Facts: Disputes arose between C. Velusamy (Appellant) and K. Indhera (Respondent) governed by three agreements to sell. The Appellant initiated arbitration proceedings, and a sole arbitrator was appointed by the High Court. The parties initially extended the arbitrator's mandate by mutual consent. However, settlement discussions delayed the final award, which was eventually passed after the arbitrator's mandate had expired. The Respondent challenged the award under Section 34 of the Arbitration and Conciliation Act, 1996, arguing the mandate had expired. The Appellant then filed an application under Section 29A seeking an extension of the mandate.
Procedural Posture: The High Court dismissed the Appellant's application under Section 29A, deeming it not maintainable, and allowed the Respondent's Section 34 petition, setting aside the award. This led to the present Civil Appeal before the Supreme Court, challenging the High Court's order.
Issue: 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?
Holding: Yes, the Supreme Court held that a court can entertain an application under Section 29A(5) for extension of the arbitrator's mandate even after the expiry of the prescribed time and even after the rendering of an award.
Reasoning: The Court reasoned that Section 29A does not explicitly bar such an application. The power vested in the Court under Section 29A to extend the mandate is independent of the arbitrator's actions. The phrase "if an award is not made" in Section 29A(4) is interpreted in the context of enabling the court to extend the mandate, not to restrict its power when an award is already made. The Court emphasized the intention of Parliament to secure arbitral proceedings and ensure their logical conclusion. The Court also highlighted that an award made after the expiry of the mandate is "non est" (unenforceable), but this does not denude the court's power to extend the mandate retrospectively. The Court also observed that Section 29A provides sufficient tools to ensure the integrity and efficiency of the arbitral process, including the power to substitute arbitrators and impose costs. The Court emphasized that while exercising this power, it would act with circumspection, balancing the remedy with the rights of other stakeholders.