Time Limits for the Award, and the Fast Track Procedure

In one line

A domestic arbitration must produce its award within twelve months of the pleadings closing, extendable by six months with consent and after that only by a court, which can cut the arbitrators' fees for delay.

In exam wording: section 29A of the Arbitration and Conciliation Act 1996 imposes a time limit for making the arbitral award and provides for its extension by consent and by the Court, and section 29B provides an optional fast track procedure.

Why a statute fixes a deadline at all

Almost every other provision in Part I is about fairness or jurisdiction. Section 29A is about speed, and it exists because arbitration in India had lost its main advantage. References ran for years, hearings were adjourned, and the parties had no lever at all.

Section 29A was inserted by the 2015 amendment and gives them one: a statutory deadline, with the loss of the arbitrator's mandate as the sanction and a reduction of fees as the penalty for causing the delay.

The change in 2019 that most notes miss

State the period from the right starting point or the answer is wrong.

As inserted in 2015, section 29A(1) required the award to be made within twelve months from the date the arbitral tribunal enters upon the reference.

As substituted by the 2019 amendment, it requires the award in matters other than international commercial arbitration to be made within twelve months from the date of completion of pleadings under section 23(4).

The change was sensible. Running the clock from the tribunal's first sitting meant it started before anybody had pleaded, so much of the twelve months went on exchanging documents. Running it from the completion of pleadings gives the tribunal a full year to hear and decide, and section 23(4) separately caps the pleading stage at six months from the arbitrators receiving written notice of appointment.

The Jammu and Kashmir and Ladakh State amendment keeps the old rule. There, sub-section (1) is substituted to read twelve months from the date the arbitral tribunal enters upon the reference, with an Explanation deeming that to be the date all the arbitrators received written notice of their appointment, and the second and third provisos to sub-section (4) are omitted.

International commercial arbitration is treated differently

The proviso to section 29A(1): the award in the matter of an international commercial arbitration may be made as expeditiously as possible and endeavour may be made to dispose of the matter within a period of twelve months from the date of completion of pleadings.

Read the words. For a domestic arbitration the award shall be made within twelve months. For an international commercial arbitration it is an endeavour, not a mandate. The distinction was introduced in 2019, in recognition that a foreign party will not accept a statutory guillotine on its arbitration.