Once it terminates proceedings, arbitral tribunal cannot pass orders: High Court

A two-judge bench of the Telangana High Court declared that once an arbitral tribunal terminates proceedings it cannot subsequently pass any orders ‘on such termination and the arbitral tribunal is rendered functus officio’ and has no jurisdiction to continue arbitral proceedings. The bench comprising, Justice Naveen Rao and Justice Nagesh Bheemapaka, allowed a revision petition filed by HMDA and Hyderabad Growth Corridor ltd (HGCL). 

The petitioners entered into an agreement for works to be carried out by Ramky Elsamex for construction, development and maintenance of eight land-controlled expressways from Tukkuguda to Shamshabad on a ‘build operate and transfer’ basis. The agreement had an arbitration clause and both parties had a



dispute before a tribunal, headed by a retired High Court judge.

At one point in time, the parties were repeatedly taking adjournment for deposit of fee and if they failed to do so. The proceedings would stand terminated as it would be construed that the parties have no interest. 

Later, the HGCL took the plea that the tribunal proceedings stood terminated and therefore it couldn’t hear on merits. The presiding arbitrator and the co-arbitrator rejected the plea. After detailed hearing of the matter, the bench speaking through Justice Naveen Rao stated that the tribunal erred in proceeding to hear the matter after the proceedings before it were terminated.