Absence of Intent to Relinquish Claim and Subsequent Arbitrator Withdrawal Preclude Finding of Abandonment Under Section 14

The Petitioner, a joint venture, was awarded a contract by the Respondent on 05.09.2013 for the construction of railway bridges

Following disputes, the contract was terminated on 08.08.2017, and arbitration was invoked on 06.02.2019

On 04.02.2021, the High Court appointed Justice Tapan Kumar Dutt (Retd.) as the Sole Arbitrator

Due to financial constraints, the Petitioner did not communicate the appointment order to the Arbitrator for over four years

When finally notified on 11.06.2025, the Arbitrator withdrew from the proceedings on 19.06.2025

The Petitioner subsequently filed the present petition seeking termination of the original mandate and appointment of a substitute arbitrator

1. Whether the Petitioner’s inordinate delay of four years in prosecuting the arbitration amounts to an implied abandonment of the arbitral proceedings

2. Whether the petition for substitution of an arbitrator under Sections 14 and 15 is barred by limitation under Article 137 of the Limitation Act, 1963

The court primarily applied Sections 14 and 15 of the Arbitration and Conciliation Act, 1996, regarding the termination of an arbitrator's mandate and the appointment of a substitute

It relied on Section 43 of the Act, which makes the Limitation Act, 1963, applicable to arbitrations

Regarding abandonment, the court applied the principle from Dani Wooltex Corporation v. Sheil Properties Pvt. Ltd. (2024), which establishes that abandonment cannot be readily inferred and requires convincing circumstances showing a clear, unequivocal intention to relinquish a claim

It also considered Article 137 of the Limitation Act, which provides a three-year period for applications not otherwise provided for

The court reasoned that while the four-year delay was substantial and the explanation of "financial constraints" was not entirely satisfactory, it did not constitute abandonment

Applying the Dani Wooltex test, the court found the Petitioner's attempts to file a petition in 2025 and the eventual communication to the Arbitrator demonstrated a "continuing intention" to pursue the remedy

On the issue of limitation, the court rejected the Respondent's argument that the clock started in 2021. It held that for a petition under Sections 14 and 15, the right to apply arises only when the mandate becomes incapable of performance—in this case, on 19.06.2025, when the Arbitrator withdrew

The court emphasized a "pro-arbitration approach," stating that procedural lapses should not technicality defeat substantive rights or the continuity of the arbitral process

It ruled that the claim was neither abandoned nor barred by limitation, as the cause of action for substitution arose only upon the arbitrator’s formal withdrawal

The Court appointed Justice Pranab Kumar Chattopadhyay (Retd.) as the substitute Sole Arbitrator to adjudicate the disputes, directing him to file a disclosure under Section 12(1) and proceed according to law