In hearing the dispute between the parties with respect to three agreements to sell, which lead to the appointment of a sole arbitrator by the High Court in April 2022, which questions the maintainability of Section 29A after rendering the Arbitral Award the Supreme Court of India Rules in affermative.

Background: The High Court appointment of a sole arbitrator in April 2022, followed by the completion of pleadings in August 20, 2022, the statutory 12-month period for making the award commenced. The parties later extended this mandate by mutual consent for an additional six months, which ended on February 20, 2024.

Although the matter was reserved for an award, settlement discussions caused delays, and the arbitrator ultimately passed the award on May 11, 2024 —nearly three months after the mandate had legally terminated. The respondent challenged the award under Section 34, arguing it was a nullity due to the expired mandate.

Subsequently, the appellant filed an application under Section 29A(5) seeking a retrospective extension of time. The High Court dismissed the extension application as non-maintainable, reasoning that Section 29A does not permit an extension once an award has already been delivered.

While setting aside the High Court’s decision, the Supreme Court held that Section 29A does not impose a threshold bar against extension applications following the delivery of a late award, and that Courts can entertain a Section 29A(5) application to extend the mandate even after an "award" is rendered post-expiry.

The Apex Court emphasized that the effectiveness of judicial remedies is a constitutional mission, and alternative dispute resolution mechanisms must be protected from technical failures.

The Apex Court further held that while an award made after the mandate has expired is considered non est or unenforceable under Section 36, this unilateral "indiscretion" by an arbitrator does not divest the Court of its statutory power and jurisdiction.

Supreme Court also highlighted thet the legislative intent behind Section 29A was to curb delays through a facilitative and corrective mechanism rather than to abort the arbitral process entirely.

Describing the Section 29A of the Act as a "toolkit" that allows judges to balance the integrity of the process with the need for a final resolution, the Apex Court held that this toolkit includes the power to extend time retroactively, reduce arbitrator fees for delays, or substitute arbitrators if the circumstances warrant such action.

**Additionally, the Apex Court observed that if the mandate is extended, the tribunal "picks up the thread" from where it left off to conclude the proceedings legally.

In conclusion, the Supreme Court held that the term "terminate" in Section 29A(4) is not absolute or "set in stone"; rather, it is transitory and subject to the Court’s power to facilitate the conclusion of proceedings and that it does not denude the Court’s power to retroactively extend time to preserve the arbitral process. However, the Apex Court held that though the provision itself says, “it shall be open for the Court to substitute”; it shall be exercised carefully.

CORAM: PAMIDIGHANTAM SRI NARASIMHA & JUSTICE ATUL S. CHANDURKAR.