Denial of Section 29A extension for party's fault terminates proceedings, precluding fresh appointment under Section 11.

The dispute arose from a Deed of Assignment of Development Rights dated December 6, 2010

Following a Section 9 petition in 2019, the High Court referred the parties to arbitration and appointed a sole arbitrator

After an interim order was passed on August 31, 2020, no further progress occurred for over two years

The Applicants subsequently filed a petition under Section 29A of the Arbitration and Conciliation Act, 1996 ("the Act") seeking an extension of the arbitrator’s mandate.

By an order dated October 18, 2024, the Court refused the extension, recording a specific finding that the Applicants had "abandoned the arbitration proceedings"

This order was upheld by the Supreme Court on February 14, 2025

The Applicants then issued a fresh notice invoking arbitration, alleging a continuous cause of action, and filed the present Section 11(6) application for the appointment of a new arbitrator

The Court analyzed the interplay between Section 11 (appointment of arbitrators), Section 29A (time limit for awards), and Section 32 (termination of proceedings) of the Act.

It relied on the Supreme Court’s decision in Rohan Builders (India) Private Limited v. Berger Paints India Limited, which established that while Section 29A(4) makes a tribunal functus officio, it does not terminate proceedings in absolute terms for a "faultless party"

The Court further applied the principle from Fedbank Financial Service Ltd. v. Narendra H Shelar, holding that arbitration clauses cannot be constantly revived if a party was remiss in diligent prosecution

It distinguished between the "termination of mandate" (Sections 14, 15, 29A) and "termination of proceedings" (Section 32), noting that while the former does not always cause the latter, a finding of "abandonment" by a competent court effectively ends the proceedings

The Court observed that while the expiration of a mandate under Section 29A(4) generally terminates the arbitrator's authority, it does not automatically terminate the arbitral proceedings under Section 32 unless the party is at fault

Applying Rohan Builders, the Court held that the key determinant is whether the applicant is a "faultless party"

In the present case, the Section 29A Court had already recorded a final, emphatic finding—upheld by the Supreme Court—that the Applicants had "abandoned" the proceedings due to gross negligence

The Court reasoned that if it were to appoint a new arbitrator under Section 11(6) after such a finding, it would essentially be sitting in appeal or review of the Section 29A order

The Court rejected the Applicants' plea of "continuous cause of action," noting that the fresh invocation was merely an attempt to re-litigate the same disputes covered by the abandoned proceedings and overreach the previous judicial refusal to extend the mandate

The Court concluded that where a party's conduct has led to a judicial finding of abandonment, the arbitral proceedings are terminated, and the referral court cannot exercise jurisdiction to appoint a substitute arbitrator, as the reference itself is no longer alive