Court Allows Extension of Arbitrator's Mandate Citing Public Holiday Delays
In a significant ruling, the Delhi High Court, under Justice Avneesh Jhingan, has granted the extension of the arbitrator's mandate in the case between Sarvesh Security Services Pvt. Ltd. and the Institute of Human Behavior Resource and Allied Sciences (IBHAS). The court's decision, dated May 15, 2026, allows the continuation of arbitration proceedings that had been challenged due to the award being pronounced after the expiration of the arbitrator's mandate.
The dispute arose from a contract for security services provided by the petitioner, Sarvesh Security Services, to the respondent, IBHAS. The disagreement was escalated to arbitration under the Delhi International Arbitration Centre (DIAC). The arbitrator's mandate was initially extended until November 1, 2024. However, due to intervening public holidays, the award was pronounced on November 4, 2024. This delay led the respondent to challenge the validity of the award under Section 34 of the Arbitration and Conciliation Act, 1996.
The court had previously dismissed the petitioner's application for extending the mandate, resulting in the award being set aside. However, upon appeal, the Supreme Court restored the application for extension, allowing the petitioner another chance to seek the continuation of arbitration proceedings.
Justice Jhingan emphasized that the delay was caused by unavoidable circumstances, specifically the Diwali holidays, which resulted in the DIAC premises being closed. The court noted that substantial justice should prevail over technicalities, and the petitioner's inability to pronounce the award within the extended mandate period was not due to any fault of their own.
The judgment draws upon the precedent set by the Supreme Court in C. Velusamy v. K. Indhera, highlighting that an application for extension is maintainable even after the expiration of the mandate and the rendering of the award. The court clarified that the extension of the mandate does not automatically validate the award but removes one ground for challenge under Section 34.
In conclusion, the Delhi High Court's ruling underscores the judiciary's commitment to ensuring fair arbitration proceedings, taking into account unforeseen delays caused by public holidays. The extension of the arbitrator's mandate aims to facilitate a just resolution to the dispute between the parties involved.
Bottom line:-
Arbitration - Extension of the mandate of the arbitrator under Section 29A of the Arbitration and Conciliation Act, 1996, is permissible even after the expiry of the mandate and rendering of the award, provided sufficient cause is shown.
Statutory provision(s): Arbitration and Conciliation Act, 1996 Sections 29A, 34
