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[Landmark Judgement] TATA Sons (P) Ltd. V. Siva Industries & Holdings Ltd. (2023)

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Landmark Judgment Law Insider (1)

Published on: November 29, 2023 at 12:30 IST

Court: Supreme Court of India

Citation: TATA Sons (P) Ltd. V. Siva Industries & Holdings Ltd. (2023) 

Honourable Supreme Court of India has held that Section 29A of the Arbitration and Conciliation Act, 1996 is mandatory in nature which mandates all arbitral awards shall be made within a period of twelve months from the date on which the Arbitral Tribunal enters upon the reference. It is held that Section 29A(4) Arbitration and Conciliation Act, 1996 in case the arbitral award was not rendered within the twelve then the mandate of the arbitrator(s) would stand terminated, unless on an application made by any of the parties, the court extended time on sufficient cause being shown.

25. After the amendment, Section 29-A(1) stipulates that the award “in matters other than international commercial arbitration” shall be made by the Arbitral Tribunal within a period of twelve months from the date of the completion of the pleadings under Section 23(4). ………………The expression “in matters other than an international commercial arbitration” makes it abundantly clear that the timeline of twelve months which is stipulated in the substantive part of Section 29-A(1), as amended, does not apply to international commercial arbitrations.

This is further reaffirmed in the proviso to Section 29-A(1) which stipulates that the award in the matter of an international commercial arbitration “may be made as expeditiously as possible” and that an “endeavour may be made to dispose of the matter within a period of 12 months” from the date of the completion of pleadings. The expression “as expeditiously as possible” coupled with the expression “endeavour may be made” demonstrate that the intent of Parliament is that the period of twelve months for making the award is not mandatory in the case of an international commercial arbitration.

In an international commercial arbitration, the Arbitral Tribunal is required to endeavour, that is, make an effort to render the arbitral award within a period of twelve months or in a timely manner. In a domestic arbitration, Section 29-A(1) stipulates a mandatory period of twelve months for the arbitrator to render the arbitral award. In contrast, the substantive part of Section 29-A(1) clarifies that the period of twelve months would not be mandatory for an international commercial arbitration. 

Drafted By Abhijit Mishra