OYO Apartments Investments LLP v Desire Infrabuild Pvt. Ltd. | O.M.P (COMM.) NO. 343 OF 2024). DHC

Delhi High Court: Grants stay of the effect and operation of the Impugned Award dated April 6, 2024, without seeking deposit of monies by Petitioner, as required under Section 36(3) of the Arbitration and Conciliation Act, 1996 (the “Act”), and Order XLI Rule 5(3) of the Code of Civil Procedure, 1908, on the prima facie view that the award was rendered after the mandate of the learned Arbitrator had already expired. The award was challenged on the grounds inter alia that the Arbitral Award had been passed after the mandate of the arbitrator had expired.

In the arbitration proceedings between the parties, the pleadings stood completed on July 15, 2022, as per Section 23(4) of the Arbitration and Conciliation Act, 1996, since the Petitioner filed its Statement of Defence on July 15, 2022. As per Section 29A of the Act, the Arbitrator has a period of 12 months from the date of completion of pleadings to pass the award, which was set to expire on July 14, 2023. However, the parties agreed to extend the mandate of the learned Tribunal by an additional 6 months, as permitted under Section 29A(3) of the Act, thereby extending the mandate until January 14, 2024. Despite the Arbitrator’s mandate expiring on January 15, 2024, rendering the Tribunal functus officio, the impugned award was passed on April 06, 2024.

Notably, no application was filed before the Hon’ble Delhi High Court to seek an extension of the mandate of the Arbitrator.

The Hon’ble Delhi High Court, on the prima facie view that the Arbitral Tribunal was functus officio on the date the Impugned Award was passed, was pleased to stay the operation and effect of the impugned award.

Advocates for the Petitioner: Senior Advocate Gopal Jain, along with Advocates Chaitanya Kaushik, Junaid Aamir, and Avinash Singh.