Arbitrations With The State: Time Is Of The Essence!

Arbitration proceedings arising from contracts with government departments are more often than not, a quagmire of inordinate delays, huge costs and frequent visits to the court seeking intervention. The Supreme Court of India, in a recently reported decision in Union of India and others vs. Uttar Pradesh State Bridge Corporation Limited (2015) 2 SCC 52 has taken the government to task and held that inordinate delays in conducting arbitration proceedings and the inability of the tribunal to perform its functions are grounds for termination of mandate of the arbitral tribunal.

What is more interesting however is that the apex court has gone one step further and held that while appointing a new tribunal under Section 15 of the Arbitration and Conciliation Act, 1996 (the Act) the court need not follow the procedure prescribed under the arbitration agreement between the parties.