Delayed Production of a Power of Attorney Does Not Justify Termination of Arbitral Proceedings: Gujarat High Court

Can an Arbitral Tribunal terminate arbitral proceedings solely because the claimant failed to produce a Power of Attorney within the prescribed timeline? The Gujarat High Court recently addressed this issue in Pandya Naresh Chandra v. Shalin Infrastructure and Ors¹, examining whether non-production of a Power of Attorney constitutes a curable procedural irregularity or a jurisdictional defect warranting termination of arbitral proceedings. In answering this question, the Court reaffirmed that an arbitral tribunal’s power to terminate proceedings is strictly governed by the Arbitration and Conciliation Act, 1996 (“Act”), and cannot be expanded through an unduly technical application of procedural requirements.

At the outset, the Court reiterated that the Act is intended to facilitate expeditious, fair and effective resolution of disputes while minimising judicial intervention. In furtherance of these objectives, arbitral tribunals are expected to adopt a pragmatic and justice-oriented approach that advances adjudication on the merits, rather than one founded upon rigid procedural technicalities. Against this statutory backdrop, the Court examined the scope of Sections 25 and 32 of the Act to determine whether the Arbitral Tribunal was justified in rejecting the claimant’s statement of claim.

Factual Background and Legal Analysis

The dispute arose from a real estate transaction in which the petitioner, an 87-year-old Non-Resident Indian residing in London, entered into agreements concerning three residential flats in the “Shalin Heights” project for himself and his wife and paid an aggregate consideration of ₹61,00,500 to a partnership firm. Despite receiving the consideration, the respondents neither executed the sale deeds nor delivered possession of the flats, prompting the petitioner to invoke the arbitration clause contained in the agreements. Pursuant to an order of the Gujarat High Court, a sole arbitrator was appointed to adjudicate the disputes between the parties.

Considering his advanced age and overseas residence, the petitioner executed a Power of Attorney authorising his representative to act on his behalf before the Arbitral Tribunal. The Arbitration Centre initially directed the petitioner to file the statement of claim by 24 February 2025. As the communication was received belatedly, the petitioner obtained an extension until 15 April 2025. Within the extended timeline, the statement of claim was filed without enclosing the original Power of Attorney, as the document had not yet been received from the United Kingdom. On the following day, the petitioner’s advocate informed the Arbitral Tribunal that the original document would be placed on record immediately upon its receipt. Subsequently, the Arbitral Tribunal granted a further opportunity until 8 October 2025 for production of the original Power of Attorney.

When the original Power of Attorney was not produced before the Arbitral Tribunal at the scheduled hearing on 8 October 2025, the Tribunal rejected the statement of claim. Later that afternoon, after obtaining the original document, the petitioner’s advocate addressed an e-mail to the Arbitral Tribunal requesting recall of the order and explaining the circumstances surrounding the delay. The Arbitral Tribunal declined to recall its order, prompting the petitioner to invoke the supervisory jurisdiction of the Gujarat High Court under Articles 226 and 227 of the Constitution.

Before the High Court, the petitioner contended that non-production of the Power of Attorney constituted a curable procedural irregularity and that rejection of the statement of claim, which effectively brought the arbitral proceedings to an end, was contrary to Section 32 of the Act read with Rule 48 of the Arbitration Centre (Domestic and International), High Court of Gujarat Rules, 2021. The respondents opposed the petition by contending that the Act is a self-contained code and that the proceedings had been instituted without proper authority, rendering the claim not maintainable. The High Court held that the authorities relied upon by both parties were distinguishable on their facts and, therefore, did not govern the issue before it.

Allowing the petition, the Gujarat High Court referred to Pahal Engineers v. Gujarat Water Supply & Sewerage Board² in support of the principle that procedural deficiencies in arbitral pleadings should ordinarily be treated as curable rather than used to deny adjudication on the merits. The Court held that, in the present case, non-production of the original Power of Attorney was a curable procedural irregularity and not an incurable jurisdictional defect. 

Upon a harmonious reading of Sections 25 and 32 of the Arbitration and Conciliation Act, 1996 together with Rule 48 of the Gujarat High Court Arbitration Rules, the Court observed that Section 32(1) establishes the general rule that arbitral proceedings conclude with a final arbitral award, while Section 32(2) exhaustively sets out the limited exceptions permitting earlier termination. Since the claimant’s failure to produce a Power of Attorney did not fall within any of those statutory grounds, the Court held that the arbitral tribunal lacked the authority to terminate the proceedings on that basis. 

Accordingly, the Court held that the Act does not confer any general or residuary power upon an Arbitral Tribunal to terminate proceedings or reject a claim outside the contingencies expressly contemplated under Sections 25 and 32. It further emphasised that no additional grounds for termination can be imported through procedural rigidity or judicial interpretation beyond those specifically provided by the statutory framework. Since non-production of the original Power of Attorney within the stipulated timeline did not fall within any of the contingencies contemplated by Sections 25 or 32, the Arbitral Tribunal’s rejection of the statement of claim was held to be jurisdictionally erroneous and legally unsustainable. Having concluded that the Arbitral Tribunal exercised a jurisdiction not vested in it by the Act, the High Court held that interference under Article 227 of the Constitution was warranted to prevent denial of adjudication on the merits and the consequent miscarriage of justice.

Conclusion

The decision provides important guidance on the statutory limits governing an arbitral tribunal’s power to terminate proceedings under the Arbitration and Conciliation Act, 1996. It clarifies that curable procedural irregularities, including deficiencies relating to the production of a Power of Attorney and similar questions concerning representative authority, do not, by themselves, render a claim non-maintainable or justify termination of arbitral proceedings unless the facts unmistakably warrant such a conclusion.

More fundamentally, the judgment reinforces that arbitral tribunals must exercise their powers strictly within the statutory framework prescribed under Sections 25 and 32 of the Act. By holding that termination of arbitral proceedings is confined to the exhaustively enumerated statutory contingencies, and that no additional grounds may be introduced through procedural rigidity or judicial interpretation, the Gujarat High Court reaffirms the legislative scheme of the Act and underscores that arbitral proceedings should ordinarily culminate in an adjudication on the substantive merits of the dispute, except where the statute expressly provides otherwise.

Citations

1. Pandya Naresh Chandra v. Shalin Infrastructure and Ors., R/Special Civil Application No. 558 of 2026 (Guj. H.C.) (Unreported) ↩︎
2. Pahal Engineers v. Gujarat Water Supply & Sewerage Board, Letters Patent Appeal No. 101 of 2022 (Guj. H.C.) ↩︎

Expositor(s): Adv. Jahnobi Paul