Rescuing the Expired Mandate: Supreme Court on Section 29A Extensions

Supreme Court Reviews Section 29A Extensions: Addressing Expired Mandates with Judicial Insight.

Background

Section 29A of the Arbitration and Conciliation Act, 1996 prescribes a twelve-month period from the completion of pleadings for an arbitral tribunal to deliver its award in domestic arbitrations. Parties may by consent extend this by a further six months under Section 29A(3). Beyond eighteen months, only a court can grant further time, upon sufficient cause shown. The question that had divided High Courts across the country was a deceptively simple one: must the application for court-granted extension be filed before the statutory period runs out, or can it be filed after the mandate has already lapsed?

The Calcutta High Court in Rohan Builders (India) Pvt. Ltd. v. Berger Paints India Limited, and the Patna High Court in a connected matter, had taken the stricter view: once the twelve or eighteen months expired without an extension application pending before a court, the arbitral mandate terminated, and the court was powerless to revive it. The Delhi, Bombay, Kerala, Madras, and Jammu and Kashmir High Courts had taken the opposite view, holding that the court retained the power to extend the period even after its expiry.

The Supreme Court, in a batch of appeals decided on 12 September 2024, settled the question conclusively in Rohan Builders (India) Private Limited v. Berger Paints India Limited, (2025) 10 SCC 802.

What the Supreme Court Held

The Court, per Justice Sanjiv Khanna, held that an application for extension of time under Section 29A(4) read with Section 29A(5) is maintainable even after the expiry of the twelve-month or the extended six-month period. The court's power to grant extension is not extinguished by the mere lapse of the statutory window.

The Court's reasoning rested on the text of Section 29A(4) itself. The provision states that the mandate of the arbitral tribunal shall terminate 'unless the court has, either prior to or after the expiry of the period so specified, extended the period.' The expression 'prior to or after' is unambiguous. The legislature expressly contemplated that an extension application could be filed and granted after the period had expired. Giving the word 'terminate' an absolute and irreversible meaning would render this phrase otiose.

The Court also noted that the word 'terminate' in Section 29A(4) is not followed by a full stop. It is qualified immediately by the word 'unless', which introduces the court's power to extend. Termination under Section 29A(4) is therefore conditional on the non-filing of an extension application, not an absolute legal consequence that cannot be undone. The Court rejected the Calcutta High Court's reliance on the legislative preference for 'terminate' over 'suspend', finding that 'suspend' was avoided not to foreclose post-expiry applications, but to prevent arbitral proceedings from hanging in limbo indefinitely when no party acts.

Crucially, the Court clarified that this does not mean extensions are granted as a matter of course after the period lapses. Section 29A(5) requires the applicant to show sufficient cause, and the court may impose terms and conditions. The first proviso to Section 29A(4) permits fee reduction of up to five percent per month of delay attributable to the tribunal. Judicial discretion remains the check against abuse.

Why This Matters for Commercial Dispute Resolution

The judgment prevents a technically lapsed mandate from becoming a jurisdictional death sentence for arbitrations that may have consumed years of proceedings and significant resources. A strict interpretation would have forced parties to abandon ongoing references mid-stream and start afresh, wasting time, money, and evidence already on record.

At the same time, the ruling is not a licence for indolence. Parties that monitor statutory timelines proactively, flag approaching deadlines, and move for extensions before expiry will always be in a stronger position.

Citation: Rohan Builders (India) Private Limited v. Berger Paints India Limited, arising out of Special Leave Petition (Civil) No. 23320 of 2023 and connected matters, decided on 12.09.2024, reported at (2025) 10 SCC 802.