Section 14 Arbitration Act: Failure or impossibility to act

Section 14 of Arbitration and Conciliation Act, 1996: Failure or impossibility to act

Official Bare Act Text

Override / Mandate Mens Rea (Intent) Actus Reus (Conduct) Punishment Limitation Monetary

(1) The mandate of an arbitrator shall terminate and he shall be substituted by another arbitrator, if—

(a) he becomes de jure or de facto unable to perform his functions or for other reasons fails to act without undue delay; and

(b) he withdraws from his office or the parties agree to the termination of his mandate.

(2) If a controversy remains concerning any of the grounds referred to in clause (a) of sub-section (1), a party may, unless otherwise agreed by the parties, apply to the Court to decide on the termination of the mandate.

(3) If, under this section or sub-section (3) of section 13, an arbitrator withdraws from his office or a party agrees to the termination of the mandate of an arbitrator, it shall not imply acceptance of the validity of any ground referred to in this section or sub-section (3) of section 12.

Statutory Defined Terms in this Section: (Click any term for official legal definition)

Arbitration Sec 2(1)(a)

Legal Commentary & Landmark Judgments: Section 14

Section 14 of the Arbitration and Conciliation Act, 1996 regulates the termination of the mandate of an arbitrator when the arbitrator becomes de jure or de facto unable to perform their functions or fails to act without undue delay.

Grounds for Termination: Mandate terminates if arbitrator: (a) becomes de jure or de facto unable to perform functions or for other reasons fails to act without undue delay; and (b) withdraws from office or parties agree on termination.
Court Application to Terminate: If a controversy remains concerning any of these grounds, a party may apply to the Court to decide on the termination of the mandate.
De Jure Inability Scope: Encompasses statutory ineligibility under Section 12(5) read with Seventh Schedule (conflict of interest), physical incapacity, or death.
Substitution under Section 15: Termination of mandate leads to substitution of arbitrator under Section 15.

Key Landmark Precedents:

HRD Corporation v. GAIL (India) Ltd., (2018) 12 SCC 471: The Supreme Court authoritatively held that when an arbitrator falls under any item of the Seventh Schedule, they become de jure unable to perform functions under Section 14(1)(a); the High Court can terminate their mandate under Section 14(2) without waiting for an award.
Bharat Broadband Network Ltd. v. United Telecoms Ltd., (2019) 5 SCC 755: The Supreme Court held that a Section 14(2) petition before the High Court is the proper remedy to remove a disqualified arbitrator under Section 12(5).

Courtroom Practice & Strategic Litigation Guidance:

If a sole arbitrator appointed unilaterally by a government department or corporation refuses to recuse, do not participate under protest; file an immediate petition under Section 14(2) before the High Court to terminate their mandate citing Perkins Eastman.

Section 14: Failure or impossibility to act

Section 14 of Arbitration and Conciliation Act, 1996: Failure or impossibility to act

Legal Commentary & Landmark Judgments: Section 14