N.B.C.C. LTD. versus J.G. ENGINEERING PVT. LTD.

Citation: [2010] 1 S.C.R. 109 · Decided: 05-01-2010 · Supreme Court of India · Bench: TARUN CHATTERJEE · Disposal: Case Partly allowed

Cited by 2 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

[2010) 1 S.C.R. 109 
N.B.C.C. LTD. 
v. 
J.G. ENGINEERING PVT. LTD. 
Civil App~al No. 8 of 2010 
JANUARY 5, 2010 
[TARUN CHATIERJEE AND AFTAB ALAM, JJ.] 
Arbitration and Conciliation Act, 1996: 
A 
B 
s.14(1) - Termination of mandate of arbitrator- Failure c 
on part of arbitrator to conclude the arbitration proceedings/ 
publish the award within the time limit fixed by parties or such 
extended time as consented by parties - Held: The mandate 
of arbitrator is liable to be terminated - Arbitration -
Efficacious remedy. 
D 
Dispute arose between the parties and matter was 
referred to arbitration. Due to some reasons, arbitration 
proceedings were not concluded. Respondent filed 
application before High Court seeking removal of the 
arbitrator. High Court directed appellant to appoint a new 
E 
arbitrator and further directed the arbitrator so appointed 
to conclude the arbitration proceedings within six 
months. After the expiry of six months, both the parties 
extended the time to conclude arbitration. The arbitrator 
failed to publish the award within the extended time. 
F 
Respondent filed application before High Court for 
a declaration that the mandate of the arbitrator stood 
terminated. High Court by its order dated 23.3.2006. 
terminated the mandate of the arbitrator on the ground 
G 
of delay in making the award. High Court further by order 
dated 21.9.2007 appointed a sole arbitrator to adjudicate 
the disputes between the parties. These appeals were 
filed against orders dated 23.3.2006 and 21.9.2007. 
109 
H 
110 
SUPREME COURT REPORTS 
[2010] 1 S.C.R. 
A 
Partly allowing the appeals and remitting the matter 
to High Court, the Court 
HELD: 1. A perusal of arbitration agreement revealed 
that the arbitrator had power to enlarge the time to make 
8 and publish the award by mutual consent of the parties. 
Therefore, without the consent of both the parties to the 
dispute, arbitrator had no power to further extend the time 
beyond that which is fixed. It is an admitted position that 
the respondent did not give any consent for extension 
C of time. Thus, the arbitrator had no power to further 
enlarge the time to make and publish the award and 
therefore his mandate had automatically terminated after 
the expiry of the time fixed by the parties to conclude the 
proceedings. Arbitration is an efficacious and alternative 
way of dispute resolution between the parties. There is 
D no denying the fact that the method of arbitration has 
evolved over the period of time to help the parties to 
speedily resolve their disputes through this process and 
in fact the Arbitration and Conciliation Act recognizes this 
aspect and has elaborate provisions to cater to the needs 
E of speedy disposal of disputes. The present case 
illustrates that inspite of adopting this efficacious way of 
resolving the disputes between the parties through the 
arbitration process, there was no outcome and the 
arbitration process lingered on for a considerable length 
F of time which defeated ttie notion of the whole process 
of resolving the disputes through arbitration. The 
contention of the appellant therefore cannot be justified 
that since the dispute was highly technical in nature, it 
had to be dealt with elaborately by the arbitrator and that 
G he was justified in being late. High Court correctly fixed 
the time for the arbitration to be concluded within a period 
of six months from the appointment of the fourth 
arbitrator considering the time that was spent for the 
arbitration process prior to his appointment. That apart, 
H even assuming that the arbitration process involved 
N.B,c.c~ LTD. v. J.G. ENGINEERING PVT. LTD. 
111 
highly technical and complex issues, which was time A 
consuming, even then, it was open for the arbitrator or 
for the parties to approach the Court for extension of time 
to conclude the arbitration proceeding which was not 
done either by the arbitrator or by any of the parties. As 
correctly noted by High Court in its impugned judgment, B 
there was no cogent reason for the delay in making and 
publishing the award by the arbitrator. He already had the 
relevant materials at his disposal and could base his 
findings on the observations made by the three arbitrators 
who were appointed prior to him. [Para 5] [118-8-H; 119-
c 
A-DJ 
Jatinder Nath v. Mis Chopra Land Developers Pvt. Ltd. 
& Anr. AIR 2007 SC 1401; General Manager, Department of 
Telecommunications, Thiruvananthapuram v. Jacob Sia 
Kochuva

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