandate up to March 12, 2025. The application for extension was filed on July 2, 2025, after expiry of the 18-month period. During the intervening time, approximately three sittings had been conducted by the arbitrator, in which both parties had participated.

The respondent objected that these sittings vitiated the entire arbitral proceedings. However, the petitioner maintained that under Section 29A(4), the Court possesses power to extend the mandate both before and after the expiry of the statutory period. It was contended that once such extension is granted, the proceedings would stand validated retrospectively, thereby avoiding a legal vacuum in arbitral jurisdiction.

Justice Shampa Sarkar recorded that Section 29A(4) of the Arbitration and Conciliation Act, 1996 provides: “If the award is not made within the period specified in sub-section (1) or the extended period specified under sub-section (3), the mandate of the arbitrator(s) shall terminate unless the court has, either prior to or after the expiry of the period so specified, extended the period.”

The Court observed that the phrase “either prior to or after” makes it clear that the Court can revive the arbitrator’s mandate even if it has expired. The judicial order of extension “in effect, validates the proceeding.”

The judgment further stated: “The provision ensures that there is no legal vacuum or break in the arbitrator’s jurisdiction between expiry and extension. Thus, in my view the arbitral proceedings between the date of termination and the order of Court are not void.”

Referring to the second proviso to Section 29A(4), the Court observed: “The legislative intent was that an arbitral proceeding should continue even if the mandate terminates and an application for extension is pending before a Court. This is in consonance with the object behind the said Act, i.e., to ensure speedy disposal of disputes.”

The Court stated that the statute consciously did not mandate that extension applications must be filed before expiry. Instead, flexibility was provided so that “legitimate delays do not frustrate arbitration.” However, it was clarified that until the Court passes an extension order, any proceedings after expiry would be without jurisdiction, though they become validated retrospectively once extension is ordered.

The Court recorded: “An order of extension of the mandate by Court grants retrospective continuity to the mandate of the arbitrator.”

The respondent’s contention that extension would amount to validating an abandoned proceeding was expressly rejected. The Court found that both parties had adduced evidence and produced their witnesses, and that no intentional delay was attributable to either the petitioner or the arbitrator.

“Under such circumstances, when substantial progress has been made in the proceedings, this Court does not find that there is any reason not to extend the mandate. The extension will enure to the benefit of the parties who have invested sufficient time and resources in the arbitral proceeding.”

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The High Court directed that the mandate of the learned arbitrator be extended by a further period of one year from the date of the order. The Court held that the arbitral proceedings which took place between the expiry of the earlier mandate and the passing of this order are not void, as the extension order retrospectively validated them.

Justice Shampa Sarkar recorded:“The mandate of the learned arbitrator is extended by a further period of one year. This order is restricted to the disposal of this application.”

The Court further directed that the contention of the respondent, that the sittings conducted after expiry should be expunged from the records, would not be deliberated upon in this application and was left open to be agitated at the appropriate stage.

Accordingly, the application AP-COM/540/2025 was disposed of.

Advocates Representing the Parties

For the Petitioners: Mr. Subhasish Sengupta, Adv.; Mr. Biswajib Ghosh, Adv.; Mr. Sayak Mitra, Adv.; Mr. Avirup Chatterjee, Adv.; Mr. Rishov Das, Adv.

For the Respondents: Mr. Sanjay Paul, Adv.

Case Title: Glen Industries Private Limited vs Oriental Insurance Company Limited

Case Number: AP-COM/540/2025

Bench: Justice Shampa Sarkar