Limitation period u/s 29Aof The Arbitration Act Not Applicable To International Commercial Arbitration

Limitation period u/s 29A Arbitration Act Not Applicable To International Commercial Arbitration: Supreme Court of India

The Supreme Court held that the time limit of twelve months as prescribed in Section 29A of the Arbitration and Conciliation Act is not applicable for international commercial arbitration.

In terms of the amended provisions of Section 29A, arbitral tribunals in international commercial arbitrations are only expected to make an endeavor to complete the proceedings within twelve months from the date of competition of pleadings and are not bound to abide by the time limit prescribed for domestic arbitrations. The limitation period of twelve-months is only directory in nature for an international commercial arbitration but cannot be forced or mandated.

The expression “in matters other than an international commercial arbitration” makes it abundantly clear that the timeline of twelve months which is stipulated in the substantive part of Section 29A (1), as amended, does not apply to international commercial arbitrations. This is further reaffirmed in the proviso to Section 29A(1) which stipulates that the award in the matter of an international commercial arbitration “may be made as expeditiously as possible” and that an “endeavour may be made to dispose of the matter within a period of 12 months” from the date of the completion of pleadings. The expression “as expeditiously as possible” coupled with the expression “endeavour may be made” demonstrate that the intent of Parliament is that the period of twelve months for making the award is not mandatory in the case of an international commercial arbitration.

Arbitration and Conciliation Act, 1996; Section 29A – After the 2019 amendment, the time limit of twelve months as prescribed in Section 29A is applicable to only domestic arbitrations and the twelve-month period is only directory in nature for an international commercial arbitration – Arbitral tribunals in international commercial arbitrations are only expected to make an endeavor to complete the proceedings within twelve months from the date of competition of pleadings and are not bound to abide by the time limit prescribed for domestic arbitrations.

Parties: TATA Sons Pvt Ltd versus Siva Industries and Holdings Ltd.

Bench: CJI D Y Chandrachud and Justice P S Narasimha

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Source: Supreme Court of India

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