Time limit prescribed under 29A applicable to arbitrations invoked post-2015 Amendment 

In 2015, Section 29A was inserted to the Arbitration and Conciliation Act, 1996 (Act) by way of an amendment (2015 Amendment). It was again amended in 2019 (2019 Amendment). Section 29A of the Act prescribes timelines to pass an arbitral award i.e., within 12 months from the date of completion of pleadings with an additional grace period of 6 months, if the parties mutually agree. However, once the 18 months’ period is over, either of the parties may approach the competent court to extend the time period for passing the arbitral award. 

Recently, the Delhi High Court in M/S Chinar Steel Industries v. Ircon International Limited had the opportunity to consider if the time limit prescribed under Section 29A of the Act applies to arbitrations that commenced even before the 2015 Amendment but the arbitral tribunal “entered reference” only after the 2015 Amendment.   

While the 2015 Amendment provided that the arbitral award shall be passed within 12 months from the time the arbitral tribunal “entered reference”, the same was removed by the 2019 Amendment. Accordingly, the Delhi High Court observed that the date of “commencement” of arbitration is the yardstick to determine the applicability of Section 29A of the Act and not the time when arbitral tribunal “entered reference”. Accordingly, in the present case, the date when the arbitral tribunal “entered reference” becomes irrelevant. The Delhi High Court observed that although the arbitral tribunal was constituted i.e., “entered reference” after the 2015 Amendment, the arbitration was invoked prior to the 2015 Amendment. Therefore, the time limit prescribed under Section 29A of the Act will not apply to the present matter or to any matter that commenced prior to the 2015 Amendment.  

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