High Courts to decide on applications under section 11(6) of Arbitration Act within 6 months: Supreme Court.
"It was noted that any pendency and delay in appointing an arbitration under Section 11(6) of the Act defeats the entire object and purpose of the Arbitration Act."
The Supreme Court recently directed the High Courts to decide the arbitrators within six months for such cases which have been pending for over a year.
Pursuant to Section 11(5) and (6) of the Arbitration Act, the court may appoint an arbitrator in the event the parties fail to agree on a sole arbitrator or if there is a failure to agree on the procedure of the proceedings.
The present appeal was initiated after the High Court of Telangana failed to appoint an arbitrator for a period of 4 years. The Court noted that the application under Section 11(6) of the Act was made in the year 2016, however, the Court did not rule on the same until 2020 and now the application has been dismissed.
Additionally, the High Court of Telangana submitted a report to the Court which highlighted that another petition was filled in the year 2006 and is pending to date. The Court also took note that there were several other cases pending due to a delay in appointing an arbitrator by the High Court.
In light of the observations made, the Court directed the High Courts to appoint arbitrations within six months for all such cases which have been pending for over a year.
The Court also pointed out that, under the Commercial Court Act, all commercial disputes are required to the disposed of within one year. Even under the Arbitration Act, the Arbitrator is required to decide on matters within one year.
The Court was of the opinion that if an application under Section 11 (6) of the Act is not decided within a reasonable time, more particularly within one year from the date of filing, the object and purpose of the Arbitration Act are frustrated.
The Registry was directed to call the statement/particulars concerning the pending applications under Section 11(6) of the Arbitration Act from all the High Courts.