LI Network
Published on: October 3, 2023 at 23:46 IST
The Responsibility Lies with the Arbitrator to Fulfill the Task Within the Statutory Timeframe: Himachal Pradesh HC Extends Arbitration Deadline in Land Acquisition Case.
The Himachal Pradesh High Court has emphasized that it is the responsibility of the arbitrator to conclude arbitration proceedings within the time frame stipulated by the statute.
The Court has instructed the arbitrator to finalize the proceedings by March 31, 2024, highlighting the entitlement of landowners, whose properties were acquired for the construction of National Highway 21, to receive just and equitable compensation.
Justice Bipin Chander Negi stated, “This Court is of the considered view that when the law requires a particular act to be done in a particular manner, then the same is mandatorily required to be followed. In the cases at hand, the onus was upon the Arbitrator to perform the task entrusted to him within the time schedule prescribed in the statute. The delay, if any, has to be bonafide and explainable.”
The arbitration dispute stemmed from land acquisition in District Mandi for the purpose of constructing, maintaining, and operating National Highway-21, carried out under the provisions of the National Highways Act, 1956. The landowners contested the awards granted to them by approaching the High Court.
The Court noted that arbitration must be completed within six months from the date the arbitrator receives a statement of claim and defense. The arbitral award must be rendered within 12 months from the conclusion of pleadings.
The Court emphasized that if the arbitral award is not issued within the stipulated period, the arbitrator’s mandate would terminate, except in cases where an extension was granted.
Furthermore, the Court stated that when the law mandates a specific protocol to be followed in a particular act, such protocol must be adhered to. The Court affirmed that it was the arbitrator’s responsibility to perform the task within the time frame prescribed by the statute.
The Court, after examining the records, observed that the arbitrator had adjourned the cases on numerous occasions. It warned that it would utilize its authority under Section 29(a)(6) of the Arbitration and Conciliation Act, 1996 (Act) to terminate the arbitrator’s mandate if it found the arbitrator to be negligent in his duties.
The Court emphasized, “Be that as it may, the Court is restraining from making any further observation in the case, save and except, that henceforth, if the Court finds the Arbitrator to be remiss in his duties then it shall not hesitate in invoking its powers as are enshrined in Section 29 (A) (6) of the 1996 Act to terminate the mandate of the Arbitrator de hors the fact that the Arbitrator happens to be appointed, in terms of the aforesaid notification, issued by the Central Government under the National Highways Act, 1956.”
Therefore, the Court ruled that the landowners were entitled to just and fair compensation, and the arbitrator had failed in his duty to complete the proceedings within the prescribed time, causing significant harm to the Petitioners.
Consequently, the Court dismissed the Petitions and instructed the arbitrator to conclude the proceedings by March 31, 2024.
Case Title: Puran Singh v Land Acquisition Officer And Anr.
