Latest Arbitration Law News – Supreme Court Upholds Arbitral Tribunal’s Discretion to Condone Delay in Filing Written Statement: New Delhi – In a significant ruling on arbitration law, the Supreme Court of India has upheld the discretion of arbitral tribunals to condone delays in procedural timelines, even when institutional arbitration rules set strict deadlines. The Court dismissed a plea from Aneja Constructions challenging the Delhi High Court’s endorsement of a tribunal’s decision to allow an 84-day delay by Doosan Power Systems India in filing its statement of defence and counterclaim.
The case, Aneja Constructions v. Doosan Power, involved a dispute arising from a sub-contract agreement dated December 27, 2017, between the two parties. The agreement stipulated that any disputes would be resolved through arbitration governed by the Indian Council of Arbitration (ICA) Rules.
Under Rule 18(a) of the ICA Rules, a party is required to file its statement of defence within 60 days of receiving a request for arbitration. The rule also allows a 30-day extension, but no further delay is permitted. However, Doosan Power Systems filed its defence 84 days late, prompting a challenge from Aneja Constructions.
On July 11, 2025, the tribunal, chaired by Justice (retd) Vikramajit Sen, exercised its discretion and condoned the delay, citing the tribunal’s inherent power to extend timelines “in the interest of justice,” even in the face of restrictive language in the ICA Rules. The tribunal argued that although the rules specified a timeline of “not exceeding thirty days,” the wording did not impose a mandatory restriction and allowed flexibility in appropriate circumstances.
Aneja Constructions, dissatisfied with the tribunal’s decision, moved the Delhi High Court, which ruled on August 6, 2025, to uphold the tribunal’s decision. Justice Manoj Jain dismissed the petition, stating that the ICA Rules “are meant to guide and not bind,” and affirmed that tribunals have the discretion to condone delays if it serves the interests of justice.
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In response, Aneja Constructions filed a special leave petition with the Supreme Court, arguing that the tribunal’s decision violated Section 2(8) of the Arbitration and Conciliation Act, 1996, which mandates that institutional rules chosen by the parties form part of the arbitration agreement. The petitioner also contended that by allowing the delay beyond the 30-day extension limit, the tribunal had “re-written the contract” and undermined party autonomy.
Furthermore, the petitioner relied on the landmark ruling in New India Assurance Co. v. Hilli Multipurpose Cold Storage, arguing that the phrase “not exceeding” in the ICA Rules imposed a hard cap on the timeline for filing the defence.
However, the Supreme Court bench, comprising Justices JB Pardiwala and KV Viswanathan, rejected these arguments, reinforcing the principle that arbitral tribunals have wide discretion to adjust procedural timelines in the pursuit of justice. The Court dismissed the plea, upholding the Delhi High Court’s ruling.
In its judgment, the Supreme Court emphasized that arbitration is designed to be a flexible and efficient alternative dispute resolution mechanism, and rigidly adhering to procedural timelines could sometimes undermine the overall fairness of the process. The decision reaffirms the broad scope of discretion available to tribunals in balancing the interests of justice and procedural efficiency.
Aneja Constructions was represented by Advocates Sidhant Goel, Mohit Goel, Aditya Maheshwari, and Ishaan Pratap Singh from the law firm Sim & San.
This ruling is seen as a landmark decision in arbitration jurisprudence, highlighting the flexibility of arbitral tribunals to ensure justice is served, even at the cost of overriding strict procedural timelines agreed by the parties in the arbitration agreement.
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