India’s Judicial Divide on Arbitral Timelines and Discretion

[Shailraj is a student at National Law School of India University.]

The Arbitration and Conciliation Act 1996 (Act) mandates the expeditious conclusion of arbitral proceedings, a principle crystallized in statutory timelines for completion of pleadings under Section 23(4) and for making of an arbitral award under Section 29A. However, courts have taken different views on whether contractually agreed institutional timelines determined by arbitration institutions are binding or flexible. The Delhi High Court, in Aneja Constructions (India) Limited v Doosan Power Systems India Private Limited (2025), allowed a tribunal’s discretion to extend deadlines for completion of pleadings, holding that procedural rules are “handmaidens of justice” that should not be read to overpower the tribunal’s duty to ensure a just outcome. However, a coordinate bench of the Delhi High Court in Ram Kawar Garg v. Bajaj Capital Investor Services Limited. (2025) set aside an award that was rendered beyond the stipulated period –  championing contractual sanctity, while holding that excessive delays resulting in delayed award contravene the broader public policy of mandate of achieving swift resolution of disputes.

Navigating a middle path, the Bombay High Court in Bhanuchandra J Doshi v Motilal Oswal Securities Limited (2025) interpreted an initial deadline as to make an arbitral award directory but ruled that the outer time limit was mandatory. This jurisprudential conflict raises a critical question: do institutional rules create unassailable jurisdictional limits or merely procedural guides?

The Doctrinal Fault Line: Contract v/s Discretion

The principle of party autonomy, hailed by the Supreme Court as the “brooding and guiding spirit of arbitration“, finds statutory expression in Section 2(8) of the Act. This provision elevates contractually chosen institutional rules to the status of binding obligations, effectively incorporating them into the arbitration agreement itself. Parties opt for institutional arbitration precisely for the predictability and efficiency that these rules offer, creating a legitimate expectation of strict adherence. Consequently, procedural timelines are not mere guidelines but contractual mandates. Any deviation, as was contested in cases like Aneja Constructions and Ram Kawar Garg, is not merely a procedural lapse but arguably a breach of the foundational agreement between the parties.

Conversely, the Act invests tribunals with considerable procedural latitude. Section 19 liberates tribunals from the rigid confines of the Code of Civil Procedure 1908, and the Indian Evidence Act 1872, empowering them to conduct proceedings in a manner they consider appropriate. This discretion was central to the Delhi High Court's reasoning in Aneja Constructions. Crucially, the Act, prior to its 2015 amendment, which introduced Section 29A, imposed no statutory timeline for rendering an award, creating a legislative gap that institutional rules were designed to fill. However, the present framework establishes an interpretive arena where a tribunal’s duty to ensure a fair adjudication can directly conflict with the parties’ contractual bargain for speed and certainty.

The ‘Interest of Justice’ Wildcard: Aneja Constructions Loosens the Reins

The Aneja Constructions decision is the high-water mark for tribunal discretion. The dispute was governed by the Indian Council of Arbitration (ICA) Rules, under which a Statement of Defence (SoD) had to be submitted within 30 days, extendable by a further 30 days. The respondent submitted its SoD and counter-claim long after this 60-day period. In its consideration, the tribunal condoned the delay of the Respondent in filing the SoD on the basis that procedural rules are “meant to guide and not bind” and are required to give way to the “interest of justice.”

In appeal, the Delhi High Court declined to intervene, while observing ahigh standard of judicial review. It held that as the ICA Rules were not a statutory law, they were “more of a procedural nature” and could be construed liberally. The Court reiterated that interference is allowed only in instances of “bad faith, exceptional rarity,” or directives that are “absolutely perverse.” The refusal of the Supreme Court to grant the Special Leave Petition adds strength to this deferential strategy. Aneja, therefore, constitutes a strong judicial affirmation of the “handmaiden of justice” principle, wherein the tribunal’s discretionary authority to regulate proceedings is given priority at the expense of the rigid letter of institutional regulations, effectively making them directory by default.

Soft Deadlines, Hard Limits: The Two-Tiered Timeline of Bhanuchandra Doshi

The broad judicial discretion endorsed in Aneja Constructions for pleading timelines must be contrasted with the more structured approach taken by the Bombay High Court in Bhanuchandra J Doshi concerning the deadline for rendering the final award. Where Aneja addressed a delay in filing an SoD at the procedural outset, Doshi confronted a situation where pleadings were complete and the award itself was issued after the initial timeline prescribed by the National Stock Exchange (NSE) Bye-Laws had lapsed. The governing institutional rule, Rule 13(b) of the Bye-Laws, required an award “normally within 3 months,” with a final outer limit of 6 months.

Rather than applying the “interest of justice” principle as was done in Aneja concerning timelines for completion of pleadings, the court in Doshi engaged in a close textual analysis. It held that the specific word “normally” rendered the initial 3-month deadline to make an arbitral award directory, not a rigid jurisdictional mandate. Crucially, however, the court drew a firm line, reasoning that the six-month outer limit, which lacked such a qualifier, was mandatory. The Doshi approach suggests that the sanctity of timelines is not uniform throughout the arbitral process. While flexibility may govern preliminary steps like pleadings to ensure a fair hearing, the deadline for the final award, which is the very culmination of the process, demands stricter adherence to uphold the core promise of arbitral finality. The Doshi framework thus offers a more nuanced compromise: procedural rules are guides at the start but become mandates at the finish line.

The Iron Cage of Contract: Ram Kawar Garg’s Strict Stance

In stark opposition to the judicial flexibility shown in Aneja, the Delhi High Court’s ruling in Ram Kawar Garg reflects the judiciary’s most vigorous defence of party autonomy through the strict enforcement of timelines. In this case, the governing NSE Bye-Law 19(b) and SEBI circulars mandated that an appellate award “shall be disposed of” within a three-month period, extendable by another two like periods. The award was ultimately rendered nearly six months after this final, extended deadline had passed. In its ruling, the court set the award aside, holding that the excessive delay violated public policy and rendered the award void.

The rationale was rooted in jurisdictional finality. The court interpreted the word “shall” as imposing a mandatory deadline, not a directory one, causing the tribunal to become functus officio (without power to act) once the outer period to make the arbitral award had elapsed. It held that to find otherwise would render the specific NSE Bye-Law allowing for an arbitrator's removal for “undue delay” completely pointless, or “otiose”. This approach treats institutional deadlines not as procedural guides, but as absolute jurisdictional boundaries, the breach of which is a fatal flaw.

Competing Visions for Indian Arbitration

These cases reveal 2 conflicting judicial visions, whose application appears to depend critically on the stage of the arbitral proceeding at which the delay occurs.

The Strict Compliance Vision represented by Ram Kawar Garg – this school of thought applies force to the deadline for rendering the final award. In Garg, the delay occurred after pleadings were complete, violating a timeline set by the highly-regulated NSE Bye-Laws. Under this view, such timelines are jurisdictional limits. Once the extended mandate expired, the tribunal became functus officio , and its power to act was extinguished. This approach prioritizes the certainty and finality promised by institutional arbitration, treating the agreed schedule not as a guideline, but as an absolute condition of the tribunal’s mandate.

The Substantive Justice Vision represented by Aneja Constructions – this vision is most evident when dealing with delays in interlocutory stages like pleadings. In Aneja, the delay concerned the filing of an SoD. Here, the tribunal’s duty to ensure a full hearing on the merits took precedence. Procedural rules were deemed “handmaidens of justice”, preventing a ‘technical knockout’ before the case could be fully argued. This perspective leverages the tribunal's discretionary powers under Sections 19 and 25 to prioritize a complete adjudication over rigid adherence to preliminary deadlines.

Discovering a Middle Ground that is Sustainable

The existing judicial swing concerning timelines requires clarity. The present position can cause confusion for parties. A stage-sensitive framework, drawing from the logic of the judgments themselves, offers the most coherent path forward.

For interlocutory stages, such as the pleading delays in Aneja, institutional deadlines should be presumptively binding but flexible. A tribunal seeking an extension must issue a reasoned order demonstrating: (1) exceptional cause for the delay; (2) an absence of substantial prejudice to the non-defaulting party; and (3) that the extension is necessary for a just resolution. However, for the final award, as contemplated in Garg and Doshi, the outer timeline must be treated as a hard, jurisdictional limit. Breaching it should render the tribunal functus officio, with extensions permissible only by explicit party consent or, by analogy to Section 29A, through a court order. This tiered approach gives teeth back to institutional rules where finality matters most, without sacrificing fairness in preliminary procedural matters.

Conclusion

The split between Aneja, Doshi, and Ram Kawar Garg is not an innocuous disagreement; it is a contest for the soul of Indian arbitration. The procedural flexibility of Aneja at the pleading stage, if applied universally, risks creating “ad hoc arbitration with an institutional label.” Conversely, the absolute strictness of Garg at the award stage can lead to draconian outcomes, where years of proceedings are invalidated by a technical default.

The path forward lies in a stage-sensitive synthesis: treat preliminary timelines as binding but flexible, with extensions granted only on reasoned orders, while enforcing final award deadlines as hard, jurisdictional limits. Until this framework is adopted, litigants in India will face a system where the clock on their arbitration can be a stopwatch, a proposal, or a time bomb.