Introduction
Does a ticking clock have the power to kill a legal mandate, or is the court the final master of time? For decades, Indian arbitration was characterised by a “culture of delay” that transformed private dispute resolution into a marathon without a finish line. The 2015 introduction of Section 29A1 was intended as a corrective to this inefficiency, imposing a strict 12 month deadline to force a conclusion. Yet, this legislative fix birthed a new systemic crisis: when the clock runs out, must the arbitrator be sacrificed for the sake of discipline, or should the process be salvaged for the sake of continuity?
Termination vs. Resurrection
At the heart of this tension lies a legal paradox. Under Section 29A(4)2, the expiration of time triggers a “self-operating” termination of the arbitrator’s mandate, a statutory death sentence for the proceedings. However, this death is conditional; the court retains the unique power to retroactively revive the mandate, acting as a temporal bridge between a lapsed deadline and a final award. The true friction, however, came to light under Section 29A(6). As courts weighed whether to extend these deadlines, a fundamental question divided the bench: is the power to “substitute” an arbitrator a mandatory penalty for delay, or a discretionary tool to be used only when the process has fundamentally broken down? The debate pitted strict statutory discipline against practical continuity asking if “we should burn the house down to punish a slow builder”3, or simply grant more time to finish the roof.
With the landmark ruling in Viva Highways Ltd vs. MPRDC (2026)4, the Supreme Court has settled this tug-of-war, decisively correcting the perception of judicial “obligation.” The interpretive uncertainty can be traced to an earlier decision, Mohan Lal Fatehpuria vs. M/s. Bharat Textiles (2025)5, which suggested that Section 29A(6) ‘empowers and obligates’ the Court to substitute an arbitrator. In Viva Highways, the Supreme Court clarified that the word “obligates” had been misinterpreted. The Court held that substitution is not an inevitable consequence of mandate termination. Instead, it is a discretionary power to be used only if the “situation so warranted” specifically in cases of “undue delay” directly attributable to the arbitrator. If the delay is systemic or attributable to the parties, substituting the arbitrator serves no purpose and only restarts the clock, causing further prejudice.
The ruling further clarified the jurisdictional divide between Section 11 and Section 29A. The High Court had assumed that because it held the power to appoint under Section 11, it also held the power to extend under Section 29A. The Supreme Court rejected this, following the precedent in Jagdeep Chowgule (2026)6, and ruled that while Section 11 appointments lie with the higher judiciary, Section 29A applications must be filed before the Principal Civil Court (Commercial Court) of original jurisdiction. Consequently, the Court moved the Viva Highways proceedings to the Commercial Court, Bhopal, ensuring that procedural extensions are handled locally rather than burdening the High Courts.
This shift to “Discretionary Continuity” balances the Doctrine of Functus Officio which dictates that an arbitrator loses jurisdiction once the statutory period expires with the Principle of Non-Interference. It recognizes that “starting over” with a new arbitrator is often less efficient than extending the current mandate. Ultimately, the Viva Highways (2026) judgment marks a definitive move from a punitive to a pragmatic interpretation. By decoupling “termination of mandate” from “mandatory substitution,” the Supreme Court has protected the arbitral process from being weaponized as a tactical tool for delay. It reinforces that while timelines are sacrosanct, the continuity of the tribunal is a matter of judicial discretion, reserved for cases where an arbitrator’s conduct, rather than a mere procedural lapse, warrants removal.
Conclusion
By decentralizing extension powers to local Commercial Courts, the ruling reduces procedural uncertainty around where Section 29A relief must be sought. It also reframes Section 29A as a case-management provision – one that enforces timeline discipline without turning a missed deadline into an automatic derailment of the arbitral process. In that sense, the judgment strengthens India’s arbitration framework by protecting procedural integrity while limiting the scope for technical lapses to be used to stall proceedings.
Citations
Expositor(s): Adv. Jahnobi Paul
