LexC. VELUSAMY versus K INDHERA
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[2026] 2 S.C.R. 295 : 2026 INSC 112 C. Velusamy v. K Indhera (Civil Appeal No. 696 of 2026) 03 February 2026 [Pamidighantam Sri Narasimha and Atul S. Chandurkar, JJ.] Issue for Consideration Whether a Court can entertain an application u/s.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. Headnotes† Arbitration and Conciliation Act, 1996 – s.29A, 29A(5) – Disputes between the parties, sole arbitrator appointed – Pleadings were completed on 20.08.2022 which was the commencement of the period of twelve months provided u/s.29A(1) for making the Award – Before the conclusion of twelve months, parties filed a joint memo u/s.29A(3) and extended the mandate of the arbitrator by a further period of six months, ending on 20.02.2024 – Matter was reserved for final award on 09.09.2023 – Arbitrator finally passed the award on 11.05.2024 – In the meantime, the mandate of the arbitrator had terminated on 20.02.2024 – Respondent filed application u/s.34 for setting aside the award on the ground that the mandate of the arbitral tribunal expired and arbitral proceedings stood terminated before passing of the award – Appellant filed application u/s.29A seeking extension of the mandate of the tribunal – High Court dismissed the application u/s.29A as not maintainable whereas, s.34 petition filed by the respondent was allowed – Challenge to: Held: Provisions of the Act, particularly s.29A, must not be interpreted to infer a threshold bar for an application u/s.29A(5) for extension of the mandate of the arbitrator even when an award is passed, though after the expiry of the mandate – Court can entertain an application u/s.29A(5) and pass appropriate orders u/s.29A(4) 296 [2026] 2 S.C.R. Supreme Court Reports for extension of the mandate of the arbitrator even after the award is rendered in the meanwhile – Thus, an application u/s.29A(5) for extension of the mandate of the arbitrator is maintainable even after the expiry of the time u/ss.29A(1) and (3) and even after rendering of an award during that time – 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 – While considering the application, the Court will examine if there is sufficient cause for extending the mandate, and in the process, it may impose such terms and conditions as the situation demands – It will also take into account other factors such as reduction of the fee of the arbitrator under proviso to s.29A(4) and also impose costs on parties if the fact situation so demands – Substitution is an option for the Court as the provision itself says, “it shall be open for the Court to substitute”, and it will be exercised carefully – If the mandate is extended, the arbitral tribunal will pick up from where it was left, and seamlessly continue the proceeding from the stage at which the mandate had expired, and conclude within the time granted – Appeal against the judgment in Application No. 5993 of 2024 passed by the High Court is allowed – Application is restored to its original number – High Court will proceed with the said application and dispose it of as per the principles laid down in the present judgment. [Paras 2, 20, 21, 23, 24] Arbitration and Conciliation Act, 1996 – s.29A – Interpretation: Held: Sub-section (1) of s.29A mandates that the award shall be made within 12 months of the completion of pleadings before the Arbitral Tribunal – While sub-section (2) incentivises expeditious making of the Award, proviso to sub-section (4) and sub-section (8) authorises the Court to impose penalty for delay in making the award – Sub-section (3) enables parties, by consent, to extend the period of 12 months for making the award by a further period not exceeding 6 months – If the award is not made within the stipulated period of 12 months or the extended period of 6 months, the mandate of the arbitrator(s) shall terminate – This termination is subject to the power of the Court to extend the period – The ‘Court’ u/s.29A shall be the Civil Court of ordinary original jurisdiction in a district and includes the High Court in exercise of its original civil jurisdiction u/s.2(1)(e), and shall not be the High Court or the Supreme Court u/s.11(6) of th
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